Public Sector Unions

"A full 88% of America is union-free. Yet, despite the fact that the vast majority of American taxpayers do not belong to a union, let alone work for the government, we Americans are being held hostage by a loud and thuggish minority who feel that it is their right to force the vast majority of Americans to acquiesce to their demands." So comments Peter List [1] in the wake of the massive rallies that both support and protest Governor Scott Walker (R-WI). Gov. Walker's budget plan and the union reaction to it are a microcosm of America right now. The question of what role, if any, public sector unions should have is a question America can no longer ignore.

First, a little background:

"Big Labor" made their first major attempt at public employees in 1919, when the Boston "policemen's club" petitioned for affiliation with the American Federation of Labor (AFL). The Police Commissioner prohibited officers from joining, but the AFL recognized the Boston Police Union anyway, and they called a strike one month later. The Commissioner fired the striking officers and announced they would not be rehired. When Gov. Calvin Coolidge sent in the National Guard to replace the strikers, AFL President Samuel Gompers demanded Coolidge dismiss the Commissioner and reinstate the officers. Coolidge refused, saying: "There is no right to strike against the public safety by anybody, anytime, anywhere." He later wrote that he acted with "faith that the people would respond to the truth." In fact, the people responded so favorably that Coolidge was elected president just three years later.

Coolidge was succeeded by Herbert Hoover, who was followed by Franklin D. Roosevelt, who was no fan of public employee unions. "The process of collective bargaining, as usually understood, cannot be transplanted into the public service," Roosevelt wrote in 1937, "the employer is the whole people, who speak by means of laws enacted by their representatives in Congress." (Hold that thought, we will come back to it.)

It was Robert Wagner (mayor of New York City) who, by a 1958 executive order, authorized city employees to form a union. Pres. John F. Kennedy followed in 1962 by allowing federal workers to unionize.

How did that work out for the unions?

Private sector union membership had already peaked, at nearly 36% of the US workforce, in 1953 and had already begun a decline that continues to its current 12% (in some areas, 7%). Five years after the peak, public employees began organizing and union membership continues its steady rise, now at 36% of federal civilian employees [Bureau of Labor Statistics, US Department of Labor] [2].

One cannot speak with certainty that the timing of this political paradigm shift was intentional, but two implications are clear: Union leaders saw the handwriting on the wall and began looking for a new market. A Democratic mayor and a Democratic president conveniently provided that new market – a market that is now totals more than 50% of all union members.

This growth is not surprising when added to a monetary fact: The 2008 average compensation (wages and benefits) for federal civilian employees was $119,982, compared to an average of $59,908 in the private sector [Bureau Economic Analysis, Department of Commerce].

Of course, there are growing pains. To earn the dues, unions have to win elections to represent workers. In California, a recent contract vote went way overboard. The Service Employees International Union (SEIU) represents many healthcare workers in California. Following a severe internal dispute, a new organization – the National Union of Healthcare Workers (NUHW) – was created. A competition ensued to represent California healthcare workers. NUHW is now suing SEIU over harassment of NUHW supporters:

One plaintiff, Beverly Griffith, a former administrative vice president of SEIU-UHW who worked at Alta Bates Summit Medical Center in Oakland, said 'five SEIU agents' followed her at the hospital in February 2009, 'yelling at her and preventing her from doing her work.'

. . . [From the NUHW newsletter:] SEIU spent an estimated $10 million on attack mailings, robo-calls, TV and radio ads, and 1,000 paid staff flown in from across the country, but failed to win enough support from workers to win the election without breaking the law. Homecare providers reported scores of incidents of voter intimidation, illegal threats, and ballot manipulation by SEIU staff. In addition, delays by the State Mediation and Conciliation Service (SMCS) in sending replacement ballots could have disenfranchised hundreds of providers whose ballots were not counted because they arrived after the June 15 deadline.

. . . On Feb. 25, 2010, SEIU staff disrupted a group of healthcare workers and union supporters meeting peacefully in the cafeteria of Garden Grove Hospital. [A] video shows SEIU staffer Lisbeth Castillo yelling at a hospital employee and spouting obscenities before lunging at an NUHW volunteer and striking him. [3]

The article makes no accusations against NUHW by SEIU, so counterclaims cannot be examined. The point is not the merits of the charges. Government workers pay dues to support these unions. Unions are engaging in expensive lawsuits. Even if state governments can avoid direct involvement in these lawsuits, taxpayer money paid to government workers ends up funding these lawsuits, meaning everyone in the state ends up supporting this union-on-union fight.

There is also the conduct question: If these charges are true, are these unions the people we want representing civil servants? Current events in Wisconsin suggest these charges could be true. Certainly, these are not the only states in which such accusations have been made.

How has it worked out for the public?

George Meany, legendary AFL-CIO president, said government "is a monopoly not subject to the discipline of the marketplace. Allowing those workers – many already protected by civil-service law – to organize and bargain collectively might ultimately give them the power to hold politicians and taxpayers hostage."

Is Wisconsin being held hostage?

The economic forces that helped sunder private unions are now, in a different sense, looming over their public counterparts. Governors are attempting to balance state books. Wisconsin faces a $137 million shortfall this year and a $3.6 billion deficit over the next two years. But unlike the factories of decades past, some employers (the Wisconsin governor) are asking unions not only for concessions (which have been agreed to) but to amend the structure of public unions themselves.

Republicans argue that only structural union reform will sustain budget reform. Labor says this is union busting of the old fashioned sort – Republicans siding against labor because labor sides with Democrats.

This is why tens of thousands of union members have protested in Madison, Wisconsin, for two weeks. It's why Democratic lawmakers fled their state to filibuster the legislation. Wisconsin Republican Governor Scott Walker seeks to end collective bargaining for most public union wages, among other measures. Other states, like Ohio and Iowa, are considering similar legislation. [4]

In other words, the people can't afford what previous Democrats promised the unions, so the Governor demanded necessary belt-tightening, so Democrats refused the call to quorum, preventing the legislature from conducting the business of the State of Wisconsin. Sounds like a hostage situation to me.

Michael Barone grew up in heavily-unionized Detroit, Michigan, and says he assumed unions were part of the natural order of things. Time has changed his view; in 2010, he reported that, "One-third of last year's $787 billion stimulus package was aid to state and local governments – an obvious attempt to bolster public-sector unions. And a successful one: While the private sector has lost 7 million jobs, the number of public-sector jobs has risen. The number of federal government jobs has been increasing by 10,000 a month, and the percentage of federal employees earning over $100,000 has jumped to 19 percent during the recession." [5]

The tremendous windfall by state and local governments in 2009-10 is no coincidence – unions are well-known for supporting the Democratic Party, which won the White House and majorities in both chambers of Congress in 2008. I have heard estimates as high as 90% of union donations go to Democratic candidates and causes. Are 90% of union members Democrats? I doubt it. Though reliable demographics are lacking, it is certain that union members include Democrats, Republicans, Libertarians, Greens and, of course, persons not affiliated with any party. If unions are even close to the national statistics on party registration, the unaffiliated are the largest group.

Regardless of the actual numbers, millions of union members are forced to support financially candidates they do not support philosophically. That's not what America is about. Public sector unions are attempting to control which individuals become the negotiators (public office holders) for their employers (the people). That's conflict of interest, a legal principle by which many have been forced to recuse themselves from legal and political processes.

To summarize:

"My principled objection to public-sector unions is that their powers limit [republican] sovereignty over taxation and public spending in a way that advantages some citizens at the expense of others – in a way that makes fiscal exploitation more, not less likely. Should they have grievances about their cut of the public budget, non-unionized government employees have recourse to the exact same [republican] institutions as do other groups of citizens, which is as it should be. If we cannot trust [republican] bodies to treat government workers fairly, then we cannot trust [republican] bodies generally," says The Economist. [6]

(I have replaced "democratic" with "republican" in this comment because, as we all should know, the United States and the several states are republics, not democracies.)

You may think this a series of rambling, disconnected thoughts. To a point, it is, because this discussion is far too broad for such a forum as this. My goal is simply to introduce this debate. You will also notice that private sector unions are specifically and completely excluded from this discussion. That's intentional; private companies are owned by their stockholders, and I am not one of them, so it's none of my business. I leave them to succeed or fail as they will. I leave to you to decide what success they are having, given the fact that union membership has steadily declined over the last half century.

Public sector employee unions are different. As a US citizen, I am a stockholder, one of about 300,000,000. I like The Economist's concept – we really ought to trust the legislative branches (both federal and state) to treat public employees properly. There's only way that will be possible – the stockholders (the people) must place individuals in those legislatures that are trustworthy. That means a lot of people need to lose their jobs. Fortunately, those people are not represented by a union.

Thanks for listening, tune in next week for another rant.

[1]    Peter A. List, editor, "Is the White House Helping to Orchestrate a National Union Uprising? You be the Judge" Labor Union Report; http://www.laborunionreport.com (22 February 2011).
[2]    For more detail, read Kevin C. Brown, "Public-Sector Unions" MRZine, a project of the Monthly Review Foundation; http://mrzine.monthlyreview.org/2010/brown200510.html May 2010). (20 May 2010).
[3]    Jane Jamison, "California Gov’t Unions Litigate for Power Using Taxpayer Millions," Uncoverage.net; http://www.uncoverage.net/2011/02/california-govt-unions-litigate-for-power-using-taxpayer-millions/ (27 February 2011)
[4]    David Paul Kuhn, "Big Labor's Last Stand," Real Clear Politics; http://www.realclearpolitics.com/articles/2011/
02/27/big_labors_last_stand_scott_walker_public_unions_political_stakes_109045.htm (27 February 2011).
[5]    Michael Barone, "Public-sector unions bleed taxpayers," Washington Examiner; http://washingtonexaminer.com/politics/
public-sector-unions-bleed-taxpayers#ixzz1FBTW1N5H (7 February 2010).
[6]    "Free Exchange," a blog of The Economist; http://www.economist.com/blogs/freeexchange/2011/02/labour_unions (23 February 2011).