Tag Archive for: public sector unions

Politicians Who Accept Government Union Money Betray the Public

Public sector unions should be illegal. They have very little in common with private sector unions, which, properly regulated, play a vital role in society. The differences between public sector and private sector unions are significant. For example:

1 – Private sector unions cannot be unreasonable in the demands they bring to negotiations with management, because if they ask for too much, they will bankrupt the company. Public sector unions, on the other hand, know that government agencies can simply raise taxes to fund their demands.

2 – Private sector unions negotiate with management that is either elected by shareholders or represents private owners of the company. Public sector unions negotiate with politicians who are often elected using campaign contributions that came from those unions. Politicians know that if they reject union demands, the unions will fight their reelection and replace them with a politician who will do what they want.

3 – Private sector unions are not generally pushing a political agenda that goes beyond their pay and benefits, their work conditions, and the practices specific to their industry. Public sector unions are unified in their drive for higher taxes, and more tax revenues allocated to pay and benefits for public employees. Increasingly, equally significant, and unlike private sector unions, public sector unions share an ideological agenda that favors bigger government.

The inherent political agenda of public sector unions is more pay and benefits for public employees, work rules that result in more government employees than might actually be necessary to efficiently perform government services, and more government programs and agencies in order to hire still more government employees who become union members paying union dues.

This is perfectly understandable. Organizations of all types seek to expand and grow. But translated into to the public sector, it means the political agenda of public sector unions is inherently in conflict with the public interest. They want to grow government, and when government programs fail, they want to grow government even more to fix them. And they are powerful enough to pursue this exact agenda, time after time.

The consequences in union-controlled California are obvious: high taxes, punitive regulations, financially stressed cities and counties, failing schools, and crumbling, inadequate infrastructure, to name a few.

These facts lead to a logical and completely nonpartisan conclusion – public sector unions should be illegal. And if they’re not illegal, than at the least, they should be exposed. Politicians of all parties should be willing to stand up to these unions, to refuse to accept their campaign contributions, and to explain to the public that public sector unions are NOT the same as private sector unions.

Any Conservative Taking Public Sector Union Money is NOT a Conservative

While opposing unions ought to be a nonpartisan issue, it is an issue that ought to be of particular concern to conservatives. After all, while liberals ought to be appalled at the inefficiencies introduced to government by the public sector union agenda, they’re not necessarily opposed to bigger government. But for conservatives, who support limited government, accepting public sector union money and endorsements is heresy. It is a violation of the prime directive. It demands expulsion.

Unfortunately, engaging in politics in California requires big money, and public sector unions have a lot of it. Approximately 466,000 people live within the average State Assembly District; twice that many live within the average State Senate District in California. Congressional Districts hold around 747,000 people, less than a State Senate District. And the big money to pay for these big races is all leaning in favor of big government liberals. So if you can’t beat them, join them?

This might explain the actions of Republican Assemblyman Tyler Diep, representing the 72nd Assembly District in Orange County. Now accepting contributions for his 2020 reelection campaign, Diep has already accepted over $20,000 from unions, most of them public employee unions. In return, Diep has already publicly embraced these unions. In one recent Tweet, he stated he is “proud to represent the many members of the Orange County Employees Association.”

It’s worth wondering whether or not Tyler Diep, a 36 year old Vietnamese immigrant, is fully aware of the havoc public employee unions have wrought on California’s politics. The Orange County Employees Association, for example, is affiliated with the Costa Mesa City Employees Association, which was bitterly opposed to the reform coalition that for a brief time held a majority on the Costa Mesa city council.

These reform minded councilmembers attempted to rein in the out-of-control pension costs and other compensation gaming that was breaking the city. But they were eventually outgunned and driven out of office because of the relentless onslaught of public sector union money. Public sector unions collect and spend over $800 million per year in California. No other special interest comes even close. And their agenda, invariably, is more money, more benefits, more work rules, and bigger government.

Things are back to normal in Costa Mesa these days. A pro-union majority controls the city council. The average full time firefighter in Costa Mesa now collects $256,000 per year in pay and benefits. Let that sink in. Two hundred and fifty six thousand dollars per year in pay and benefits. Is that unbelievable? Then download the spreadsheet – if you find any inaccuracies, please comment. Can taxpayers afford this, particularly since those costs will rise sharply over the next few years as CalPERS enforces their plan to nearly double required pension contributions?

Did Diep, whose district is adjacent to the one that incorporates Costa Mesa, think about this when he launched this Tweet, showing him rubbing elbows with members of Firefighters Local 3631? Has Assemblyman Diep thought about how he’ll stare down these union donors, and tell them he’s going to support a state constitutional amendment to right-size public sector pensions?

Everyone respects and appreciates firefighters, but taxpayers cannot afford to pay them an average pay and benefits package worth over quarter-million dollars per year. Assemblyman Diep lives in the city of Westminster, where the median household income is $60,426 per year. That is less than one-fourth what Costa Mesa’s full time firefighters make. It is unnecessary and unfair to taxpayers to continue to pay firefighters a quarter-million per year, no matter how much we respect them.

The reason they are over-compensated, along with most public employees, is because of the money they spend on political campaigns to elect the politicians with whom they then negotiate their labor agreements. As a former city councilman living in Orange County once said: “If I vote against that contract, the unions will spend a million dollars to oppose me in the next election – who else is going to come up with a million dollars?”

The Leftist Agenda of California’s Public Sector Unions

If the political problems with firefighter unions were limited to arguing over compensation, that would be quite enough. But earlier this year, California’s firefighters, in an act of stupendous and misguided arrogance, actually marched in solidarity with the United Teachers of Los Angeles. Is it financial ignorance, or actual adherence to a leftist agenda that motivated these firefighters to commit what many of us would consider the ultimate act of betrayal?

California’s children are California’s future, and teachers union leaders have all but destroyed the quality of education these children receive. They oppose charter schools, they oppose school choice, they oppose vouchers, they oppose extending tenure requirements, they oppose reform of work rules governing layoff and dismissal policies, and they support curricula that indoctrinates instead of educates.

Public safety unions may be making public safety too costly, but they have not destroyed the effectiveness of their own professions. The teachers union is guilty of precisely that crime – they have destroyed California’s public schools. Firefighters should be ashamed of having anything to do with the teachers union.

And Assemblymember Diep, particularly if he considers himself a conservative, should be ashamed of having anything to do with public sector unions. He should never accept another dime in donations from any of them. And before he even talks or meets with them, he should ask THEM to sign the following pledge:

THE AMERICAN PUBLIC SERVANT PLEDGE

(1) Americans First: We recognize that the interests of the American citizens we serve come first; before the interests of the government, government employees, or non-citizens.

(2) Citizens Before Government: We understand that sometimes government policies benefit ourselves and our union more than they benefit the general public, and we will always put the public interest before the interests of ourselves or our unions.

(3) Shared Sacrifice: During times of economic hardship or declining budgets, we are willing to make reasonable sacrifices, proportionate to what the general public is enduring.

(4) Same Rules: We do not expect our union to protect us if we have engaged in behavior on the job – through incompetence, negligence, or criminality – that would get us fired in the private sector, and we expect our union to refrain from protecting bad behavior of any kind.

(5) Same Benefits: We realize that our pension benefits far exceed private sector norms, that they are financially unsustainable and unfair to taxpayers. Consequently, for work we have not yet performed, we support reductions to our pension benefit accruals to pre-1999 multipliers.

(6) Political Neutrality: As public servants our calling is to be nonpartisan and politically neutral, and we expect our unions to limit their activities to collective bargaining.

How Vision Can Overcome Money

Being a conservative in California has to mean something. If you take money from public sector unions, the chief engineers of California’s decline, then being a limited government advocate, i.e., a conservative, means nothing.

There are two ways to cut through an overwhelming financial advantage. One is by being controversial. The other is by having a compelling vision. Controversy works quite well, as President Trump proved in 2016 when he beat 16 other candidates to secure the Republican nomination for President. Today Trump dominates the news cycle by feeding an infantile news corps Tweets that trigger Pavlovian responses which, if he were purchasing airtime, would by now have cost hundreds of millions, if not billions of dollars.

You don’t have to be as controversial as President Trump to get air in California. Just tell the truth, then offer solutions, and let the media shriek and howl with indignation. Here are just few such nuggets:

(1) Truth: Public sector unions are an abomination to our democracy. Solution: They should be illegal.

(2) Truth: Overwrought environmental laws are the reason housing and utility costs are unaffordable. Solution: Many of them must be repealed.

(3) Truth: The teachers union has destroyed K-12 public education. Solution: School choice, school vouchers, charter schools, work rule reform, and eliminating teachers unions will restore quality and cost efficiencies to California’s K-12 educational system.

(4) Truth: Public sector pensions are too generous and too expensive. Solution: Public sector employee retirement benefits should be converted from pensions into Social Security, just like the citizens they serve.

Assemblyman Diep, along with anyone else, of either party, in California’s state legislature, is invited to proclaim these truths, and these solutions.

Assemblyman Diep, along with anyone else, of either party, in California’s state legislature, is also invited to offer the “public servant pledge” to anyone who wants to endorse them, especially the leadership of public sector unions.

Doing this would require personal courage and political vision. And while these steps are actually mild, moderate policy innovations, they would provoke vehement outrage from the establishment liberals and their media allies. This unwarranted and very public outrage, in turn, would awaken California’s voters, who would realize they have been conned.

They would realize that rather than being the planet killing bigots they were told to fear, conservatives are actually the people fighting for THEM, and liberals are the liars who hid behind slander, while they looted the resources of the entire state and oppressed its people.

This article originally appeared on the website of the California Policy Center.

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Public Sector Unions – The Other Deep State

When government fails, public-sector unions win. When society fragments, public-sector unions consolidate their power. When citizenship itself becomes less meaningful, and the benefits of American citizenship wither, government unions offer an exclusive solidarity.

Government unions insulate their members from the challenges facing ordinary private citizens. On every major issue of our time; globalization, immigration, climate change, the integrity of our elections, crime and punishment, regulations, government spending, and fiscal reform, the interests and political bias of public-sector unions is inherently in conflict with the public interest. Today, there may be no greater core threat to the freedom and prosperity of the American people.

In the age of talk radio, the Tea Party movement, internet connectivity, and Trump, Americans finally are mobilizing against the uniparty to take back their nation. Yet the threat of public-sector unions typically is a sideshow, when it ought to occupy center stage. They are the greatest menace to American civilization that nobody seems to be talking about. Ask the average American what the difference is between a government union, and a private sector union, and you’re likely to be met with an uncomprehending stare. That’s too bad, because the differences are profound.

While America’s labor movement has always included in its ranks varying percentages of crooks, Communists, and thugs, it derived its mass appeal based on legitimate and often compelling grievances. Most of the benefits American workers take for granted—certainly including overtime pay, sick leave, and safe working conditions—were negotiated by private sector unions.

Over time, private sector unions overreached, negotiating pay and benefits packages that became unsustainable as foreign manufacturers slowly recovered from the devastation of World War II and became competitive. The diminished influence of private sector unions parallels the decline in American manufacturing, a decline only partially caused by insufficient flexibility on the part of union negotiators in a changing world. Properly regulated, private sector unions may still play a vital role in American life.

Differences Between Public and Private Sector Unions

Public-sector unions are a completely different story. If Americans fully understood the differences between public and private sector unions, public-sector unions would probably be illegal.

Public-sector unions do not negotiate with management accountable to shareholders, but instead with politicians whom they help elect and, therefore, are accountable to the unions. Moreover, politicians, unlike corporate executives, typically occupy their offices for shorter periods of time. And politicians, unlike corporate executives, don’t own shares that might be devalued after they leave office due to decisions they made while in office.

Not only are politicians far more accountable to the unions they negotiate with than to the people they serve, but the consequences of giving in to outrageous demands from public-sector unions are much less immediate and personal for the politicians. When a corporate executive gives in to union demands that are unsustainable, the corporation goes out of business. Union negotiators know this, and in the private sector, the possibility of business failure tempers their demands. But the survival of government agencies doesn’t depend on efficiently competing in a market economy where consumers voluntarily choose to purchase their product or service. When government agencies incur expenses that exceed revenues, they raise revenues by increasing taxes. Consumers have no choice but to pay the higher taxes or go to jail.

If electing their own bosses and compelling taxpayers to guarantee revenue sufficient to fulfill their demands weren’t enough, public-sector unions have another advantage denied private sector unions. They operate the machinery of government. Their members run our public schools, our transportation agencies, our public utilities, our administrative bureaucracies including code enforcement and construction permitting, our public safety agencies; everything. This confers countless unique advantages. Depending on the intensity of the issue, the percentage of unionized government employees willing to use their positions as influencers, educators, gatekeepers, and enforcers may vary. But within the permanent bureaucracy of government, it doesn’t take a very large minority of committed operatives to wield decisive power.

Public-sector unions epitomize the establishment. Politicians come and go. But like the deep state, public-sector unions are permanent, embedded in the bureaucracy, running the show.

How Public-Sector Unions Arose

While the rise of public-sector unions paralleled the rise of the private sector labor movement in the United States, it lagged behind by decades. Apart from the postal workers’ unions that emerged in the late 19th century, or the Boston police strike of 1919—which was decisively suppressed by then-Massachusetts Governor Calvin Coolidge—there wasn’t much support for public-sector unions in the early 20th century.

During the 1930s, as private sector unions acquired federal protections via the Wagner Act of 1935, public-sector unions remained unusual apart from the postal workers. Historians disagree about President Franklin D. Roosevelt’s position on public-sector unions, but it is reasonably clear that even if he did support them, he did not think they should have the degree of protection afforded private sector unions. His most quoted remark on the topic was in a 1937 letter to the president of the National Federation of Federal Employees:

“All Government employees should realize that the process of collective bargaining, as usually understood, cannot be transplanted into the public service. It has its distinct and insurmountable limitations when applied to public personnel management. The very nature and purposes of Government make it impossible for administrative officials to represent fully or to bind the employer in mutual discussions with Government employee organizations. The employer is the whole people, who speak by means of laws enacted by their representatives in Congress. Accordingly, administrative officials and employees alike are governed and guided, and in many instances restricted, by laws which establish policies, procedures, or rules in personnel matters. Particularly, I want to emphasize my conviction that militant tactics have no place in the functions of any organization of Government employees. Upon employees in the Federal service rests the obligation to serve the whole people, whose interests and welfare require orderliness and continuity in the conduct of Government activities. This obligation is paramount. Since their own services have to do with the functioning of the Government, a strike of public employees manifests nothing less than an intent on their part to prevent or obstruct the operations of Government until their demands are satisfied. Such action, looking toward the paralysis of Government by those who have sworn to support it, is unthinkable and intolerable.”

The fact that FDR, a pro-labor Democrat, had a nuanced position on public-sector unions, believing that collective bargaining had “distinct and insurmountable limitations when applied to public personnel management,” ought to be strong evidence that they are problematic. Not quite 20 years later, in 1955, none other than George Meany, founder and long-time president of the AFL-CIO, flatly stated that it was “impossible to bargain collectively with the government,” and that the AFL-CIO did not intend to reach out to workers in that sector.

But where common sense and propriety inhibited some of the most illustrious supporters of organized labor from unionizing the public sector during the first half of the 20th century, circumstances changed during the century’s latter half. Corruption, opportunism, and a chance to achieve decisive power for the Democratic Party gave rise to new laws that enabled unionized government.

The modern era of public sector unionism began in the late 1950s. Starting in Wisconsin in 1958, state and local employees gradually were permitted to organize. Today, there are only four states that explicitly prohibit collective bargaining by public employees, and only 11 additional states place any restrictions on collective bargaining by public employees.

According to the U.S. Bureau of Labor Statistics, 7.2 million employees in the public sector belonged to a union in 2018, compared with 7.6 million workers in the private sector. Union membership among public-sector workers is more than five times higher (33.9 percent) than that of private-sector workers (6.4 percent). After a slow start, public-sector unions now wield far more power than their private-sector counterparts.

How Public-Sector Unions Fought for Clinton in 2016

Everyone knows that in 2016, Donald Trump—and Bernie Sanders, for that matter—were not “establishment” candidates. But what is that? America’s so-called establishment today is a political alliance favoring bigger, more authoritarian government at all levels—local, state, federal and international. It unites transnational corporations, global financial interests, and government unions. It is an alliance that finds its primary support from members of these elites and the professional classes who serve them, and acquires a critical mass of additional popular support by pandering to the carefully nurtured resentments of anyone who is deemed a member of a “protected status group.”

While “protected status groups” now include nearly everyone living everywhere in America, those people living in urban areas are more susceptible to the union-sponsored propaganda of identity politics, because they are more exposed to it.

For over a generation, especially in California’s urban centers, but also in Chicago, Seattle, Miami, New York City, and hundreds of other major American cities, government unions have exercised nearly absolute control over the political process. This extends not only to city councils but also to county boards of supervisors, school boards, and special districts ranging from transit systems to departments of water and power. Most government funding is spent at this local level. Most government jobs are at this local level. And the more local these jurisdictions get, the more likely it is that only the government unions have the money and the will to dominate the elections.

In America’s cities, where the union agenda that controls public education trains Americans to be hypersensitive to any alleged infringements on their “identity,” big government is presented as the guardian of their futures and their freedoms. In America’s cities, where poor education combined with over-regulation has resulted in a paucity of good jobs, welfare and entitlement programs are presented as the government’s answer. And the more poverty and social instability we have in America, the bigger government gets.

Take another look at this map that depicts the absolute vote margins by county in 2016. From viewing this map, it is evident that the split that was exposed on November 8, 2016, was not simply urban versus rural. It was government union-controlled areas versus places relatively free of government union influence.

From the above map, only a few places stand out as decisive factors in Clinton’s popular vote victory—Seattle, Miami, New York City, and most prominently, Los Angeles and Chicago.

In Los Angeles County, Clinton received 1,893,770 votes versus 620,285 for Trump. In Chicago’s Cook County, Clinton received 1,528,582 votes versus 440,213 for Trump. Let that sink in for a moment. If just a few blue counties—not blue states, blue counties—were taken out of the equation, the popular vote would have been a toss-up. The political systems and the public schools in all of these blue counties are controlled, many informed observers would say absolutely, by public-sector unions.

Government Union Agenda vs. the Public Interest

It would be cynical and unfair to suggest that politically savvy members and leaders of public-sector unions are consciously supporting policies that undermine America’s democracy, prosperity, freedoms, and culture. But that’s what’s happening.

It doesn’t matter all that much what union members and leaders think; the institutional momentum of their organizations have this effect. The primary agenda of a government union, like any organization, is to survive and thrive. For government unions, this means to acquire more members, collect more dues, and acquire more power and influence. The only way this can be accomplished is for government to expand.

This is where government union reform should be a nonpartisan issue. Because even big-government advocates have the expectation that expanded government programs will be effective. But government unions actually become more prosperous and more powerful when government fails—and, for that matter, when society fails. The worse things get, the more calls there are for new government programs to solve them. The bigger the crisis, the greater the opportunity. And at the forefront of these calls for bigger government to solve every problem are the government unions, using all of their considerable power and influence to make the call.

We see this at the local level all the time. Thousands of local tax and bond measures are placed on ballots across the nation every election cycle, as well as between elections, during primary season, and in special elections. Opposing these proposed new taxes and bonds are the usual hardscrabble assortment of local anti-tax activists; typically a handful of volunteers with almost no money. Supporting these new taxes and bonds are public-sector unions, with standing armies of professionals and, for all practical purposes, unlimited funds. Also supporting the new taxes are the private contractors that stand to gain from the increased spending, as well as the government bureaucrats themselves, who use municipal budgets to fund “information outreach” to voters. But for these unions, the victory is sealed when the new taxes and bonds are approved. If the new revenue they collect and spend fails to solve the problem, it doesn’t really matter.

At the state and national level, it is easy to see the influence of government unions corrupts public policy.

Immigration and climate change are core issues where the inherent interests of government unions are in conflict with the public interest. Immigration to the United States in the 21st century should consist of highly skilled and highly educated immigrants, since America already has millions of unskilled residents who need to choose jobs over welfare. But while the American people would benefit by inviting scientists, engineers, and doctors to immigrate and fill advanced positions for which there is a shortage of qualified applicants, it would not benefit government unions.

The more difficulty America has in assimilating newcomers, the more government jobs are created. If immigrants don’t speak English, public schools must hire teachers with foreign language certifications. If they live in poverty, public schools must develop free-meal programs. If these immigrant communities fail to achieve the educational results that make them employable, the government will need more social workers and welfare administrators. If the ongoing poverty breeds higher crime rates, more police, judges, bailiffs, prison guards, and probation officers are the answer. The worse things get, the more government employees and government benefits become necessary.

And, of course, as these communities fail to become prosperous, they are taught by leftist, unionized social studies teachers that it’s not their responsibility, but rather the fault of their white male oppressors, and they’d better vote for Democrats in order to guarantee their reparative handouts. And to enforce “diversity” quotas—unionized government bureaucrats.

With climate change, the conflict between government unions and the public interest is equally stark. Here again, there is also a strong connection between connected government contractors and the public-sector unions. Instead of building subsidized housing, special needs school facilities, and more prisons—which come with marginally assimilable immigrants—these contractors supply solar farms, wind farms, “smart” appliances, and everything else that comes with mandated climate change mitigation. It doesn’t matter if any of these mandates accomplish anything, so long as profits are made. And overseeing it all are the government unions, who hire more code inspectors, environmental consultants, and a byzantine monitoring and enforcement bureaucracy.

While immigration and climate change are core drivers of government union endorsed government expansion, they aren’t the only factors. In every area of policy and spending, government unions benefit when things are harder for ordinary families and small businesses. In all areas, taxes, borrowing, spending, and regulations, the more there is, the more the government unions benefit.

The Financial Power of Public-Sector Unions

One of the primary reasons government union activists exercise influence disproportionate to their numbers is because behind these activists are billions of dollars in annual dues, collected from government payroll departments across the nation.

In California alone, government unions collect and spend nearly $1 billion a year. Nationwide, government union revenues are estimated to total at least $6 billion per year. Apart from private sector unions, no other political special interest enjoys access to a guaranteed, perennial torrent of money of comparable magnitude. This money is not just spent on federal elections; most of it is directed at tens of thousands of state and local election campaigns.

With this perpetual torrent of funding, fueled almost exclusively through membership dues, government unions engage the permanent services of the finest professionals money can buy. While much of their spending is explicitly political, even more is spent on community organizing and “educational” advocacy which is not reportable as political spending. Thousands of lobbyists, political consultants, grassroots organizers, public relations firms, opposition researchers, academic researchers, and other freelancers are on-call to these unions.

If you study money in politics, you soon realize there is a rough parity between major political donors who contribute to causes and candidates on the Right versus those who contribute to the Left. But the election of Donald Trump in 2016 revealed the so-called Right to be nearly as bad as the Left, as libertarians and NeverTrump Republicans abandoned their base. This abandonment was especially obvious among donors, whose only apparent unifying political theme was lower taxes for wealthy people. Trump and his supporters exposed the libertarian and NeverTrump Right for being just as committed as the establishment Left was to importing workers to drive down wages and exporting jobs to increase corporate profits. As a result, donations to Republicans, while remaining roughly at parity with donations to Democrats, were for the most part not supporting an America First agenda.

An illustration of how this schism within the American Right, and especially among big libertarian donors, persisted into the 2018 midterms is exemplified by their withdrawal of key financial support for pro-Trump candidates. And here’s where the union money becomes decisive. Into the political conflict between Left and Right, between Democrat and Republican, into a battle for financial supremacy already skewed, because half the Republican donors are now exposed as being more committed to a uniparty establishment than to Republican voters, ride the unions. And almost all of the union money goes to Democrats.

The lack of parity in political power and political advocacy becomes further lopsided when accounting for the role of nonprofits and government bureaucracies. Much has been made of the educational nonprofits supposedly beholden to right-wing donors. Their collective spending is indeed impressive, led by heavyweights like the Heritage Foundation, along with well-known stalwarts such as the Cato Institute, the Reason Foundation, and several others at the national level along with a growing number of state focused organizations such as the many member organizations of the State Policy Network.

But contrary to the wailing of the establishment media and left-wing pundits, the influence of these organizations is overstated.

First, many of them must adhere to orthodox libertarian principles in order to keep their donors. This makes them useless on immigration and trade, which are two of the defining issues of our time.

Second, because arrayed against these organizations is the entire rest of the nonprofit universe, which while mostly self-declared as nonpartisan, is in reality a part of that great mass of establishment organizations that have reached a consensus on open borders, “free” trade, and climate change activism consistent with the big government coalition: corporations, government unions, and the financial sector.

To provide one example, the combined budget of just a partial list of the major U.S.-based environmentalist nonprofits and foundations totaled over $4 billion per year as of 2018.

The Financial and Cultural Consequences of Unionized Government

Spokespersons for government employee unions perpetuate a myth of staggering absurdity and tragic consequences—that they are protecting hard-working Americans from wealthy corporations and wealthy individuals.

The reality is that government employee unions are focused on one thing: expanding government employee pay, benefits, and privileges. This requires expanding government, and that priority comes in front of everything else, including the cost to society at large. In states where government unions have taken control, such as California, expansive environmentalist regulations have made prices for housing and utilities the highest in the nation. In California, America’s poster child for union control, excessive compensation packages for unionized government workers have resulted in chronic deficits and accumulating state and local government debt that by some measures already exceeds $1.5 trillion. High taxes and over-regulation have made California consistently rank as the most inhospitable place in the nation to run a small business.

Exactly how does any of this protect the poor from the wealthy?

It doesn’t, of course. But the deeper story is how government employee unions are not only failing to “protect” the aspiring multitudes in California, or anywhere else in America, but are in fact enabling the wealthy special interests they claim to protect us from. The most entrenched and massive corporate entities are not harmed by excessive regulations, because they can afford to comply. An obvious example would be calls to increase the minimum wage– a movement almost exclusively restricted to states with powerful public-sector unions. Large corporate entities like McDonald’s will simply automate a few positions, tinker with the menu and recipes, incrementally raise prices, and go forward. Large corporations can hire attorneys and lobbyists, they have access to capital, and when the smaller players go out of business they gain market share. They benefit from over-regulation, but the consumer and workers suffer.

Less obvious but far more consequential is how the financial sector also benefits from an overbuilt, financially irresponsible, unionized government. When excessive rates of pay and benefits consume government budgets, financial institutions step up to extend debt. Bond underwriters collect billions each year in fees to issue new debt and refinance existing debt. When excessively generous pension plans are granted to unionized government employees, pension funds pour hundreds of billions into Wall Street investment firms, earning additional billions in fees. As for “carbon emissions auctions,” also rolling out inexorably in blue states, as that ramps up, virtually every BTU of fossil fuel energy consumed will put a commission into the hands of a financial intermediary. Trillions are on the table.

Unionized government hides behind environmentalism to justify increasing pay and benefits instead of investing in infrastructure—which after all is environmentally incorrect. As the cost-of-living inevitably rises through artificial constraints on the supply of land and energy, the unionized government workers negotiate even higher pay and benefits to compensate, and the corporate monopolies that control existing supplies of land and energy get more revenue and profit. And of course the resultant asset bubble is healthy both for pension funds and wealthy investors, even as low and middle-class private-sector workers are priced out of owning homes—or even automobiles—and struggle to make ends meet.

It is crucial to perceive the irony. Government unions empower the worst elements of the capitalist system they persistently demonize. The crony capitalists and speculative financial interests benefit from an overbuilt, over-regulating, state and local government populated with overpaid unionized workers. Those virtuous capitalists who want to compete without subsidies are successfully lumped together with these robber barons, discrediting their support for reform. Those small business owners who want to grow their enterprises are harassed and marginalized.

If government employee unions were illegal, the most powerful political force in California, New York, Illinois, Massachusetts, and a host of other smaller blue states would cease to exist. But losing these government unions wouldn’t “turn government over to the corporations and billionaires.” Quite the opposite. It would take away the ability of those corporations and billionaires to collude with local and state government unions who currently control the lawmakers. It would force them instead to compete with each other, lowering the cost of living for everyone. It would restore balance to our debate over environmental policy, energy policy, and infrastructure investment.

Wherever government unions become as powerful as they have become in California, their domain increasingly becomes a feudal state, where the anointed and compliant corporations build monopolies, government workers lead privileged lives, the rich get richer, the middle class diminishes, and the poor become dependent on government. Nobody who is serious about reversing California’s decline into feudalism—or America’s potential decline—can ignore the fundamental enabling role unionized government is playing.

It is important to emphasize that the most ominous consequence of unionized government is its complicity in the asset bubbles that, if abruptly deflated, threaten to plunge the United States, if not the world, into a liquidity crisis. Government unions in the United States control the directorships managing trillions of dollars of public employee pension funds. These pension funds are the biggest single player in the U.S. equity markets. They are also major investors in real estate and bonds. One may argue all day as to just how inflated all these asset classes have become, but regardless of your stance on the question, one thing is indisputable: public employee pension funds are dangerously underfunded despite the fact that there has been a bull market in stocks, bonds, and real estate for over a decade. They will use all their influence to keep the bubbles inflated—and that includes ongoing support for extreme environmentalist regulations to create artificial scarcity of everything—houses, energy, water, food, commodities—buoying their prices which boosts profits, as well as mass immigration to create unmanageable demand for homes, also buoying prices and investor profits. The insatiable need for perpetually increasing asset values constitutes an identity of interests between public-sector unions, multinational corporations, and international investors and speculators that is as obscure as it is inviolable.

Government Union Abuses That Provoke Bipartisan Opposition

“Bipartisan” isn’t what it used to be. Now that America’s political establishment has been exposed as supporting with bipartisan unity, regardless of party, the policies of importing welfare recipients, exporting jobs, fighting endless wars, and micro-managing all forms of energy production under the pretext of saving the planet, the term “bipartisan” doesn’t evoke quite the same transcendent connotations it once did. With that noted, it remains true that with respect to public-sector unions, establishment Democrats are worse than establishment Republicans. When it comes to fighting the influence of public-sector unions, most Republicans lack the courage of their convictions, whereas most Democrats have no convictions at all.

Two exemplary issues, however, have the potential to bring Republicans and Democrats together in opposition to public-sector unions. Those issues are public education and pensions. These issues are not only capable of fostering productive, bipartisan reform efforts, but that eventuality is almost inevitable because the status-quo is not sustainable.

Public EducationIn blue states, union control over public education is almost unassailable despite strong opposition. California’s failing school districts face insolvency caused by a combination of administrative bloat and out-of-control costs for pensions and retirement health benefits. The academic achievement of California’s schools is hard to measure objectively. California’s average SAT score, 1076, places it in 34th place among states. According to a study sponsored by U.S. News and World Report, California’s K-12 system of public education was ranked 26th among states.

But this average performance obscures a bigger problem in California’s union controlled public schools. Union work rules are causing the schools in the most vulnerable communities to get the worst teachers. In 2012 a coalition of mostly Democrats filed a lawsuit, Vergara v. California, attempting to change these rules. Claiming that education was a civil right, they tried via litigation to revise three union work rules; tenure (a job for life) after only two years, dismissal rules (almost impossible to fire an incompetent teacher), and layoff rules (seniority over merit).

The impact of these three rules was, and is, a relentless migration of the worst teachers into the worst performing schools, since they can’t be fired, but they can be transferred. View the closing argumentsof the plaintiffs for a compelling description of how these three union work rules are destroying California’s public schools. In 2016, after a favorable district court ruling, the appellate court ruled againstthe plaintiffs, and California’s Supreme Court refused to hear an appeal. The schools harmed the most by these corrupt union rules are those in the burgeoning low income immigrant neighborhoods of Los Angeles, where literally hundreds of thousands of children are denied a quality education.

For better or for worse, these kids are America’s future. But who wins when society fails? The government unions win. As demographically ascendant low-income immigrant subcultures are permanently handicapped because their children got indoctrinated instead of educated, taxpayers will have to hire more unionized public servants to redistribute wealth and preserve the peace.

The good news? Increasing numbers of Americans of all ethnicities and ideologies are realizing the impact of union controlled schools is denying future opportunities to a generation of children. The battle over charter schools, home schooling, and union work rules in traditional public schools is far from over.

Public Employee PensionsWith pensions, reform is even more inevitable, because financial reality will compel reform. According to Pew Research, in 2016 state and local government pensions plans disclosed assets of just $2.6 trillion to cover total pension liabilities of $4 trillion. This understates the problem. These pension plans assume they can earn, on average, 7.5 percent per year on their invested assets, yet, as discussed, despite nearly a decade of a bull market in stocks, bonds, and real estate, these pension plans are less than 70 percent funded.

Pension finance isn’t as complicated as the experts would have you believe. What “pension liabilities” refers to is how much money would have to be invested, today, for these pension plans to earn enough interest over time to eventually pay all of the future pension benefits that have been earned so far. Think of pension assets as a growing tree, nourished by the water and sun of investment earnings, supplemented by the fertilizer of regular taxpayer contributions, and pruned each year by the payments going to retirees. If this tree is less than 70 percent of the size it needs to be, then it’s going to get pruned faster than it can grow. Eventually, there won’t be any cuttings to provide pensions to retirees.

For clarity, take the metaphor one step further. What if this undersized tree had been enjoying a decade of abundant water and sunshine—the generous investment returns of the bull market—but suddenly that changes, as it always has and always will? What if this undersized pension asset tree now has to endure years of drought and cloudy weather, stunting its growth at the same time as the pension payment pruning for retirees continue at the same pace?

This is what America’s public employee pension funds are already confronting. The tree is too small, and in response more and more fertilizer—payments by taxpayers—have to be applied to keep it alive. This data compiled by the California Policy Center explains what’s coming:

“A city that pays 10% of their total revenues into the pension funds, and there are plenty of them, at an ROI of 7.5% and an honest repayment plan for the unfunded liability, should be paying 17% of their revenues into the pension systems. At a ROI of 6.5%, these cities would pay 24% of their revenue to pensions. At 5.5%, 32%.” To restate—according to this analysis, at a 5.5 percent annual return for the pension funds, 32 percent of total tax revenue would have to go straight into the coffers of the pension funds, just to keep them solvent.”

These are staggering conclusions. Only a few years ago, opponents of pension reform disparaged reformers by repeatedly asserting that pension costs only consumed 3 percent of total operating expenses. Now those costs have tripled and quadrupled, and there is no end in sight.

The looming pension crisis is already uniting fiscal conservatives, who want smaller, financially sustainable government, and conscientious liberals, who want to protect their cherished government programs from being eliminated in order to pay the pension funds. And as out-of-control pension costs become a problem too big to ignore, it casts a spotlight on the entire question of overcompensation for unionized government employees. Government employees, on average, retire 10 years sooner and enjoy annual retirement benefits two to five times greater than private sector workers. In California, on average, they make twice as much in pay and benefits during the years they work, and veteran employees are eligible for as many as 58 paid days off per year, not including sick leave.

A harrowing example of just how skewed political discourse has become can be found in the government union campaign against California’s Proposition 6, placed on the November 2018 ballot by tax reformers. The proposition was struck down by voters, who were barraged with union-funded flyers and television ads featuring a rugged firefighter, in uniform, explaining how public safety would be jeopardized if voters approved Prop. 6. But nobody told the rest of the story, how this firefighter, as readily verified by publicly available online data, made $327,491 in 2017. That’s only a bit unusual. The average firefighter in a California city in 2015 made $200,000 in pay and benefits. It would be interesting to compile more recent data. The number certainly has not fallen.

Teachers and firefighters are our heroes. They are our role models. But the best among them are unrecognized, because the worst among them are not only nearly immune to being fired, but make exactly as much money as the best. The only thing that matters is seniority. It is likely that the finest teachers are underpaid. But overall, and especially with respect to the cost of retirement benefits, unionized public employees are overpaid, and the cost is becoming too much to bear.

These two issues, quality schools and financially sustainable pensions, represent the wedge that could eventually roll back, if not break the power of public-sector unions. Everyone cares about public schools, because their success or failure governs our children’s future. Everyone cares about public employee pensions, or will care, because if they aren’t reformed, they will bankrupt our cities, counties and states. The primary reason public schools are underperforming, and the primary reason public-sector pensions are not reformed, is because public-sector unions fight reform at every turn.

But all their power cannot deceive voters forever. Change is coming.

Fighting Back

In June 2018, in the landmark case of Janus v. AFSCME, the U.S. Supreme Court ruled that public sector employees cannot be compelled to pay anything to unions as a condition of employment, not even the so-called agency fees. In the months leading up to this case, public-sector unions made Janusout to be a catastrophe in the making, fueled by “dark money” and poised to destroy the labor movement.

In the months prior to the Janus decision, the mainstream press played up the panic. The Economist reported that “Unions are confronted with an existential threat.” The Atlantic went with “Is This the End of Public-Sector Unions in America?” Even the Wall Street Journal was caught up in the drama, publishing a report with the ominous title “Supreme Court to Decide Fate of public-sector unions.”

Maybe some union officials actually thought an unfavorable Janus ruling would destroy their organizations, but more likely, they saw it as an opportunity to rally their base and consolidate their power.

The Janus ruling has come and gone, but public-sector unions are as powerful as ever. In ultra-blue states such as California, they still exercise nearly absolute control over the state legislature, along with the city councils and county boards of supervisors in nearly every major city and county. Their control over school boards is also almost absolute.

This pattern repeats itself across the United States, especially in ultra-blue states. For example, following the 2018 midterms, fourteen states had democratic “trifectas,” where Democrats controlled both houses of the state legislature, plus the governorship. These would include the powerhouse states of California, New York, New Jersey, Massachusetts, and Illinois, along with Washington, Oregon, Nevada, Colorado, New Mexico, Maine, Rhode Island, Connecticut, and Delaware. These states have one overwhelming political variable working in their favor—the politics of their major urban centers are dominated by public-sector unions.

It has been long enough since the Janus decision to assess the initial impact. As of July 2018, unions could no longer collect “agency fees” from workers who didn’t want full membership. Comparing monthly payroll deductions from early 2018 to those from late 2018, one analysis indicated the unions were not very successful in converting these agency fee payers to full members. It is likely that the impact on public-sector unions based on losing their agency fee payers may have caused their revenue to decline by between five and ten percent. That’s a lot of money. Or is it?

In almost any other context, reducing the annual revenue of a network of political players by somewhere between $300 and $600 million per year would be a catastrophe for the organizations involved. But these are public-sector unions, which still have well over $5 billion per year to work with. Losing most of their agency-fee payers clearly had a permanent and significant impact on union revenues, but for them, and only them, it might be most accurately described as a one-time loss of manageable proportions.

The bigger impact that the Janusruling might have regards what is going to happen to their rates of full membership. It is now possible for public-sector union members to quit their unions. But will they? And if they want to, will the unions be forced to make that an easier process?

Some of the tactics the unions have adopted to make the process of quitting more difficult are being challenged in court. These cases would include Uradnik v. IFO, which would take away a public-sector union’s right to exclusive representation, or Few v. UTLA, which would nullify many steps the unions have taken to thwart the Janusruling. How those cases play out, and whether or not public-sector unions can remain accountable enough to their members to keep them in voluntarily, remains to be seen.

Public-Sector Unions and America’s Future

With America’s electorate split almost evenly between Republicans and Democrats, between liberals and conservatives, between socialists and capitalists, between Right and Left—however you want to express those polarities, it doesn’t take much to alter the equilibrium. But wherever you identify powerful forces shifting the balance, you find the public-sector unions are the puppeteer.

Should America import millions of highly skilled immigrants whose children will excel in public schools no matter what? Of course not. Private success requires no public money.

Should America reform its financial house of cards before a liquidity crisis crashes the global economy? No. Because pension solvency requires asset bubbles.

Should public-private partnerships fund new infrastructure so private investors can competitively develop new cities on America’s vast reserves of open land? Not a chance. Artificial scarcity keeps property tax revenues up, and helps prop up the real estate asset bubble.

Should incompetent bureaucrats and teachers be fired? No, because the union protects them.

To understand how intractable this problem has become, it’s worthwhile not only to identify the differences between public and private sector unions, but also the differing philosophies that guides them. To be sure, these structural differences are profound: unlike private-sector unions, public-sector unions elect their own bosses, are funded through coercive taxes instead of competitively earned profits, are rewarded by inefficiency and failure which they use as justification to expand government, and operate the machinery of government, which allows them unique powers to harass their opponents.

But these structural differences need to be viewed in the context of the ideological differences between unionized workers in the public and private sectors. These ideological differences are not absolute, but they are nonetheless very real and impact the political agenda of public-sector unions versus private sector unions. There are at least three areas of ideological differences:

Authoritarian vs. Market DrivenWorkers for the government exercise political power, whereas workers in the private sector exercise economic power. A private sector union can cause a company to go out of business, an economic threat, whereas a public sector union can cause their manager—the elected politician—to lose their next election, a political threat. This basic difference makes if far more likely that private sector union workers will have a better appreciation of the limits of their power, since if their demands have a sufficiently adverse economic effect on the company they’re negotiating with, that company will go out of business and they will lose their jobs.

Another related manifestation of the authoritarian core ideology among government workers is the simple fact that the government compels people to pay taxes and provides only one option for services, whereas corporations must persuade consumers to voluntarily purchase their products if they want to stay in business. Private-sector union members understand this difference quite well, because they live with the consequences if their company fails in the market.

Environmentalist Restriction vs. Economic DevelopmentWorkers in the private sector benefit from major construction projects and resource development. These projects create new jobs, and they yield broad societal benefits in the form of more competitive choices available for basic resources; energy, water, transportation, and housing.

When more development occurs, this increases supply and lowers prices. Development creates jobs and lowers the cost of living. Private sector union members understand this, but public sector union members have an inherent conflict of interest. This is because public sector workers benefit when roadblocks are placed in the way of development. An extended process of permitting and review, labyrinthine regulations impacting every possible aspect of development, creates jobs in the public sector.

The harder the public sector can make it to build things, the more fees they will collect and the more government jobs they will create. Ironically, the public-sector unions have an identity of interests with the most powerful monopolistic corporations on earth in this regard, because they both benefit from barriers to competitive development. Private sector union members just want to see more jobs and a lower cost of living, which development ensures.

Internationalist vs. NationalistThis area of ideological differences between public and private sector unions is perhaps the least mentioned, and the most subject to overlap and ambiguity. But identifying this difference is crucial to understanding the differing agendas of public- and private-sector unions.

For example, the ideological agenda of the unions controlling public education in the United States are dramatically out of touch with the values of a great many Americans. In states where public education is controlled by powerful teachers unions, classroom materials and textbooks routinely demonize the role of the United States and Western Civilization in current affairs and world history. Their emphasis is to mainstream the marginalized, at the expense of teaching the overwhelmingly positive role played by democracy and capitalism in creating freedom and wealth. Another critical example is how job losses to foreign manufacturers affect members of these respective unions; it has an immediate, deeply negative impact on members of private-sector unions, but is something that has no effect on a public-sector worker.

Members of public-sector unions who consider themselves in favor of free markets and resource development, and harbor pro-American patriotic sentiments, would do well to examine carefully how the leaders of government employee unions have powerful incentives to promote policies in direct opposition to these values. And that is where there might be hope.

The precarious equilibrium between Right and Left in America is maintained not only by virtue of powerful public-sector unions pushing as hard as they can in favor of the Left; public employees themselves constitute a critical swing vote in America’s electorate. Including federal workers, there are nearly 20 million government employees in America, and nearly all of them vote. If you include households with government workers in them, you likely could double that number. These Americans have a tough choice to make: Will they vote for more government, because more government will create more career opportunities for themselves and their loved ones, or will they only ask themselves what political choices will offer the most benefit to all Americans?

Public employees, like all Americans, are awakening to the propaganda that passes as mainstream journalism. Despite rampant suppression of the truth, they can see what has happened to Europe thanks to mass immigration. Despite endless rhetoric coming from the press and public institutions, they realize that campus radicalism and identity politics are a nihilistic dead end. Despite nightly “news” that spends more time on celebrity gossip than global events, they can see the where socialism leads in the devastated nation of Venezuela. They’re even realizing that climate change activism is a cover for globalist rationing and wealth redistribution. They see the hypocrisy.

Public-sector unions are the brokers and enablers of corporate power. As politicians come and go, and business interests rise and fall, they are the continuity, decade after decade. In every city and state where they’ve been allowed, they are the deep state. They are globalist instead of nationalist, authoritarian instead of pluralistic, they favor rationing and regulation over competitive development. They want to make everything harder, scarcer, more expensive. They prefer cultural disintegration and chaos to unity because it empowers them when things get bad. In a just world, public-sector unions would be outlawed. Until then, their agenda and their impact must be exposed for all to see.

This article originally appeared on the website American Greatness.

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Estimated Impact of Janus on California’s Public Sector Unions So Far: $50M/year

On June 27, 2018, the U.S. Supreme Court ruled in the case Janus vs AFSCME. An immediate consequence of this ruling was that public sector unions could no longer collect so-called “agency fees” from workers in their bargaining units who had opted out of full union membership.

The other main consequence of the Janus ruling was that those workers who were full dues paying members of public sector unions would have the right to terminate their memberships. In anticipation of a result unfavorable to them, which Janus certainly was, public sector unions have used their influence with lawmakers to pass numerous pieces of legislation designed to make it harder for union members to quit. As a result, the full impact of union members terminating their membership will not be felt immediately.

With nearly a year passed since the Janus case was decided, however, it is possible to begin to quantify the impact so far on union membership and on union revenues. It’s not at all an easy task. The mandatory disclosure requirements for public sector unions are minimal. Public corporations and private sector unions are both required to disclose much more information about their finances and operations than are public sector unions.

Nonetheless, over the past several months, the California Policy Center has filed numerous public information requests with public agencies in California, asking their payroll departments to disclose how many of employees had union membership dues and fees deducted, and how much those deductions amounted to. While much more information should be forthcoming as additional bureaucracies slowly respond, we now have data from four relatively large agencies – San Diego County, Orange Unified School District, Santa Ana Unified School District, and Los Angeles Unified School District.

Impact on Select California Agencies

The table below shows, at a summary level, what we’ve learned from these four agencies.

Before speculating on how this may translate into a statewide impact by extrapolating from these numbers, a few qualifying remarks are necessary. The columns headed by “# payers” include agency fee payers and full members. From the underlying details, some interesting facts emerged.

In the case of LAUSD, by far the largest agency, four bargaining units were summarized – the UTLA teachers union, the “Associated Administrators of Los Angeles,” the SEIU Local 99, and the CSEA bargaining unit. In all cases, the monthly payroll data used for “before Janus” figures were from January 2018. In most cases, the “after Janus” data was from November 2018 (in the case of CSEA, October 2018 was used). What the detailed data showed for all four unions was that agency fee payers and agency fee revenue ended in July 2018. The actual full membership numbers increased, in general, between January 2018 and November 2018, but not enough to make up for the agency fee payers who were lost. That is, these unions were not generally successful in converting their agency fee payers into full union members.

This same pattern was repeated when reviewing other agencies, although in most cases the only data provided was “total payers” which made it impossible to tell how many agency fee payers were lost in July 2018. It’s important cover this nuance, because it explains why the total drop in dues revenue, 6 percent, is only about one-third as great as the total drop in the number of payers, 17 percent. Many of those payers were not full members, paying full dues, but instead were agency fee payers, paying reduced amounts. One further complicating variable worth mentioning is the fact that some of these agencies were unable to differentiate between dues, agency fees, or payments to the union for other benefits such as supplemental health insurance.

Estimated Statewide Impact

In any case, if the experience of these four agencies is representative of what has happened in the rest of California’s unionized public agencies, it is possible to estimate the statewide impact so far of the Janus ruling.

California’s public sector unions collect and spend an estimated $800 million per year. If that amount has already dropped by 6.4 percent, than total union revenue has been reduced by around $50 million.

It is difficult to rely on this estimate. Did all of the unions have relatively similar percentages of agency fee payers? Did all of them convert a similar, and fairly low, percentage of their agency fee payers into full members? Are agency fees, as a percent of full dues, the same percentage in the rest of California’s bargaining units as they were inferred to be in these cases? For that matter, it’s not even that easy to estimate the total dues revenue of California’s public sector unions. Our current estimate of $800 million per year, released last summer, required revision after the California Policy Center received feedback from some of the public sector unions included in the estimate. It would be nice, of course, if California’s public sector unions would simply disclose their membership numbers and dues revenue. And if wishes were horses, beggars would ride.

In almost any other context, reducing by $50 million the annual revenue of a network of political players, especially at the state level, would be a catastrophe for the organizations involved. But this is California, and these are public sector unions. Losing most of their agency fee payers clearly had a permanent and significant impact on union revenues, but for them, and only them, it might be most accurately described as a one-time loss of manageable proportions. The bigger impact that the Janus ruling might have regards what is going to happen to their rates of full membership. It is now possible for public sector union members to quit their unions, but will they? And if they want to, will the unions be forced to make that an easier process?

Some of the tactics the unions have adopted to make the process of quitting more difficult are being challenged in court. These cases would include Uradnik vs IFO, which would take away a public sector union’s right to exclusive representation, or Few vs UTLA, which would nullify many steps the unions have taken to thwart the Janus ruling. How those cases play out, and whether or not public sector unions can remain accountable enough to their members to keep them in voluntarily, remains to be seen.

This article originally appeared on the website of the California Policy Center.

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Can Public Sector Union Power Ever Be Stopped?

Imagine you’re hoping to support a candidate for local office who will enact reforms that will improve your city, maybe even save it. Someone who will fight tirelessly to eliminate work rules that force agencies to hire more people than are actually necessary. Someone who will insist that incompetent public employees are fired. Someone who will finally do something about compensation and benefit packages that are threatening to bankrupt the city.

What do you say to them, when their response to your suggested reforms is this: “That’s all great, and I’d like to do it all, but who’s going to give me the million dollars for my campaign that I’m not going to get from the public employee unions if I actually try to do any of it?”

That is the sort of conversation that takes place, or would take place if anyone bothered to ask, multiplied by thousands, every election cycle in California.

Public employee unions run California. They exercise nearly absolute power in the state legislature, and in nearly every city, county, school district and special district. Can public sector union power ever be stopped?

Earlier this year, a California Public Policy Center analysis estimated that for 2016, total membership in California’s public sector unions was 1.15 million, and total revenue was $812 million. This equates to a stupefying $1.6 billion that these unions collect and spend every election cycle.

 

California’s Public Sector Unions (including local affiliates)
Estimated Total Membership and Revenues

While the figure of $1.6 billion per election cycle is a credible estimate, attempts to come up with precise information on California’s public sector union dues is nearly impossible. In California there are many hundreds, if not thousands, of individual local public sector union affiliates. All of them file separate 990 forms, often including financial transfers between entities that have to be offset in any thorough analysis.

Determining how much of California’s public sector union revenue is spent on politics is also a nearly impossible task, despite several online “transparency” portals, including OpenSecretsFollowTheMoneyVoteSmart, and the California Secretary of State’s Campaign Finance “Power Search.” These portals are primarily focused on national races, and in some cases, statewide races, but none of them descend to the thousands of California’s local races, where hundreds of millions of dollars are spent every election.

Moreover, the portals can only display the information they’re given. California’s government unions, like most sophisticated political players, mask their total spending through multiple committees and transfers.

An excellent analysis of how much of teachers union dues end up being spent on political campaigns was written in 2015 by RiShawn Biddle, editor and publisher of Dropout Nation – a leading commentary website on education reform. He writes: “The pro bono consultants who went through the unions’ published national, state, and local tax returns estimated based on their research, interviews, and sampling that roughly one third of the unions’ efforts went toward political advocacy.”

One-third. In California, that is equal to approximately $540 million per election cycle. That is, California’s public sector unions likely spend over a half-billion per election cycle. And this spending does not include other “non-political” spending. For example, not reportable as political spending can include massive public education campaigns that are designed to influence voters but aren’t engaging in explicit advocacy.

Also not considered political spending, but having immense political impact, is litigation. There are countless examples of how government union power is exercised in California’s courts. Pension reforms in San Jose and San Diego, approved by voters, were eviscerated through relentless court challenges. Statewide pension reform pushed by Gov. Brown and partially realized in the PEPRA legislation of 2012 was undermined, and continues to be undermined, beneath an ongoing avalanche of lawsuits. Charter schools are the targets of continuous litigation designed to wear them out. You can do this, when you have hundreds of millions of dollars pouring in every quarter, year after year.

California’s political landscape over the past 20-30 years has been defined by public sector unions. While the recent Janus v AFSCME decision by the U.S. Supreme Court has taken away the ability of government unions to compel payment of fees, the unions are resorting to clever contractual gyrations to make it extremely difficult in practice for anyone to stop paying. That too, will have to sort itself out in court, where union money guarantees tenacious defense and endless appeals.

Even if public employees can easily withdraw from paying government unions, in many cases, why would they? These unions have made California’s public employees some of the highest paid public servants on earth. A California Policy Center study in 2017 concluded “The composite average total compensation (pay and benefits) for a full-time city, county or state worker in California during 2015 was $121,843; for the average full-time private sector worker in California, including benefits, it was 62,475, which is 51% of what the public sector worker earned.” As a result, it is no coincidence that California’s state and local governments confront over $1.0 trillion in debt and unfunded pension liabilities.

The political and financial power of public sector unions has transformed California politics. Their influence is felt everywhere; education, environmental policy, the business climate, important cultural issues. In every area, their primary agenda is to grow their membership and influence. The effect of this agenda is pernicious. If schools fail, spend more public money on schools. If crime increases, hire more police and build more prisons. Wherever society fails, grow unionized government.

Perhaps the next major U.S. Supreme Court case concerning government unions will abolish them due to this inherent conflict between their agenda and the public interest. Perhaps someday they will be outlawed entirely. That would be a happy, happy Thanksgiving indeed.

This article originally appeared on the website of the California Policy Center.

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Imminent Janus Court Ruling May Severely Impact Government Unions

The U.S. Supreme Court is about to rule on Janus vs AFSCME, a case that challenges the ability of public sector unions to force government workers to pay union dues. Depending on the scope of the ruling, this case could dramatically affect the political power of big labor in the United States.

The case hinges on the assertion by plaintiff Mark Janus, a public employee in Illinois, that everything a public sector does is inherently political. As a result, Janus argues, even the so-called “agency fees” the union charges – ostensibly to fund nonpolitical activities such as contract negotiations – are a violation of his right to free speech. He’s got a strong case, because nearly everything public sector unions negotiate have a direct impact on public policy.

When a public sector union negotiates for increased pension benefits, for example, every other budget item is affected. In states like California and Illinois, costs for public employee pensions are exceeding 10% of total tax revenuess in some cities and counties, crowding out other public services with no end in sight. And everywhere public sector unions are active, their impact on budgets, along with their negotiated work rules, significantly alter how our elected officials set policy priorities and how they manage our government agencies.

HIGH STAKES

The stakes in the Janus case are epic. Nearly half of all unionized workers in the United States are government workers. Public sector unions collect and spend nearly $6.0 billion per year in the United States. About a third of that – a staggering sum of money – is actually spent on political campaigns and lobbying, while nearly all of the rest funds “non-political” activity that includes get out the vote efforts, public education, and advocacy that stops just short of being explicitly political in nature, yet is blatantly political in its intent. Nearly all of public sector union money is contributed to Democrats, much of it in countless local elections where spending is not tracked.

Public sector union power is concentrated in large urban states such as California where over $1.0 billion per year is collected by these unions, and the result is clear. They have candidates active, and winning, in every political race from the top of the ticket all the way down to local agencies. Whenever necessary, and without blinking, they will spend millions on races as small as a school board seat. In 2005, when California governor Schwarzenegger put four citizens initiatives onto the state ballot that threatened public sector union power, they spent over $100 million in their successful campaign to defeat these propositions.

GOVERNMENT UNIONS ARE DIFFERENT FROM PRIVATE UNIONS

The differences between public sector unions and private sector unions are profound. A public sector union doesn’t have to exist in a competitive commercial environment, where if their demands are too extravagant they will put the company out of business. To get more money, they just demand higher taxes. And unlike private sector unions, public sector unions elect their own bosses, spending money on political campaigns to elect the officials who will then be tasked with managing them. Moreover, millions of zealous public sector union members populate the machinery of government, willing and able to make life a bit more difficult for any other interest group that may challenge their power.

Spokespersons for public sector unions, typically working for the finest PR firms money can buy, frequently attempt to convince voters that they are protecting ordinary “working families” from greedy business interests. But despite being devastatingly persuasive, this is a fabrication. Public sector unions only look out for government workers, which in the states controlled by government unions will often make twice as much in pay and benefits as private sector workers doing similar jobs – yet those private sector workers must pay the taxes to support these overmarket pay and benefits. As for business interests, the bigger a company is, the less likely they are to challenge these unions.

Big corporations not only don’t want to be targeted by public sector unions with retaliatory legislation that could hurt their bottom line. Many of them actually prefer doing business with these unions in charge of state and local governments. They can bid on bloated government public works projects. They can underwrite municipal bonds of dubious necessity and collect lucrative fees. They can help manage the hundreds of billions sitting in public sector pension funds. And they can benefit when excessive government regulations create barriers to entry that are too severe for smaller, potentially disruptive competitors to withstand.

There is a fundamental conflict between the natural agenda of government unions and the public interest. Because government unions prosper when government expands, regardless of the cost or benefit of new government programs. Even worse, when government programs fail, or when government policies harm the public interest – such as encouraging mass migration of destitute, marginally assimilable immigrants – the role of government expands to address the crisis. Whenever this happens, more people become members of government unions, increasing their wealth and power.

HOW THE UNIONS INTEND TO THWART THE JANUS RULING

If the Janus ruling makes it possible for public employees to refuse to pay union dues, these public employees will themselves share the moral conflict inherent in public sector unionism, pitting their own interests against the broader public interest. One may hope the majority of public employees will welcome working in a meritocracy, where their talent and skill and hard work will provide them with opportunities for raises and promotions. But those government employees who support the left wing political agenda of their union, or who prefer to fall back on work rules that give them job security and overmarket pay based on seniority, probably will remain members.

But even if the Janus ruling gives public employees the right to get out of their union, will they be able to? Across the U.S., union controlled legislatures are doing their utmost to stop them from leaving. In California, several laws have been passed in the last few months to mitigate the effects of Janus. Two new laws will make it difficult, if not impossible, for employers to discuss the pros and cons of unionization with employees. Two more will preclude local governments from unilaterally honoring employee requests to stop paying union dues. Another has modified the public records act so that only unions can gain access to employee information, preventing 3rd parties from advocating against unionization. And across the country, labor contracts are being rewritten to make it a bureaucratic obstacle course to opt-out of union membership. Some of these contracts even require employees to quit every year, by automatically reinstating their membership (and dues withholding) annually.

When unions of government workers control a state legislature, and they do in the populous blue states of California and Illinois and elsewhere, they can do almost anything they want.

To say that government unions are one of the root causes of America’s deepest challenges is not an overstatement. They are one of the biggest funders of left-wing politicians and activists, enabling the left to a degree far out of proportion to its actual grassroots support among Americans. They distort the political process to further their own interests. They intimidate and coopt business interests, especially in the financial sector. And they benefit whenever and wherever society fails, and government expands its power and reach in response.

Public sector unions should be illegal. The Janus vs AFSCME ruling will not go that far. But it is a gigantic step in the right direction.

This article originally appeared on the website American Greatness.

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U.S. Senate to Force Unionization of Police?

Within the next few days the U.S. Senate may consider Senate Bill 3194, the “Public Safety Employer-Employee Cooperation Act,” that will require states to grant collective bargaining rights for all public safety workers, including police, firefighters and emergency medical workers.

Residents of California have had a front row seat to witness the consequences of allowing unrestricted collective bargaining by public employees. It is increasingly arguable that the root cause of many of California’s most serious problems – the insolvency of the State and most local governments, and the mediocre public school system, to name two big ones – are because of the influence of public sector unions. And public sector union control over California’s State government, which most insiders will acknowledge is “absolute,” is matched by union control over California’s county and city governments. Now we’re going to export California’s problems with public sector unions to the rest of the United States?

A report written by Kris Maher for the June 17th, 2010 Wall Street Journal entitled “Bill Gives Public Workers Clout,” quotes the Executive Director of the 325,000 member National Fraternal Order of Police, Jim Pasco, who said “unions wouldn’t be able to negotiate wages and benefits that governments couldn’t afford.” It’s interesting to wonder how Pasco can justify this statement, because if history is any indication, the opposite is going to happen.

As documented in “The Price of Public Safety,” in California, it is already common to see public safety workers earn, on average, over $200K per year in total compensation. Much of this compensation has to be used to meet current year funding requirements for their future pensions, because these pension funds today are almost universally insolvent. California’s local government entities are cutting virtually all other government services, including road maintenance, libraries, and public health programs, in order to free up enough money to pay compensation and benefits for their public safety workers.

The fiscal crisis facing public sector entities isn’t merely because of unsustainable compensation and benefits being paid to public safety workers, however, it only begins there. Once the other public sector employees see the political clout and the financial compensation the police and firefighters are acquiring, they too will unionize, even if they haven’t already. At this point you are set to experience California’s plight – where nearly every government employee is overpaid, and consequently nearly every government institution in California is facing possible bankruptcy.

Without a strong set of regulatory checks, allowing public sector workers to unionize creates an unfair political environment, where public employee unions collect mandatory dues – paid for by taxpayers – to amass literally hundreds of millions of dollars to use for political activity. Public employee unions routinely outspend fiscal conservative reformers by ratios of 5-to-1, or even 10-to-1, or more, essentially using taxpayer’s money to advance their agenda, which is bigger and bigger government to create more union jobs, and higher and higher rates of compensation for unionized government employees. Unionized government results in government employees, through their unions, purchasing our elections and hence our elected officials, who then decide on policy matters affecting the compensation and benefits paid to government employees. For this reason, and for the reasons stated below, national legislation should aim at reforming public sector unions, not expanding them.

Why unionization of government workers is a threat to the solvency of America’s Federal, State and local governments, as well as a corrupting influence on the democratic process:

  • Civil service protections already available to government employees make union membership redundant.
  • Government employee unions collect membership dues, funded by taxpayers, and use it for political activity without the consent of the taxpayers and often without the consent of the individual government workers.
  • The automatic transfer of taxpayer funds – via membership dues – into union coffers gives public sector unions an unfair financial advantage in political campaigns.
  • Public sector unions have used their ability to buy elections and control politicians to negotiate financially unsustainable, over-market rates of compensation for public employees.
  • The effectiveness of public agencies has been compromised by work-rules negotiated by unions that prevent, for example, efficient allocation of worker hours or ability to terminate incompetent employees.
  • Private sector unions must, ultimately, negotiate in good faith with their companies, or they will destroy the competitiveness of the company. Public sector unions have no such constraint – and the results are already clear – unprecedented government deficits and debt.

Most everyone respects and appreciates the services performed by public employees, especially those working in public safety. Calling for reform of public sector unions is not personal, it a matter of restoring fiscal sustainability and the integrity of our democratic institutions. Moreover, concern over the unique dangers public sector unions present is not to take issue with unions in the private sector, which at least operate in a somewhat self-regulating environment. Finally, concern over the excessive power of public sector unions does not necessarily equate to an excessively libertarian ideology – many of us would like to see more government investment in our economy. But currently much of our federal deficit spending is being wasted to pay grossly over-market wages to government employees instead of being used for strategic investments that will yield long-term returns to society, such as scientific research, upgraded infrastructure, and military security.

Whether or not unions should be allowed to operate at all in the public sector is debatable. But at the least, if unions are going to be permitted to organize public employees, there should be curbs on their ability to (1) compel any public employee to join a union against their wishes, and (2) compel any public employee to allow any portion of their union dues to be used for political activity against their wishes. Unless checks of this sort, at the least, are part of the package, Senate Bill 3194 is a very bad idea.

No Profits, No Pensions

California Gubernatorial candidate Jerry Brown knows he’s in a fight. His presumptive Republican opponent, Meg Whitman, not only is doing a good job presenting herself as a socially moderate, fiscally conservative candidate, but she has abundant personal wealth she can tap in order to finance her campaign. So Jerry Brown has to turn to the only reliable source of campaign cash out there, the public employee unions.

In Joel Fox’s report of March 22nd entitled “Brown Embraces the Public Unions,” Fox quotes Brown as saying “California’s fiscal problems are not the unions’ fault but that of Wall Street and corporations.” Get ready for a campaign season filled with more bashing of corporations. And here are some reasons why this rhetoric is absurd, nihilistic, corrosive, deceptive, utterly bankrupt, and at least to-date, tragically effective:

Public sector unions are by far the most powerful source of campaign cash in California. They can pretty much spend as much as they want to make sure their candidates get elected, and their opponents are defeated. Without these unions, Jerry Brown wouldn’t have a chance against Meg Whitman. But is Brown only singing the union song in order to get their financial support? After all, in late February 2010, in a closed meeting with a group of California business leaders, Brown admitted the single greatest mistake he made as Governor back in the 1970’s was his decision to sign legislation allowing public sector workers to unionize.

Public sector unions have successfully convinced Californians that Wall Street and corporations are basically to blame for all the problems in our society – from deficits to poverty, from bad public policies to social injustice. But public sector unions are in bed with Wall Street. In the United States, there is no source of new investment capital bigger than public employee pension funds – most of it flowing through Wall Street brokerages. The public sector unions, through their pension funds and through the state and municipal governments – which they control – worked with Wall Street and enabled Wall Street. It was Wall Street who packaged the investments that public pension funds purchased – and it was Wall Street and the public sector unions who, more than anyone, wanted to believe they could earn 8.0% annual returns forever.

That’s not all. In 2006, California’s legislature, controlled by public employees, enacted AB32, California’s “Global Warming Act.” Already, agencies and utilities throughout California are tacking “global warming mitigation” fees into their billings. And in less than two years, when AB32 takes full effect and California starts auctioning tradeable CO2 emission allowances, it is Wall Street firms who will broker these CO2 allowances, and it is Wall Street who will package all the CO2 “offset” prospectuses. Read the “scoping plan” from CARB, which lays out how AB32 will be implemented. You will learn how CO2 “offset projects” – which will receive the proceeds of the CO2 emission allowance auctions – will earn reimbursements by how much they reduce CO2 emissions. For example, by mandating even more draconian high-density than we already endure here in California, municipalities will be able to calculate the emissions they have saved relative to “sprawl,” and collect annual reimbursements. Pet projects that create jobs at taxpayers expense for union workers, such as light rail, will go in regardless of practicality, and also receive carbon offset funds calculated on the basis of their potential to reduce CO2 emissions. California’s global warming act, which will do nothing to address alleged global warming, is a scheme, hatched by public sector bureaucrats to transfer more money from taxpayers into the government. And Wall Street will stage-manage the entire process – making billions in fees.

When Jerry Brown, on behalf of public sector unions, demonizes Wall Street, he’s being a blatant hypocrite, but at least he has a point. In the case of industrial corporations who want to employ people and build actual products, however, Brown and the public sector unions have no point. According to Brown and the unions, if only corporations would behave themselves and pay their “fair share,” all of our problems would disappear. Where is the logical end-point of this nonsense? The last politician to tell the truth about taxes and corporations probably was Ronald Reagan, who correctly pointed out “corporations don’t pay taxes, because they pass the taxes through to the consumer as a cost – ultimately it is individuals who pay taxes.” The public sector union’s answer to this truth, observed by Reagan and confirmed by history, is for government to simply reduce corporate “profits.” If the corporations were forced to make less in profit, supposedly they could afford to pay higher taxes AND charge a fair price to consumers for their products. But profits are the life-blood of economic growth and wealth creation. Without profits, there is no reinvestment in equipment and upgrades, no research and new product development, no new job creation, no dividends to shareholders, and no stock appreciation which provides the return to public employee pension funds. No profits, no pensions. And in any event, corporations in California are beat down, intimidated by public sector unions and environmentalist attorneys, reeling from the effects of recession and the impact of excessive, punitive regulations. California’s business community has been practicing appeasement with the public sector unions and environmentalist attorneys for years – they cower like Théoden, King of Rohan, wasting away, corrupted by fear, waiting for Gandalf and Aragorn to awaken him before all is lost. But we live in California, not Middle Earth.

What public sector unions ought to know, and cannot admit, is that tax revenues they collect and allocate, especially through public pension fund investments, are the engine that fuels Wall Street, and they are as responsible as anyone else in this economy for the excesses and abuse of the financial sector in America. What they also should know, as they watch their pension funds crumble, is the fiscal policies they have forced onto compliant politicians are unsustainable and are cannibalizing the wealth of the country. To distract voters from this financial fact: that California’s public sector bureaucrats, on average, now make 50% more in base pay, 100% more in current benefits, and 200% more in retirement security – compared to the taxpayers who now serve them and pay for this hideous inequity – public sector unions and the candidates they control must preach the politics of resentment and envy, hatred of wealth and environmental panic, corporate demonizing and phony Wall Street bashing. They must brainwash our children in their union-dominated public schools, and bamboozle our electorate through their massive campaign advertising, so they can continue to feed for a few more years on the ailing carcass of what was once the greatest free-market economy in the history of the world.

For more on public sector unions and government solvency in California, read:

The Razor’s Edge – Inflation vs. Deflation, March 15th , 2010

Pension Rhetoric vs. Pension Reality, February 24th, 2010

California’s Union Ballot Initiatives, February 18th, 2010

Sustainable Pension Fund Returns, February 2nd, 2010

California’s Personnel Costs, January 24th, 2010

Maintaining Pensions Solvency, January 9th, 2010

Real Rates of Return, June 26th, 2009

Stopping Taxpayer Funded Unions

When fiscal conservatives run for office, or fiscally conservative initiatives are put onto the ballot, the candidates and proponents have to go out and ask for money to finance their campaigns. But in the case of public sector unions, who overwhelmingly support fiscally liberal, big government programs, and consistently oppose attempts to shrink the size of government, this is not the case. In California, for example, every year these unions automatically collect literally hundreds of millions in dues from unionized state and city workers, which they can use to engage in partisan political activity. In California, ever since 1977, when legislation was enacted to permit collective bargaining by public sector employees, unions have become increasingly involved in influencing public issues and policy. It has now reached the point where public sector unions exercise nearly absolute control over California’s state government, and most of California’s local government entities.

One would think workers in the public sector would object to unions who purport to represent them using their money to pursue a big government agenda that has now put public entities into such a financial crisis that they face furloughs and layoffs. One would think government workers would question why their taxes and fees are automatically and involuntarily siphoned into the coffers of union leaders who use the money to control elections and set the agenda for government. And this is particularly true when these unions financially support – using their money – a liberal agenda that not all public employees necessarily support as individual voters.

Despite the fact that California’s electorate splits almost exactly three ways, with about 35% usually voting Democrat, 33% claiming they are independents, and 29% identifying themselves as Republican, public sector unions overwhelmingly pursue a big government agenda. In practice, this means public sector unions have backed Democratic candidates to the point where California’s legislature is on the verge of having a new tax-enabling 2/3rds Democratic majority – and the political survival of these big-government Democrats depends on receiving union money – taxpayer’s money – for their campaigns. Do you think you are taxed enough already? If so, you are of an opinion contrary to the public sector unions, who are using your taxes to advance a political agenda that requires even higher taxes, and who relentlessly and successfully back policies to further expand government.

The result of public sector unions taking control of California’s government are predictable – removed from the necessity to please customers and sell products and make profits, necessities that compel unions in the private sector to exercise restraint in their demands on management – public sector unions have pursued an agenda of government expansion that has now left every public entity in California teetering on the brink of bankruptcy. Ordinary taxpaying workers in the private sector have been left behind in this extravagant joy ride, as the costs to pay for needlessly expanded government programs and the costs to business to comply with over-reaching regulations have increased the cost of living at the same time as they have reduced the ability of private sector business to provide workers good jobs and regular raises.

Private sector workers in California have been slow to awaken to the financial disaster wrought by out of control unions, as has the press, because they were bamboozled and betrayed by politicians whose political survival depends on campaign funds supplied by public sector unions. The financial clout of public sector unions is unparalleled, with millions of members who are each required to pay several hundred dollars per year in union dues, these unions can make or break any politician they want in the state of California. During Schwarzenegger’s unsuccessful “year of reform,” in the fall of 2005, public sector unions spent over $50 million to defeat just one of Schwarzenegger’s reform initiatives, the one that would have required public sector unions to obtain employee consent before using their dues to conduct political activity.

In spite of the fact that public sector unions can usually outspend their opponents by margins of ten to one or more, however, recent polls indicate the level of understanding of the arrogance and overreach of public sector unions is much higher among voters today compared to 2005. Public employees as well realize the unfairness of seeing their dues diverted to agendas that clearly serve the agenda of the union leadership, instead of the broader interests of society, or their own values. A perfect example is the antics of California’s teachers union, who have imposed crippling constraints on the ability of administrators to reward excellent teachers and dismiss incompetent ones, and have consistently opposed efforts to establish charter schools despite the fact they deliver outstanding educational results. And what has happened to California’s public schools has happened throughout California’s government bureaucracies, thanks to public sector unions.

In November 2010 there will be several reform initiatives on California’s ballot, and one of them aims to begin to rein in the influence of public employee unions. The Citizen Power Initiative will limit the ability of public sector unions to collect a portion of worker’s tax payments, through mandatory union dues assessed on public employees, to pursue their big government political agenda. If this initiative qualifies for the November ballot, expect unions to spend whatever it takes to defeat its passage. But this time around, with workers barely able to pay the many taxes and fees they already suffer, it will be a harder for the unions to use their money to confuse the issues, and derail genuine reform at last.

The initiative has already been cleared for circulation by the California Secretary of State.

Here is the title and summary, which provides a pretty good description of what this initiative will accomplish, if passed:

1403. (09-0054)

Makes Illegal the Use of Public Employee Wage Deductions for Political Activities. Initiative Constitutional Amendment.

Summary Date: 12/04/09 | Circulation Deadline: 05/03/10 | Signatures Required: 694,354

Proponents: Mark W. Bucher, Dawn M. Wildman, Allan R. Mansoor, Lawrence D. Sand, and Mark J. Meckler (714) 573-2201

Amends the California Constitution to make it illegal to deduct from wages or earnings of a public employee any amount that will be used for political activities as defined. Prohibits any membership organization that receives public employee wage deductions from using those funds for any political activities, but does not apply to deductions for charitable organizations, health, life or disability insurance, or other purposes directly benefitting the public employee. Authorizes the Legislature and Fair Political Practices Commission to adopt related laws and regulations. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Probably minor state and local government implementation costs, potentially offset in part by revenues from fines and/or fees. (09-0054.)

You can also read the title and summary (scroll down to #1403) here:

The full text can be found here:

The signature petition is here:

A one-page fact sheet on this initiative is here:

The website for the campaign promoting this initiative is here:

Public vs. Private Sector Unions

Any ideology with scores of millions of willing adherents cannot be completely without merit. For any movement numbering millions of people to flourish, at some level, their underlying ideology must resonate with mostly good people as well as with the inevitable corrupt contingent. Unions, and their ideologies, are examples of good ideas – as well as whatever bad one might ascribe to the influence of unions. And any discussion of unions in America today must assess the ideological schisms between public sector and private sector unions.

Unions for private sector companies grow when the company itself grows. If the company is not healthy, they are not healthy. When companies declare bankruptcy in the private sector, the unions and the jobs go away along with the company. Unions in the private sector envision jobs that build wealth – freeways, levees, aquaducts, new underground telecom/utility conduit upgrades in urban areas, the list is endless and inspiring. They envision jobs in capital intensive, heavy industries, construction, manufacturing, they want Americans to buy American made goods and enjoy a better and better standard of living. Private sector unions are somewhat more likely to recognize that their imperative – more union jobs – is better furthered through building infrastructure and durable manufactured goods, better furthered through competition between private companies in the free market, better furthered with less government. But the conditions that favor more jobs in the private sector conflict with the incentives that create more jobs in the public sector.

Unions represent many public sector organizations that provide absolutely essential services that are best left to government – public safety and military operations in particular. Unions in the public sector, however, also represent organizations whose numbers increase when social problems increase. Hence counter-productive redistributionist efforts by government intended to reduce, for example, poverty and inequality, because they increase the number of government worker jobs – create an incentive for these efforts to be supported by unions representing government workers – especially if these well-intentioned programs are making the problem worse. One of the most crucial battles within the public sector unions will be between those who want to see problems solved through economic growth, not redistribution, supporting a smaller government that retains the best, brightest, most capable and crucial, highly compensated employees within smaller organizations. They oppose those within public sector unions who prefer to see government power increase regardless of the economic or social cost.

One way to characterize the contrast between public sector unions and private sector unions is to say the public sector unions are internationalist and the private sector unions are nationalist. In-turn, this would suggest many well-intentioned members of public sector unions view Amerca’s national interests as always suspect to charges of being inherently ill-gotten if not criminal, because Americans consume more resources than their proportion of global population might be entitled to on a per-capita basis. These conscientious internationalists conclude America’s wealth must be redistributed to the less fortunate throughout the world. This is altruism run amok, but altruistic nonetheless.

Private sector unions, potentially, have a better understanding of the fact that it is financial sustainability, not resource sustainability, that is at issue with alleged American over-consumption. Put another way, sustainable financial growth is the result of honest hard work and innovation, which can combine in a society for centuries creating economic opportunities and wealth-producing assets, and therefore conveys to the peoples of these societies the right to a proportionately higher standard of living. According to this argument, Americans have earned the right to have a better standard of living than those of other nations. This more nationalistic position held by many private sector unions is another key reason job-creating incentives differ between public sector and private sector unions.

Private sector unions are more likely to oppose efforts to increase immigration – something that is especially harmful when fewer highly-skilled immigrants are allowed into America to work – they are wary of open borders and free trade, opposing NAFTA, for example. Nonetheless, to the extent private sector unions are nationalistic rather than internationalist furthers America’s priorities as a people; to internationalize America and redistribute her wealth to the world would require very big government and millions of new government jobs, but this new regime would diminish if not destroy the quintessential American dream, and the jobs that come every time that dream is realized again by another original American entrepreneur. The truth and reality of this uniquely American dream is the source of America’s economic vitality.

Another way unions in the public sector vs. unions in the private sector contrast regards environmentalism. In the public sector, far more revenue can be collected from the private sector by creating elaborate permit requirements and a civil/criminal legal environment of Byzantine complexity and stupefying expense, than by participating in any actual building. Private sector unions, on the other hand, benefit when something real is built, a bridge, a freeway, an aqueduct, a pipeline, a power plant.

There is a vision of environmentalism that ought to be quite popular with private sector unions, a clean development environmentalism that stands athwart the mainstream environmentalist complex (one that incorporates the entire American oligarchy – big government, big finance, big corporations, and public sector labor) and shouts “Stop the Rationing, Cut the Green Red Tape, Rebuild the Nation.”

There is a natural partnership between clean development environmentalists, and private sector unions, supporting job creating, common sense reforms – no bullet train or light rail until roads and freeways are upgraded and unclogged, no more zoning that favors building high-density clusters of McMansions that destroy semi-rural suburbs within the arbitrary “urban service boundary,” no more water rationing instead of a free water market, no more energy rationing instead of a free energy market, and especially, no CO2 regulations, which have more to do with global governance than climate management. These regressive policies further the goals of the internationalist public sector, as well as the oligarchical recipients of corporate welfare, but they do little for the private American worker, and they stunt American economic growth.

One metaphor to describe America might be said to be as a company – with assets of land and infrastructure and intellectual capital. If America can continue to create abundant wealth, America’s ability to address questions of poverty will increase at the same time as the rate of poverty decreases. Americans may owe trillions upon trillions, but America’s currency will never collapse, or hyper-inflate because America is not just a collection of financial transactions – America is a company, an economic entity of staggering wealth, a merit-based culture with a libertarian, entrepreneurial heart. How unions in the public and private sector recognize and address the consequences of their respective priorities – internationalist vs. nationalist, environmentalist vs. cleantech development, and authoritarian vs. entrepreneurial – given the fact they currently control (from within and without) a significant percentage of America’s city, county and state governments – is arguably the prevailing political question in America today.

Exposing Public Sector Unions

Several years ago a consummate Sacramento insider told me “unions run this town,” and subsequent research and observations have confirmed the truth of this statement. Slowly, very slowly, this reality, and the disastrous fiscal consequences of this reality, are being recognized. Criticizing unions is still something responsible people do with some reservations, after all, in the 19th and through much of the 20th century, unions played a vital role in securing basic worker’s rights. These contributions should not be dismissed. But unions today, especially in the public sector, are a different beast entirely. In our current anti-capitalist political climate, unions are getting far less criticism than they deserve, particularly because in the case of state, city and county governments, the unchecked power of public sector unions are almost the sole reason we have a fiscal crisis. Here are some points to consider:

(1) Compensation to public sector employees is not limited to their wages, but must take into account the value of their increased number of paid days off (AND the “9/80” program which equals another 26 paid holidays per year), as well as the current year funding requirement (less whatever they contribute out of their paychecks which is usually only a fraction of the cost) for their retirement health and pension benefits. This “overhead” can easily double the annual cost for public sector employees, whereas in the private sector, overhead costs of this sort rarely exceed 25%. This overhead must be included when assessing how much public sector employees actually make each year.

(2) The state budget not only includes state employees but also payments to cities and counties. The overall personnel costs as a percentage of the state budget should include any payments that aren’t directly to state worker salaries but also payments to other entities (public sector contractors and other public agencies/governments) that in-turn are used to fund salaries.

(3) The state worker pension funds were NEVER as solvent as they were being represented by their managers. The internet bubble, then the housing bubble, were used as justification to beef up retirement benefits that were already unsustainable to still higher levels (in some cases retroactively!), at the same time as the required annual inflow of payments were actually reduced.

(4) State worker unions don’t have to strike – they control elections. To verify this, simply investigate the amount of money they are spending in statewide, city and county elections to finance campaigns of compliant candidates. California Assemblyman Niello recently told me he met with some fiscal conservatives to evaluate what it would take to successfully pass an initiative that would bring about genuine reform and the minimum campaign funding required was $100 million. As you know, the state worker unions spent a lot more than that in 2005 to crush Schwarzenegger’s initiatives. Why is this legal? Isn’t this the taxpayer’s money? Isn’t there a conflict of interests?

(5) Unions at the state, city and county level don’t just bankrupt public entities by virtue of the bloated salaries and benefits they coerce out of politicians whose survival depends on their campaign funds, they also do so by requiring public sector jobs to be far less efficient than they could be. When negotiating their contracts these unions are able to require higher staffing than necessary and narrowly defined job descriptions in order to create more jobs. Equally significant to these crippling work rules, union contracts also take away the meritocracy – they undermine the incentives for any public employee to take individual initiative. There is staggering additional cost for all this.

(6) One reason most voters are still unaware of the role of unions in bankrupting our government entities is because of the lack of balanced media reporting and commentary on the benefits of capitalism as well as the mounting quantity of credible arguments against global warming alarm. The welfare state creates jobs for government workers by breeding dependence. Global warming fees are the only way to inject significant new taxpayer dollars into government coffers. Media influencers need to take a 2nd look at the virtues of the private sector as well as the fallacies of mainstream environmentalism through the perspective of how government unions benefit financially from liberal politics and environmental alarmism.

(7) Unions were a necessity 100 years ago. But it is obvious that they have created legacy obligations that are totally unsustainable and completely unjustified. It is common for journalists to point the finger of blame at Wall Street, with good reason. It is also easy – and accurate – to blame the politicians who failed to regulate the mortgage lending industry. But why aren’t journalists looking at the collusion between public sector unions, politicians, and Wall Street? Over the past 25 years, one of the reasons the financial sector evolved and attracted the best and brightest entrepreneurs is because the manufacturing sector was taken over by unions. Who wants to work or invest in such an anti-entrepreneurial environment? And then the public sector unions demonized “corporate profits” at the same time as their pension funds took major stakes in these corporations. There is a lot of connectivity here, and very few reporters are trying to expose it. Does anyone really think public sector union bosses don’t get the fact that artificially scarce land, “urban service boundaries” and inflated home prices means more property tax revenue?

(8) Public sector unions provide the farm team for political office. The depth of the field of political candidates coming from the public sector simply dwarfs anything possible from the private sector. In the private sector we have to work all the time. In the public sector they get 2-5x more days off each year with pay, then retire early. And they have more incentive to get involved, because the politicians directly control the salaries they receive. If you look at the candidates for the entry level political offices; school board, water board, firefighters commission, whatever, the candidates and officeholders are nearly all current or retired public sector employees. When I visited the California State Republican convention last February, my unscientific survey indicated nearly ALL of the party activists are government workers. Three public sector unions were the primary sponsors of the event! There wasn’t a corporation in sight. What does that tell you?

Because of the failure of politicians and voters to adequately confront the crucial differences between unions in the public sector vs. unions in the private sector, government workers have taken over our government. The result is a far less efficient government, a government with a self-serving political agenda that skews towards more self-defeating entitlement spending and more environmental alarmism, and a government that has poured all their financial resources into paying themselves far more than the rest of us earn with comparable skills. Crucial investments in infrastructure are deferred under the pretext of environmental concerns, when in reality, that investment money is being diverted to pay grossly overmarket salaries and pensions for unionized public sector workers.

What needs to happen in Sacramento and at every city hall and county seat in California is the salaries and pensions of government workers need to be cut at least 20% (or more) across the board; in the case of pensions these cuts should be as much as 50%. That is the solution, NOT cutting jobs or services. And it would be nice to see a major newspaper support this editorially, and lay the blame where it belongs – on the decades-long failure of voters, journalists, and politicians to recognize and restrict the political power of public sector unions.