Ups and Downs for Unions
Sean Smoot, the executive director of the Police Benevolent & Protective Association of Illinois, at a recent demonstration against budget and staffing cuts for law enforcement.
Bad news: Some polls show that barely half of Americans approve of unions, while an overwhelming majority approve of Right-to-Work laws, according to The Heartland Institute.
While becoming more and more powerful, public sector unions are losing favor with taxpayers, said Daniel DiSalvo, a senior fellow at the conservative Manhattan Institute and author of “Government Against Itself: Public Union Power and Its Consequences,” during a forum hosted by The Illinois Policy Institute in Chicago.
The event’s format was that of a two-way conversational discussion that took place between DiSalvo and Paul Kersey, director of labor policy at the Illinois Policy Institute, about the role of public-sector unions in politics today. Daniel DiSalvo is Assistant Professor of Political Science in the Colin Powell School at The City College of New York-CUNY.
Although Americans have long supported public unions because they associate them with the merits of the working class, recently taxpayers have begun to see reality with polls showing that barely half of Americans approve of unions, while an overwhelming majority approve of Right-to-Work laws.
Emily Rose, Vice President of Development, introduced Paul Kersey and Daniel DiSalvo. Mr. Kersey directed a series of questions to DiSalvo for his response, all of which were relevant to DiSalvo’s book, “Government Against Itself: Public Union Power and its Consequences.”
The book is about a broken system whose financial consequences have reached the point of being unsustainable, an assumption that many economists have called “misleading” and simplistic.” The broken system referenced pertains to unions representing government workers in contrast to those found in the private sphere.
No longer the underdog, public-sector unions since 2009 have totaled more members than the membership in traditional private-sector unions. This imbalance came about when in 1962 President John F. Kennedy signed Executive Order 10988 permitting collective bargaining for federal employees. Around the same time state and city workers, teachers and firemen were starting to unionize.
Public-sector government employment now accounts to 17% of total U.S. employment. Those employed are mostly found in state and local governments, with teacher having the most members, about 41% of the total public membership. The cost of public sector union employees (teachers) eats up two-thirds of the government’s (school district’s) operational budget. Public sector workers actually fight for benefits whose provision will hurt the public.
What is the nature of pubic unions versus private unions?
In public sector unions, pre-existing job protection exists through civil laws that provide protections from arbitrary firing, transfers, and disciplinary actions that private sector workers usually lack. Government can access new revenue through taxation, while private workers are fully exposed to the business cycle.
Public sector unions can vote for the politicians who sit across from them at the bargaining table. This gives politicians (or their delegates) an incentive to give unions concessions instead of bargaining hard, like private-sector unions do.
Public sector unions contribute billions to candidates on every level, almost always to candidates from one party. At one point or other, these are the very candidates who will be “negotiating” contracts with these public sector unions, a definite conflict of interest. In some states public unions have become so powerful, that there is no opposition. They can also exert greater influence on their members that private sector unions, through political lobbying.
In the private sector the argument is over how to divvy up the profits: How much to owners, how much to management, how much to labor, and how much spent to improve products? If labor gets too greedy, that drives up the cost of whatever they’re making until customers start buying less. Profits then decrease, raises decrease or stop altogether, and jobs start going away.
Labor either wises up of the company goes down. The public sector can’t go out of business no matter how much union members manage to squeeze out of it. Union members have no incentive to settle for less, and the costs get passed along to the taxpayer. In many cases management benefits from higher settlements.
Workers in the private sector struggle with stagnant wages, disappearing benefits, and rising retirement ages, while unionized public employees retire in their fifties, many with over $100,000 a year in pension and healthcare benefits.
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