The idea of the redistribution of wealth is an appealing one, especially for people who don’t consider themselves wealthy. Many people believe that economic equality is the only way to truly make people equal. After all, one of history’s most famous urban legends — Robin Hood — took from the rich and gave to the poor.
However, what many people don’t realize is that Robin Hood was actually stealing from the government— an oppressive aristocracy which was taxing its citizens unfairly — and giving back money which was originally the poor’s in the first place.
But does wealth redistribution actually help society? Is it more beneficial to the rich than it is to the poor? Is it a cheap stunt used by politicians to get votes?
In this article, we’ll examine the concept of wealth redistribution, its effect on the United States, and more importantly — how it effects your average taxpayer.
Free Is Really, Really Expensive
These days the only way a politician can get elected is by promising more free stuff than the politician he is running against. But the public doesn’t seem to realize that free stuff isn’t really free.
It would be political suicide for a politician to even suggest that we should cut back in any area of the budget. If you suggest cutting the military budget, the right wing will tell you you’re un-American and there are terrorists under your bed. If you suggest cutting social security, the AARP will mobilize their tsunami of voters against you. And if you suggest cutting Medicare and Medicaid, the entire population will rise up against you screaming, “But health care is the single most important issue of our day!”
The problem is that every issue is the single most important issue of our day.That is why tough choices that need to be made to shore up our economy won’t be made.
To this you must add the fact that the United States of America has essentially become a socialist society living under the delusion that we are still free market capitalists. We forget that WE ARE the government.
The government isn’t some benevolent, separate entity with deep pockets. Whenever a problem arises, the majority always says the same thing — “The government should do something about it.”
They all seem to think that our government should be everybody’s safety net. When major hedge funds overleverage themselves, they think the government should bail them out, and when homeowners over-mortgage their homes, they think the government should save them from foreclosure.
We don’t seem to make the connection that whenever the government “does something about it,” it does so at half the efficiency and twice the cost of the private sector.Then it hands the public the bill through either direct taxation or through inflation taxation (aka the “hidden tax“).
That means, in the end, we all pay.
One of the biggest problems is that we hire (i.e. vote for) the wrong people to decide how our currency is to be spent. I would venture to say 99% of the officials we send to Washington D.C. who are charged with the job of redistributing our wealth, and thus the task of running the economy, know nothing about economics.
And if they do know, they don’t really care because their term is only two, or four, or six years.
President George W. Bush, as captain of our economic ship, decided to correct our course with tax cuts, and then scuttle us on the rocks of reckless spending due mostly to Medicare prescription drug benefits and the war in Iraq. But unlike the captain of the Titanic, he’s not going down with the ship — we are.
The Dangers of Big Government
The biggest problem facing America isn’t the housing crisis, the war on terror, or public education. The biggest problem facing America is really big government. It’s a huge monster that needs continuous feeding.
Before President Roosevelt’s New Deal, the federal government was just 3% of the economy. Today, it’s over 26%. And when you add in state and local governments, plus the cost of regulatory compliance, plus the cost of all the business that provides goods and services that support all the government agencies, it’s more than 50% of the U.S. economy.
The biggest threat the American people have to face in any economic crisis is government coming to the rescue. And with the government so big, and so pervasive, and with everyone expecting government to provide a safety net for every possible contingency — it will continue to grow.
That means it will require more money. Where does it get that money? From you and me. And when it needs more than we are able to give, it creates it out of thin air.
As the famous economist Milton Friedman puts it:
Government has three primary functions. It should provide for military defense of the nation. It should enforce contracts between individuals. It should protect citizens against crimes against themselves or their property. When government — in pursuit of good intentions — tries to rearrange the economy, legislate morality, or help special interests, the costs come in inefficiency, lack of innovation, and loss of freedom. Government should be a referee, not an active player.
People don’t realize what government bailouts of private financial institutions really cost. The savings and loan crisis of the late 1980s cost taxpayers $150 billion. In 1989 the U.S. population was less than 250 million. That means everyone in the U.S. paid more than $600 each ($1,000 in 2007 dollars), either through taxes or inflation, to fix problems stemming from those financial institutions’ stupidity. But that was nothing compared to what looms on our horizon.
The reason the potential for systemic financial failure of our economy exists at all is because the public allowed themselves to be hoodwinked by big government and big banks.It was a process that took a few hundred years to unfold.
The first con job was that we allowed ourselves to be taken in by fractional reserve banking policies, which allows banks to create money out of thin air.
The second con job was allowing fractional reserve commercial banks to be pyramided on top of fractional reserve central banks (like the Federal Reserve).
The third mistake was not rising up against our government and the central banks in 1971 when the Federal Reserve, in collusion with President Nixon, made the U.S. dollar into a purely fiat currency.
The fourth, and probably biggest, mistake is allowing government to continue to create money and spend it unchecked as it continues to grow, and grow, and grow.
The result is simple: inflation, inflation, and more inflation.
What Is Socialism?
Socialism refers to a broad set of economic theories of social organization advocating social or collective ownership and administration of the means of production and distribution of goods, and the creation of an egalitarian society where labor is the main source of wealth.
In essence, in a socialist society, everything is owned by one organization, and all money flows into and out of that organization.
In this sense,Socialism is another word for one great, big, gigantic monopoly — where the government is the body that controls this monopoly.
In theory, this is a great system because it promotes “fairness” in the sense that it eliminates poverty. However it also eliminates incentives to succeed, to innovate, and to work hard. It also creates enormous inefficiency, stagnant to non-existent economic growth, and the creation of an elite ruling class that is rife with corruption.
In economics, a monopoly exists when a specific individual or enterprise has sufficient control over a particular product or service to determine significantly the terms on which other individuals shall have access to it. Monopolies are thus characterized by a lack of economic competition for the good or service that they provide and a lack of viable substitute goods.
When the government nationalizes an industry, it essentially gains a legal monopoly over that industry and eliminates all competition from the marketplace. The reason monopolies are illegal in the private sector is because when one entity has control over an industry, there are no price controls. Competition drives down the cost of goods and services. Without competition, there is nothing to keep the controlling organization from price gouging its customers.
This is especially dangerous when it comes to necessities, like food, water, medicine, etc.
When you allow government to grow and take over industry, you essentially allow the government to control the price of the goods and services in that industry.
Many people believe this is a good thing because government can keep the price of those goods and services low. However, price limits have historically backfired on all governments who have tried them, because the free market always wins out — no matter what you do to try and stop it.
In 301, Roman emperor Diocletian issued an order called the Edict on Prices, which imposed the death penalty on anyone selling goods for more than the government-mandated price. Merchants could no longer sell their wares at a profit, so they closed up shop or moved to lands which allowed them to sell their goods at a free-market price.
When government mandates prices that are artificially low, it causes a transfer of wealth out of the country. To see evidence of this, simply look at the communist nation of Cuba.
Though Cuba is communist,the difference between socialism and communism is that a socialist society is only about economic monopolies, whereas a communist society is about economic and political monopolies.
Since the communist revolution in Cuba in 1959, the country has seen a progressive economic downturn. Without the influx of money from the Soviet Union to bolster its economic, it has seen class equality achieved — everyone in Cuba (except for the ruling class) is poor.
Here is what Socialism has brought to Cuba:
Production is run by the government and the labor force is run by the state.
Capital investment is restricted and requires approval by the government. This ensures a lack of private sector jobs and economic competition.
The Cuban government sets most prices and rations goods to citizens.
Any firm wishing to hire a Cuban must pay the Cuban government, which in turn will pay the company’s employee in Cuban pesos.
Preferential treatment exists for the ruling class of the Communist party, which get luxuries average citizens do not, such as access to transportation, work, housing, university education and better health care.
Starting in the late 1980s the Soviet subsidies for Cuba’s state-run economy started to dry up. Before the collapse of the Soviet Union, Cuba depended on Moscow for sheltered markets for its exports and substantial aid. The Soviets had been paying above-market prices for Cuban sugar, while providing Cuba with petroleum at below-market prices. The removal of these subsidies sent the Cuban economy into a rapid depression known in Cuba as the Special Period.
Since 1959 Cuba has experienced slow growth in its Gross Domestic Product relative to other countries that were in a similar situation in the 1950s, stagnant trade, and amassed a significant debt amounting to some $16.62 billion in convertible currency and $15 to $20 billion dollars with Russia
Cuban citizens themselves have experienced a decrease in their caloric intake and a shortage of housing since 1959.
For some time now, Cuba has been experiencing a housing shortage because of the state’s failure to keep pace with increasing demand.
Food is rationed to Cuban citizens and state salaries are failing to meet personal needs of its citizens under the state rationing system chronically plagued with shortages.
As the variety and amount of rationed goods available declined, Cubans increasingly turned to the black market to obtain basic food, clothing, household, and health amenities.
There have been mass exoduses of Cuban citizens to the United States in an effort to achieve economic prosperity, causing a decline in productivity, innovation, and wealth creation in Cuba — not to mention a shrinking work-force, which contributes to the government’s failure to meet production demand.
And this is just the most recent example of how a government-run monopoly can wreck the economy. Keep in mind, this all started when Castro had his government seize the wealth and property of his country’s rich and wealthy, and took over the utilities and financial institutions.
Why Wealth Redistribution Is Good for the Rich and Bad for the Poor
Although socialism has long claimed to be for the poor, it has probably done more damage, on net balance, to the poor than to the rich. After all, the rich have enough money to leave the country if they think the socialists are going to do them any serious harm.
Some of our own rich here in the United States have already had their money leave the country, to be sheltered from the higher taxes that limousine liberals say we should all pay (to learn more about this, read our article on how the rich hide their wealth). Meanwhile, the mainstream media give them kudos for their selfless advocacy of higher taxes on higher income people, forgetting that these are not taxes on wealth.
Most of the people in the upper income brackets are not rich and do not have wealth sheltered offshore. They are typically working people who have finally reached their peak earning years after many years of far more modest incomes — and now see much of what they have worked for siphoned off by politicians, to the accompaniment of lofty rhetoric.
The rich have learned to adapt socialist policies to their own benefit. For example, a while back the city of Riviera Beach, Florida, was planning to demolish a working class neighborhood under its power of eminent domain, in order to prepare the way for a marina for yachts, luxury condominiums and an upscale shopping district.
What will the city of Riviera Beach get out of all this? More taxes from higher-income people, enabling local politicians to spend more money on programs to attract votes. Meanwhile the rich get rid of lower-income folks without having to pay them the value of their homes and businesses that will be demolished. As in so many other cases, eminent domain is socialism for the rich.
Theoretically, those whose homes and businesses are demolished will get the “just compensation” to which the Constitution says they are entitled.
In reality, just announcing plans to demolish the homes in an area will immediately demolish part of their market value. Even if homeowners are compensated for whatever value remains when their homes are actually demolished — which can be years later — they have still been had.
For businesses, compensating them for the value of their physical assets — which may or may not include ownership of the place where their businesses are located — does nothing to compensate them for the often much larger value of the clientele they have built up over the years but who are now scattered to the winds by neighborhood demolition.
This game doesn’t work the same way in rich neighborhoods. Not only can the rich hire big-bucks lawyers to fight city hall, why would city hall want to get rid of upscale taxpayers, who are often also big donors to political campaigns?
Remember — in socialism, there is no equality. There is the ruling class, and everyone else.As evidenced in other socialist countries, the ruling class (those who control the monopolies) get special perks and privileges others do not.
In a socialist society, the rich, who can afford to lobby politicians, are usually awarded favorable treatment due to their ability to help finance political campaigns. In exchange, they are not only given preferential treatment, but in most cases, more wealth is transferred to them in the form of political power. This leaves the average working man out in the cold, as he now has no way to achieve success thanks to the anti-competition stance of a socialist government as opposed to the open opportunities of a free market.
How Will Obama’s Tax Policies Redistribute Wealth?
Barack Obama has stated numerous times that he is looking to create “fairness” in America’s economy, which is a socialist ideal. He has even stated that he wants to “share the wealth” by taking money from people who earn it in the form of higher taxes, and giving it to people who don’t. (The “rich guy and the waitress” metaphor he likes to repeat.)
You can see him talk about his socialist-leaning beliefs in these videos:
This makes it obvious that Barack Obama does not see taxation as a means to pay for government works, rather he sees taxes as a socialist system of wealth redistribution.
If you apply Obama’s “fairness” policies to schools, you’ll get a better idea of how this works:
Let’s say your child is studying for an important test. He comes home from school and studies hard and diligently for hours. He learns the material, and when he takes his test, he gets an A+ thanks to his hard work.
But then the teacher goes to him and says “You did great, but Billy and Jack didn’t do so well. They both got D’s on the test. In order to make things fair, we’re going to take away two of your grade points and give it to them, so now you all have C’s.”
Your child cries to you about how he worked so hard to earn an A, while Billy and Jack played video games. You complain to the teacher about it not being “fair,” because your child worked for his grade while the other two didn’t. Your complaints fall on deaf ears, since to the school, their definition of fairness means everyone gets the same grade, while your definition of fairness is that you get what you work for.
Now, your child gives up studying and plays video games all day because he can’t see the point in studying hard when everyone gets the same grade due to the school redistributing them.
If it were your child this happened to, chances are you’d raise holy hell to make sure his hard work got rewarded. But when it comes to other people’s money, most wouldn’t fight for the “fairness” of others keeping more of what they worked hard to earn.
Remember — in America, we aren’t pegged into an income class. If a waitress making $4/hour plus tips wanted to, she could start her own restaurant and make more money. Or she could invest in stocks and get money from the market. Or she could learn a skill and get a better job. Just because that waitress works at a minimum wage job, does not mean she does not have opportunity to advance economically.
Barack Obama’s mantra of being “neighborly” is also flawed. Being neighborly implies you have a choice to be kind to someone in your community. If you like your waitress, you are free to choose to give her more of your hard earned money.
But when the government takes your money, you have no say in who that money is given to. While you work hard every day trying to provide for your family, that money you pay in taxes might be given to an alcoholic on welfare who watches TV all day and neglects his kids. You just never know, because you are not in charge of your money at that point.
The most telling effects that Barack Obama’s “share the wealth” philosophy will have on the economy, however, are the effects on states that already practice his tax the rich, give to the poor policies.
Barack Obama’s Wealth Redistribution In Practice
Despite the federal government’s growing economic dominance, individual states still exercise substantial freedom in pursuing their own economic fortune — or misfortune. As a result, the states provide a laboratory for testing various economic policies.
In this election year, the experience of the states gives us some ability to look at the economic policies of the two presidential candidates in action. If a program is not playing in Peoria, it probably won’t work elsewhere. Americans have voted with their feet by moving to states with greater opportunities, but federal adoption of failed state programs would take away our ability to walk away from bad government.
Growth in jobs, income and population are proof that a state is prospering. But figuring out why one state does well while another struggles requires in-depth analysis. In an effort to explain differences in performance, think tanks have generated state-based economic freedom indices modeled on the World Economic Freedom Index published by The Wall Street Journal and the Heritage Foundation.
The Competitiveness Index created by the American Legislative Exchange Council (ALEC) identifies “16 policy variables that have a proven impact on the migration of capital — both investment capital and human capital — into and out of states.” Its analysis shows that “generally speaking, states that spend less, especially on income transfer programs, and states that tax less, particularly on productive activities such as working or investing, experience higher growth rates than states that tax and spend more.”
Ranking states by domestic migration, per-capita income growth and employment growth, ALEC found that from 1996 through 2006, Texas, Florida and Arizona were the three most successful states. Illinois, Ohio and Michigan were the three least successful.
The rewards for success were huge. Texas gained 1.7 million net new jobs, Florida gained 1.4 million and Arizona gained 600,000. While the U.S. average job growth percentage was 9.9%, Texas, Florida and Arizona had job growth of 18.5%, 21.4% and 28.9%, respectively.
Remarkably, a third of all the jobs in the U.S. in the last 10 years were created in these three states. While the population of the three highest-performing states grew twice as fast as the national average, per-capita real income still grew by $6,563 or 21.4% in Texas, Florida and Arizona. That’s a $26,252 increase for a typical family of four.
By comparison, Illinois gained only 122,000 jobs, Ohio lost 62,900 and Michigan lost 318,000. Population growth in Michigan, Ohio and Illinois was only 4.2%, a third the national average, and real income per capita rose by only $3,466, just 58% of the national average. Workers in the three least successful states had to contend with a quarter-million fewer jobs rather than taking their pick of the 3.7 million new jobs that were available in the three fastest-growing states.
In Michigan, the average family of four had to make ends meet without an extra $8,672 had their state matched the real income growth of the three most successful states. Families in Michigan, Ohio and Illinois struggled not because they didn’t work hard enough, long enough or smart enough. They struggled because too many of their elected leaders represented special interests rather than their interests.
What explains this relative performance over the last 10 years? The simple answer is that governance, taxes and regulatory policy matter. The playing field among the states was not flat. Business conditions were better in the successful states than in the lagging ones. Capital and labor gravitated to where the burdens were smaller and the opportunities greater.
It costs state taxpayers far less to succeed than to fail. In the three most successful states, state spending averaged $5,519 per capita. In the three least successful states, state spending averaged $6,484 per capita. Per capita taxes were $7,063 versus $8,342.
There also appears to be a clear difference between union interests and the worker interests. Texas, Florida and Arizona are right-to-work states, while Michigan, Ohio and Illinois are not. Michigan, Ohio and Illinois impose significantly higher minimum wages than Texas, Florida and Arizona. Yet with all the proclaimed benefits of unionism and higher minimum wages, Texas, Florida and Arizona workers saw their real income grow more than twice as fast as workers in Michigan, Ohio and Illinois.
Incredibly, the business climate in Michigan is now so unfavorable that it has overwhelmed the considerable comparative advantage in auto production that Michigan spent a century building up. No one should let Michigan politicians blame their problems solely on the decline of the U.S. auto industry. Yes, Michigan lost 83,000 auto manufacturing jobs during the past decade and a half, but more than 91,000 new auto manufacturing jobs sprung up in Alabama, Tennessee, Kentucky, Georgia, North Carolina, South Carolina, Virginia and Texas.
So what do the state laboratories tell us about the potential success of the economic programs presented by Barack Obama and John McCain?
John McCain will lower taxes. Barack Obama will raise them, especially on small businesses. To understand why, you need to know something about the “infamous” top 1% of income tax filers: In order to avoid high corporate tax rates and the double taxation of dividends, small business owners have increasingly filed as individuals rather than corporations.When Democrats talk about soaking the rich, it isn’t the Rockefellers they’re talking about; it’s the companies where most Americans work. Three out of four individual income tax filers in the top 1% are, in fact, small businesses.
In the name of taxing the rich, Barack Obama would raise the marginal tax rates to over 50% on millions of small businesses that provide 75% of all new jobs in America. Investors and corporations will also pay higher taxes under the Obama program, but, as the Michigan-Ohio-Illinois experience painfully demonstrates, workers ultimately pay for higher taxes in lower wages and fewer jobs.
Barack Obama would spend all the savings from walking out of Iraq to expand the government. John McCain would reserve all the savings from our success in Iraq to shrink the deficit, as part of a credible and internally consistent program to balance the budget by the end of his first term. Barack Obama’s program offers no hope, or even a promise, of ever achieving a balanced budget.
Barack Obama would stimulate the economy by increasing federal spending. John McCain would stimulate the economy by cutting the corporate tax rate. Barack Obama would expand unionism by denying workers the right to a secret ballot on the decision to form a union, and would dramatically increase the minimum wage. Barack Obama would also expand the role of government in the economy, and stop reforms in areas like tort abuse.
The states have already tested the McCain and Obama programs, and the results are clear. We now face a national choice to determine if everything that has failed the families of Michigan, Ohio and Illinois will be imposed on a grander scale across the nation. In an appropriate twist of fate, Michigan and Ohio, the two states that have suffered the most from the policies that Barack Obama proposes, have it within their power not only to reverse their own misfortunes but to spare the nation from a similar fate.
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The majority of Americans are dependent on the federal government for their health care, education, income, or retirement — at the same time the number of taxpayers paying for these benefits is rapidly shrinking. How can any free nation survive when a majority of its citizens, now dependent on government services, no longer have the incentive to restrain the growth of government? As we all know, over the last 50 years, American attitudes have shifted from cherishing self-sufficiency and personal responsibility to craving cradle-to-grave security 'guaranteed' by government. The result is that increasing numbers of Americans are dependent on government for their income, careers, health care, education, and other essentials. Government benefits — once concentrated on 'the needy' — now extend into middle- and upper-middle-class households, even as more and more Americans see their income tax liabilities decrease. Today, the majority of Americans can vote themselves more generous government benefits at little or no cost to themselves. As a result, most have little fiscal incentive to restrain the continued growth of Big Government and the entitlements it dangles before them. - Jim DeMint, The Coming Crisis, May 8, 2001 A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover that they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, which is always followed by a dictatorship. - Justice Litle, Is America’s Economic Recovery on the Whole Based on a Rotten Sham?, Daily Markets, April 20, 2010 If one understands that socialism is not a share-the-wealth programme, but is in reality a method to consolidate and control the wealth, then the seeming paradox of super-rich men promoting socialism becomes no paradox at all. Instead, it becomes logical, even the perfect tool of power-seeking megalomaniacs. Communism or, more accurately, socialism is not a movement of the downtrodden masses, but of the economic elite. - Gary Allen, None Dare Call It Conspiracy, Concord Press, 1971
The movement toward public sector unionism and collective bargaining began in the late 1950's. Its proponents ought to be forgiven for their failure to foresee just how harmful it would be to our nation's governmental institutions. They had no empirical evidence on which to base their ideas. Now, almost forty years later, the politicians who insist on perpetuating the compulsory public sector collective bargaining laws that have given public sector unions disproportionate power in determining the size, cost and quality of public services are less easily forgiven. The record is clear. It is an unmitigated disaster. But, politicians are, after all, politicians and the laws that gave public sector unions so much influence on government decisions have also made them into very powerful political forces throughout the country. Fortunately, there is a new mood sweeping the country and the public is not content to allow politicians to maintain business as usual with special interests. Already, in small ways all across the country, public sector union power is being successfully challenged. But, Rome was neither built nor burnt in a day. There is a long way to go to restore the proper balance between the public interest and the interests of public employees. - David Denholm, Beyond Public Sector Unionism: A Better Way, Public Service Research Foundation, October 1994
The problem we face now is that our “Capitalism” is corrupt and only serves the Elite. Those with the political connections get bailed out of their failure and spread the cost among those who were prudent or worse, those that succeeded. In reality we have a two tiered system in which most of America gets the failure of Capitalism and the Elite get the Socialism of being bailed out on our backs. In essence we privatize profits and socialize loses. This creates a moral hazard where those that are alleviated of the risk of failure, take more and more risk, in search of greater profits. This ultimately leads to a crisis which, is where we are today. - Silver Shield, The Two Coming American Revolutions, Dont-Tread-On.me, March 25, 2011
Time appears to be running out, with dire changes having already begun. Who knows, maybe there is only a year or two remaining of relative freedom of movement before the controllers reveal their deep affinity with the dark side by setting up what seems to be their planned world dictatorship, world government, and world currency. They have learned how to manufacture crises and disasters, such as 9/11, as a means of seizing more power. The signs that they are springing the trap will be the increased bureaucratization of all aspects of life, wartime measures like rationing and transportation checkpoints, centralization of financial institutions, control of populations through un- and under-employment, elimination of freedom of speech on the internet, and continued growth of computerized systems containing personal identifying information. As has happened before, the majority of people will likely be so sick of the rising tide of chaos, which the controllers have helped engineer, that they will willingly trade their autonomy for the shackles of totalitarian order. - Richard C. Cook, The Time of Testing Is Here, richardccook.com, May 24, 2010
The collective bargaining laws have given enormous political power to the public sector unions. No matter what the real intent of these laws, by any objective standard they are not in the public interest. They represent an expression of the selfish self-interest of public sector union organizers and, indirectly, the interest of the politicians who enact them in order to curry favor with the union's political operatives.
The existence of public sector collective bargaining makes public employees "super citizens" and relegates the rest of the public to second class status. Rising public discontent has focused on the public employee, while public employees increasingly take a hostile attitude toward the public. Why is no one pointing out that unions are supposed to be for the people against the corporation, not for the people against the people?
Public sector strikes enjoy a heightened degree of effectiveness not shared by private sector work stoppages. There is little question that strikes against government are intolerable. Therefore, collective bargaining as an institution is inappropriate to government. Strikes destroy democratic government by giving the public sector union -- a very small special interest group -- disproportionate influence and therefore effective control of the public decision making process. Binding arbitration completely removes elected officials from the process.
The whole concept of public servants being able to unionize is abhorrent and should be outlawed. Public service unions and the politicians they "negotiate" with are not on opposite sides of the bargaining table like private sector unions and corporate management. They sit together and share a quid pro quo relationship over the plundering of public funds. The politicians that agree to deals with the unions have nothing to lose because it is other peoples' money they are negotiating with; and the unions' negotiating tools are campaign donations taken from the dues collected from its members whose incomes are paid for by tax dollars. The unions make donations in support or against the politician they are negotiating with. Any sort of relationship like this in the private sector would be considered 100% illegal. FDR was right when he declared public employee unions to be immoral, and Reagan was right when he fired the air traffic controllers. Unions have certainly done a lot for changing working conditions, compensation, and benefits for generations of workers in the private economy, and they have a place there; but when it comes to organizing in the public sector, they are fundamentally immoral and unethical due to the unique relationships that exist between workers, politicians and the taxpaying public. [Bill, February 25, 2011]
Collectivists advocate controlled elections, controlled media, controlled education, the elimination of free speech, disarmament of the population, fiat money, a cartelized health-care system, military imperialism, and global government. Individualists advocate honest elections, a competitive media, an educational system responsive to parents, encouragement of free speech, a well-armed citizenry, sound money, freedom-of-choice in health care, a non-interventionist foreign policy, and national sovereignty. [Freedom Force International]
Between 1958 and 1978 the public sector work force grew by 83% while the private sector work force grew by only 39%. New data from the Bureau of Labor Statistics (BLS) show that a majority of American union members now work for the government. The pattern of unions adding members in government while losing members in the private sector accelerated during the recession. Representing government employees has changed the union movement's priorities: Unions now campaign for higher taxes on Americans to fund more government spending. Congress should resist government employee unions' self-interested calls to raise taxes on workers in the private sector.
One must try really hard to ignore the distinctions between public and private unions. It is those disparities that produce disproportionately rich salaries and benefits for public-sector employees and that burden state budgets. You would think that more politicians and pundits on the left, who have so many creative ideas for spending the taxpayers' money, would recognize that it's their agenda as well as the country's political health that is imperiled by the public employee union racket. [Jennifer Rubin , Public employee unions vs. the rest of us, Washington Post Voices, February 22, 2011]
The public sector, in most instances, is a monopoly. The public sector provides essential services. It is the very nature of government to provide on a monopoly basis those services which everyone needs. Public sector decisions are political decisions no matter how great their economic impact. Government makes decisions every day that have profound economic consequences, but these decisions are based on political, not economic, considerations. In the public sector, decisions that are politically popular but economically ruinous can get you reelected; decisions that are economically sound but politically unpopular are ruinous. The private sector is competitive; there are alternative sources of supply for the goods and services produced. The private sector provides nonessential services. Private sector decisions are economic decisions no matter how great their political impact. In the private sector, economic decisions that have bad political consequences can make you unpopular, but decisions that are politically popular and have bad economic consequences can put you out of business.
There is ample evidence that the growth of teacher unions was a factor in the decline of the quality of public education. The dramatic rise in teacher union membership and collective bargaining in public education began in 1962. By 1976 teacher union membership had more than doubled. The decline in SAT scores began in 1963 and continued throughout this period. Yet all of the studies on the state of public education in America and the challenges it faces in the future completely ignore the question of the union role in the decline of quality.
Saul Alinsky, the radical leftist who trained so many union organizers, told his students that they must "make the enemy live up to their own book of rules." This tactic gives the unions a big advantage. Organizers seek out, not avoid, controversy, resorting to lies if necessary. In outlining the principles of community organizing in his book “Rules for Radicals,” Alinsky wrote that an organizer “must search out controversy and issues, rather than avoid them, for unless there is controversy people are not concerned enough to act.” Alinsky said an organizer acts with the “conviction that all the angels are on one side and all the devils on the other.” It’s not enough to demonize the opposition, the president must also convince us – and perhaps himself – that heaven is on his side.
Time and again public officials have described their shock and disbelief at what a union had done to them personally during organizing campaigns or labor disputes. Such activity was entirely predictable because it was almost textbook Alinsky. Their response has generally been that, if they had only known what to expect, they could have prepared for it and taken steps to neutralize its worst effects. Alinsky emphatically states that the end justifies the means but cautions that extreme means are only justified in certain situations. He also had a set of rules for what he called power tactics" or the means used to "take." He described it as "how the Have Nots can take power away from the Haves." Even a cursory review of Alinsky's 'Rules for Radicals' reveals that a union activist schooled in them will have no compunction about using almost any tactic in a conflict with a public agency. In fact, radicals must often create issues to stir up problems in order to radicalize their potential followers. The tactic that seems to shock public officials most is the personalization of the attack -- union leaders use the "pick it, freeze it, personalize it and polarize it" tactic no matter how distasteful this might be -- Alinsky says that, even if the decision is 48% to 52%, once it is made the opposition becomes "100 percent devil." Even if public officials are not willing to respond in kind to this sort of tactic, a great deal can be accomplished before a conflict by warning audiences what will happen.
Federal employees do not have collective bargaining and we're doing OK. We got a pay freeze this year, but all in all we're doing OK. We pay, like most in the private sector, 7 to 8% for our pension plans [actually, they pay less than 1% while taxpayers pay almost 12% toward federal employee pensions]. We also pay quite a bit (depending on which plan you choose) for our health plans. There are just as many states in the USA that do not have collective bargaining as compared to those who do. Collective bargaining is not a "right" like so many commentators have stated during this debate. States are sovereign entities that may or may not choose to allow collective bargaining. When you think of all the time, effort and money spent on an annual basis connected with school boards negotiating teacher contracts with professional union negotiators, it's horrendous. The system has been stacked in a lopsided way to favor the unions. Then let's take a look at how things really work. Unions give boatloads of money to the democrats (legalized bribes - campaign contributions), the democrat lawmakers make sure legislation then favors the unions, unions then continue to collect forced union dues through public worker's paychecks, then that money then gets recycled back to the democrat politicians. The union reps are fat, dumb, and happy, the public employees get unbelievable benefits paid almost in full by the taxpayers, and it goes on and on. This is why collective bargaining needs to stop. This system is corrupt with union dues mandatorily being confiscated from union workers then laundered into campaign donations back to the democrats. My hat goes off to Governor Walker!! This is not about rights. It's about corrupt unions wanting to keep their coffers intact. [DOD Employee - Navy, February 24, 2011]
Public workers, state or federal, should not be able to unionize. Unions have forced benefits that can not be sustained. Why should union employees not contribute to their health care or pensions? There should not be ANY defined benefit plans, and public employees should pay an appropriate portion of their benefit cost. It is time our entitlement society grew up and faced reality. One more thing -- it is not just Republicans that are trying to bring spending down to a sustainable level, but all fiscal conservatives, regardless of party. [Fedagainstunions, February 24, 2011]
By David Y. Denholm, Public Service Research Foundation
Copyright 2001
Introduction
The movement toward public sector unionism and collective bargaining began in the late 1950's. Its proponents ought to be forgiven for their failure to foresee just how harmful it would be to our nation's governmental institutions. They had no empirical evidence on which to base their ideas.
Now, almost forty years later, the politicians who insist on perpetuating the compulsory public sector collective bargaining laws that have given public sector unions disproportionate power in determining the size, cost and quality of public services are less easily forgiven. The record is clear. It is an unmitigated disaster.
But, politicians are, after all, politicians and the laws that gave public sector unions so much influence on government decisions have also made them into very powerful political forces throughout the country.
Fortunately, there is a new mood sweeping the country and the public is not content to allow politicians to maintain business as usual with special interests.
Already, in small ways all across the country, public sector union power is being successfully challenged. But, Rome was neither built nor burnt in a day. There is a long way to go to restore the proper balance between the public interest and the interests of public employees.
I hope that this fourth edition of Beyond Public Sector Unionism: A Better Way will continue to have a positive influence in that direction.
The ideas in this booklet are constantly in process. I welcome all comments and suggestions for consideration in future editions.
The nature of unionism. Adversarial - Monopoly - Equals at the table - Impasses.
The public interest. Harmony - Equity - Employee rights v. Union Privileges - Public Control
Beyond Public Sector Unionism: A Better Way The historic perspective. Union penetration in the work force - Government support of unions - Competition and technology - Unions and quality-Empowering workers -Communications - Dues check-off - Union political spending - Sources of support.
The Case Against Public Sector Collective Bargaining
Public sector collective bargaining is a creature of the late 1950s and 1960s. The academicians and politicians who theorized about it and legislated its beginnings can be forgiven for having erred because they were working in a void with no empirical evidence as to how it would work.
Public sector collective bargaining as we know it in the 1990s is a failure. There is a very strong case against it but the laws which mandate it have created and added to the political power of the public sector unions. They will not lightly relinquish the power they have achieved. Therefore, the case against public sector unionism must have both theoretical and political dimensions.
To understand the utter futility of using the collective bargaining process to establish equity and harmony in public employment, it is necessary to briefly review the basic premises of our system of government and the fundamental nature of unionism and collective bargaining.
Differences between the Public and Private Sectors
We live in a society with two distinct sectors--the public and the private.
Unionism and collective bargaining are products of the economic decision making process of the private sector of our society. Despite this, the National Labor Relations Act, which was designed in and for our private sector, has been used as a model for all public sector bargaining laws, with minor variation. Those who imposed collective bargaining on the public sector failed to appreciate the differences between the public and private sectors.
The public sector is monopolistic; there is a single source of supply for government services. There is only one fire department, one police department, one system of public education. "The public sector provides essential services." The private sector is competitive; there are alternative sources of supply for the goods and services produced. There are a multitude of choices in everything from automobile dealerships to grocery stores.
The public sector provides essential services. It is the very nature of government to provide on a monopoly basis those services which everyone needs.
The private sector provides nonessential services. There are public choices involved as to what sort and how much of private sector goods and services to buy and use, whether it be an automobile or a television or what brand of gas to buy or what channel to watch or whether to drive a car or to watch television at all.
This is not to say that some private sector goods, such as food, are not essential. But, in many cases, the government provides essentials through programs such as food stamps. Also, some may choose to argue that many government services are far from essential, but that is an argument against government providing that sort of service rather than an argument against the premise.
Political v. Economic
Public sector decisions are political decisions no matter how great their economic impact.
Government makes decisions every day that have profound economic consequences, but these decisions are based on political, not economic, considerations. In the public sector, decisions that are politically popular but economically ruinous can get you reelected. Decisions that are economically sound but politically unpopular are ruinous.
Private sector decisions are economic decisions no matter how great their political impact. In the private sector, economic decisions that have bad political consequences can make you unpopular, but decisions that are politically popular and have bad economic consequences can put you out of business.
Sovereign v. Free Contract
Government--the public sector--is sovereign, and no other institution or enterprise in our society is sovereign. Sovereignty is the power to use force--to compel. Under our democratic system only government is sovereign. Governmental sovereignty is derived from popular sovereignty which we as citizens give to government, within constitutional limits through our elected representatives, in the interest of order, security, and the public good.
Government's sovereignty is obvious in such things as compulsory school attendance laws, in its power to collect taxes and in its power to violate personal and property rights in the public interest. "A government which is not sovereign is a contradiction of terms." All economic and social activity in the private sector is governed by free contract. You only have a free contract when both parties want one. You cannot be compelled to buy the product of a particular company. Businesses cannot be compelled to join a business or trade organization. Support of churches is entirely voluntary. The list goes on and on.
Sovereignty is misunderstood. Many think of it in terins of the "divine right of kings." It is useless to argue that sovereignity is an outdated concept. Sovereignity is not something that government can choose to have. A government which is not sovereign is a contradiction of terms. No matter how pluralistic our society becomes, it is the sovereign nature of government which guarantees the order necessary for the participation in that pluralism by the individual citizens.
It may be argued that there are compulsory public sector bargaining laws in many states and that public order has not broken down. This also misses the point. Every time that we elect representatives to run the public's business and they cannot carry out their programs because of opposition from public sector unions, sovereignty has broken down and we have all lost.
That said, let's take a look at the nature and basic premises of unionism and American labor policy.
The Nature of Unionism Adversarial
Unions view the employer-employee relationship as an adversarial one. The unions believe, or at least want their members to think, that employers are by their nature exploitative and that without the collective power of the union, the individual unorganized employee is helpless against the various forms of capital formation which employers represent.
While this may be true in the private sector, there is no reason to believe that it would be true in the public sector. The private sector is governed by the economic incentive known as the profit motive.This system of economics has provided Americans with more goods and services and a higher standard of living than any other economic system in the world, but it is not applicable to many areas of the public sector of our economy. Competition and the profit motive are at the heart of the union contention that employers are exploitative, and that viewpoint leads the unions to an adversarial relationship.
The absence of competition and the profit motive should cause us to then ask whether an adversarial relationship is necessary or desirable in public sector employer-employee relations.
Government is in the business of providing services. Providing these services well is what gains votes, the bottom line in politics. To do this requires well trained and reasonably well satisfied employees. Government is in competition with the private sector to hire these workers. This gives government ample incentives to treat employees well and compensate them fairly. In fact, it is likely that public officials, both elected and appointed, will find themselves as allies with government workers rather than adversaries in many instances.
Monopoly
Unions insist upon a monopoly in representation. If a majority of employees in a bargaining unit desires representation by a union, the union then imposes its representation on the minority. In the private sector this is harmful to the interests of some employees, but in the public sector it results in a system contrary to the fundamental guarantee of liberty under the Constitution. The First Amendment to the Constitution of the United States guarantees citizens the right to petition the government.
Granting unions the exclusive right to represent government employees in their employment relationships with the government denies public workers this right in one of the most basic areas of concern--their jobs. "The effect of giving unions monopoly bargaining power is to make the union the workers' economic sovereign." The effect of giving unions monopoly bargaining power is to make the union the workers' economic sovereign. The union decides the terms and conditions under which an employer may offer employment, and the union has the exclusive right to represent employees in grievances. This puts the public employee in the situation of having two sovereigns, the government and the union.
Equals
In theory, collective bargaining brings the employer and the employees to the bargaining table as equals. This is a concept appropriate only to the private sector. Government, because of its sovereign nature, is in great peril when it recognizes any small special interest group as its equal. A truly equal relationship causes broad public concern about the effectiveness of representative government, yet a less than equal role for the unions causes frustration for employees who have been led to expect too much from unionism. The only truly satisfactory situation for the union is that of superiority. Such a situation, of course, causes widespread voter/taxpayer dissatisfaction with government.
Impasses
This brings us to the final element in the nature of collective bargaining-impasses. In collective bargaining it is the role of the unions to make demands and the role of management to respond to those demands. At some point management is bound to find itself unable to satisfy all the union demands. When an impasse occurs, the union must have some means of enforcing its demands. The traditional means of response to management recalcitrance is to threaten a strike. "In the public sector the strike is a political weapon." In the private sector the strike is an economic weapon.The employer faces economic losses through lack of business, and the employee faces economic losses through loss of wages. If there is a strike at one provider of a good or service, consumers - the public - can shift to another provider or not purchase at all.
In the public sector the strike is a political weapon. The employer does not suffer an economic loss and in many cases, particularly in education where most public sector strikes occur, neither does the employee.
Because of its political impact, the public sector strike is disruptive of the normal political process. Under normal circumstances, divergent interest groups within society, all of whom have a legitimate interest in public policy questions, exert pressure from various directions on elected representatives. Of these groups, a union of public workers is the only group which has the power, if not the legal right, to unilaterally deprive the rest of society of an essential service. Once this occurs, divergent political forces show a strong tendency to coalesce into a unified voice demanding a restoration of service.
The only way to restore the service, in most instances, is to give in to the union's demands. Thus the union, by using a strike or the threat of a strike, can dominate the decision process and control the size, cost, and quality of government service.
The proponents of unionism and collective bargaining in the public sector based on the private sector model ignored the essential differences between the decision making processes in the two sectors and the conflicts inherent between the nature of unionism and the nature of government.
An even better appreciation for the full ramifications of this problem can be found in studying the conflicts between unionism and the public interest.
The Public Interest
In order to fully appreciate the case against public sector unionism, it is important to understand why public sector collective bargaining is contrary to the public interest.
To do this, we must determine what is the public interest in public employment. This may prove to be many things to many people, but there should be universal agreement that it includes the following:
A peaceful, stable employer-employee relationship;
Protection of the rights of all public employees;
Protection of the right of the people through their elected representatives to control government policy and the cost of government;
Providing governmental services in the most efficient and orderly manner possible.
Based on any objective standard, collective bargaining, as it has developed in the industrial or private sector of America's economy, does not enhance any of the above in the public sector. "Compulsory collective bargaining is destructive of a peaceful, stable employer-employee relationship." In 1959 Wisconsin was the first state to enact compulsory public sector bargaining legislation. Since then more than forty states have followed suit in one form or another. The proponents of bargaining were astute. They knew that if they told the public that unionism and bargaining in the public sector were intended to give unions a disproportionate amount of influence in the decision making process, no one would have bought the idea. So they talked in terms of equity and ensuring harmonious employer-employee relations. On both scores the results of compulsory public sector bargaining have not only failed to fulfill their promise but have had an effect completely contrary to their intended purpose.As a result, public employees are increasingly hostile to their employers, and there is increasing public hostility toward public workers.
Harmony
The imposition of collective bargaining on public sector employer-employee relations results in an increase in strike activity. In 1958, before the passage of the first public sector collective bargaining law, there were 15 strikes against government. By 1980, after thirty-seven states had enacted compulsory public sector bargaining legislation covering one or more groups of public employees, there were 536 strikes.
After President Ronald Reagan's firm handling of the PATCO strike in 1981, the number of strikes against government declined by about 50% and the Bureau of Labor Statistics ceased reporting on strikes in the public sector, making further analysis of this issue impossible. But, it is worth noting that between the period 1958 to 1980 in no case did passage of a public sector bargaining law result in a decrease in strike activity.
Compulsory collective bargaining is destructive of a peaceful, stable employer-employee relationship. This is true statistically, from the facts available from areas which have experimented with it, and can be deduced from the very nature of the collective bargaining process.
But, the proponents of compulsory public sector collective bargaining have argued that such laws would serve to reduce public sector strike activity. They claim that forcing government to recognize and bargain with unions would remove the cause of strikes by providing formal channels for the resolution of differences.
It is claimed that bargaining legislation, by reducing the number of recognition strikes, would result in a net reduction in public sector strike activity. Jack Stieber, author of a Brookings Institution study entitled Public Employee Unionism, is often cited out of context to support this contention.
Clearly, there is little relationship between the incidence of government strikes and state laws regulating labor relations in public employment. Michigan, one of the three states with the largest number of strikes, has had a comprehensive law since 1965, while Ohio and Illinois, the other two, have no state statute providing collective bargaining for public employees. Other state patterns are similarly inconclusive. The one effect of laws that can be documented is that they reduce greatly the number of strikes over the issue of union recognition...
In fact, Stieber recognizes the true relationship between bargaining laws and strikes. The rest of the text indicates this:
But other issues, particularly wages, have apparently increased the number of strikes sufficiently to more than compensate for the elimination of union recognition as an important issue in states with public employment laws. (Emphasis added)
"In states which have adopted compulsory public sector bargaining laws, there is a tremendous increase in the number of strikes whether legal or illegal."
The Bureau of Labor Statistics of the U.S. Department of Labor began to keep detailed statistics on public sector strike activity in 1958. This database allows us to examine strike activity before and after enactment of bargaining legislation.
A study of this data covering all strikes against government from 1958 to 1980 show that in most states which have adopted compulsory public sector bargaining laws, there is a tremendous increase in the number of strikes -- whether legal or illegal.
A comparison of strikes before and after the enactment of a public sector bargaining law shows a correlation between passage of such laws and a fourfold increase in strike activity on a national average. These figures are dramatized by examples such as Michigan where there was one strike against government between 1958 and 1964. In 1965 a public sector collective bargaining law was enacted which made strikes illegal. Between 1965 and 1980 there were 759 strikes against government in Michigan. In Pennsylvania there were 72 strikes in the twelve years prior to the passage of a compulsory public sector collective bargaining law which legalized strikes in 1970, and 767 strikes in the eleven years followmg enactment.
On a national average, there have been 1.34 public sector strikes per year in states prior to passage of compulsory public sector bargaining laws and an average of 5.00 strikes per year after passage of such laws.
Equity
Unions in the private sector speak of equity in terms of the workers "fair share" of the value of production or of profits. No such measure is available to the public sector worker.
If we define equity for public sector workers as compensation comparable to their counterparts in the private sector, it is easily demonstrable that unionism and collective bargaining have as a natural consequence disequity rather than equity.
In the private sector there is little argument that a unionized worker earns more than a nonunionized worker doing the same work. Despite the obvious fact that our national labor law gives considerable advantages to unions in organizing campaigns, only about 11 percent of the workers employed in the private sector have elected to be represented by unions.
Since unionism is more concentrated in the basic industries where employment is in larger units, it is safe to say that far less than 11 percent of the employers offer employment under the terms of a union contract. The average compensation for work in the private sector is certain to be less than the union negotiated wage. If a consequence of unionism is higher than average pay, how can this be called equity?
That unionism has the same impact in the public sector is shown by postal wage activity since passage of the postal Reorganization Act in 1967. In 1970 the average postal worker earned $7,777 per year, while the average manufacturing worker in the private sector earned $7,440 per year. The Reorganization Act imposed the NLRA on employer-employee relations in the postal service, ignoring the monopoly essential/political/nature of the service. (The postal service work force is very heavily unionized.) By 1976 the average pay of a postal worker had risen 69 percent to $13,127, while the average manufacturing worker's wage had increased only 57 percent to $11,703.
Rising public discontent has focused on the public employee, while public employees increasingly take a hostile attitude toward the public. Because public sector collective bargaining is a sacrosanct institution and is very poorly understood by both groups, it is not recognized as the source of the problem.
Employee Rights v. Union Privileges
It is also a widely held misconception that compulsory public sector bargaining laws somehow guarantee "rights" to public employees. Nothing could be further from the truth. In fact, close examination reveals that, if anything, the opposite is true and that compulsory public sector bargaining laws give powers and privileges to unions at the expense of the rights of individual public employees.
Public employees, like all American citizens, have the right to join a union. This is a right protected by the First Amendment to the Constitution of the United States. No law is needed to guarantee it and no law can violate it. Beyond this, all the so-called rights contained in compulsory bargaining laws are union rights, not employee rights. "Compulsory public sector bargaining laws give powers and privileges to unions at the expense of the rights of individual public employees."
To illustrate this point, almost without exception, such laws require that the union be the sole or exclusive representative of all the employees in a unit. This denies employees the right to represent themselves individually or to be represented by another organization of their own choosing. This monopoly power granted to the union is usually carried to the point of denying the individual employee the right to meet with the employer to discuss a grievance unless the union representative is given the opportunity to be present.
Unions commonly exploit their monopoly bargaining power by insisting that because they are "forced" to represent all employees, that all employees, having lost the right of representation to the union, should be forced to join or support the union as a condition of employment. This violates each employee's right to freedom of association and gives the union greatly increased power in determining the employment destinies of the employees. "Public sector collective bargaining makes public employees super citizens' and relegates the rest of the public to second class status."
Granting unions monopoly bargaining privileges and the power to compel membership or support cannot be construed as guaranteeing any "rights" to public employees.
The proponents of compulsory public sector collective bargaining laws play upon the public's sense of fair play by saying that denial of public employees' right to collective bargaining makes them "second class citizens." There is no "right" to collective bargaining in either the private or public sector.
The U.S. Supreme Court has been quite clear about this in several decisions.
Rather than the lack of collective bargaining privileges for public sector unions making public employees second class citizens, the existence of public sector collective bargaining makes public employees "super citizens" and relegates the rest of the public to second class status.
Public Control
Nor can it be said that public sector bargaining laws protect the right of the public to control government policies and costs through its elected representatives.
The most fundamental violation of this principle is inherent in the very nature of the laws and leads to their designation as "compulsory" bargaining laws.
Public sector bargaining laws "compel" elected public officials to recognize and bargain with unions. This immediately deprives the representatives of the people of the power to determine whether such recognition and bargaining are, in fact, in the public interest. "Collective bargaining laws create an adversary relationship between union and employer."
This compulsion to bargain is normally defined as an obligation to bargain "in good faith." There is no clear definition of "good faith," but experience with similar provisions in other laws leads to the conclusion that, despite legislative language to the contrary, the courts have ruled that in order to bargain "in good faith," the employer must be willing to grant some concessions to unions' demands. Thus, the elected official is in double jeopardy; not only must he bargain, he must make concessions.
By making the union a full and equal partner at the bargaining table, compulsory public sector bargaining laws deprive the public of its right to participate in policy making. This point was emphasized in a US District Court opinion which upheld the constitutionality of a North Carolina law, which declared public sector union contracts to be void. The Court said:
Moreover, to the extent that which public employees gain power through recognition and collective bargaining, other interest groups with a right to a voice in the running of the government may be left out of vital political decisions. Thus the granting of collective bargaining rights to public employees involves important matters fundamental to our democratic form of government. The setting of goals and making policy decisions are rights inuring to each citizen. All citizens have the right to associate in groups to advocate their special interests to the government. It is something entirely different to grant any one interest group special status and access to the decision-making process.
By their very nature, collective bargaining laws create an adversary relationship between union and employer. This makes strife inevitable. Most public sector bargaining laws, in the realization that they are creating problems, provide for a system of impasse resolution. Usually, this takes the form of mediation, fact finding and arbitration. These systems further serve to deprive the elected representatives of the people of their responsibilities.
The unions believe that no employer will seriously consider a union demand, if it knows that the union has no power to enforce it. To enforce their demands, unions must have the power to strike. As Sylvester Petro put it,
"Collective bargaining unsupported by the strike is a sham institution; government whose employees may strike is no less a sham."
Another scholar from the opposite side of the ideological spectrum on the question of unionism, Theodore Kheel, expressed the same sentiment,
"Collective bargaining and strikes are like Siamese twins."
"Thus, public sector strikes enjoy a heightened degree of effectiveness not shared by private sector work stoppages." Most concern about strikes in the public sector focuses around the deprivation of public services. There is no doubt that this is a very real problem, but it distracts attention from an even more important consideration. Strikes against government are disruptive of the normal political process because they tend to coalesce divergent political views for a brief time into a single demand for the restoration of public service.This gives the union disproportionate power and results in government decisions which have short-term political benefits and disastrous long term consequences.
The usual public reaction to the strike is pressure on elected officials to restore the disrupted service. Thus, the victims become the unwitting ally of the union. If the cost of restoring the disrupted service is capitulation to union demands, elected officials, caught between angry strikers and an angry public, usually must do so. Thus, public sector strikes enjoy a heightened degree of effectiveness not shared by private sector work stoppages. "Therefore, collective bargaining as an institution is inappropriate to government."
Professors Harry H. Wellington and Ralph D. Winter, in their Brookings Institution Study, "The Unions and the Cities," focus on this problem concerning the strike weapon:
The trouble is that if unions are able to withhold labor -- to strike -- as well as to employ the usual methods of political pressure, they may possess a disproportionate share of effective power in the process of decision. Collective bargaining would then be so effective a pressure as to skew the results of the 'normal' American political process.
...Since interest groups other than public employees, with conflicting claims on municipal government, do not, as a general proposition, have anything approaching the effectiveness of the strike -- or at least cannot maintain that relative degree of power over the long run -- they may be put at a significant competitive disadvantage in the political process.
"Binding arbitration, by the very nature of the process, is a 'no lose' proposition for the unions." There is no doubt that collective bargaining means strikes. There is also little question that strikes against government are intolerable.Therefore, collective bargaining as an institution is inappropriate to government.
Some states in an effort to avoid this problem have instituted compulsory binding arbitration as a means of resolving labor disputes in the public sector. If anything, binding arbitration is worse than strikes.
Strikes destroy democratic government by giving the public sector union - a very small special interest group - disproportionate influence and therefore effective control of the public decision making process. Binding arbitration completely removes elected officials from the process. Binding arbitration, by the very nature of the process, is a "no lose" proposition for the unions. An arbitrator will never award a settlement that is anything less than management's final offer. The union is therefore able to obtain everything possible through the bargaining process aided by its political influence and then go to arbitration knowing that it can do no worse.
In many states which have enacted binding arbitration laws there are active movements to repeal them. But repeal is difficult because the collective bargaining laws greatly increase the political power of the unions.
State legislators often approve binding arbitration because its effect is felt at the local government level. One striking example of this is in Michigan where State Senator Coleman Young was the sponsor of a binding arbitration law. Later, as the Mayor of Detroit, Young said,
"We know that compulsory arbitration has been a failure. Slowly, inexorably, compulsory arbitration destroys sensible fiscal management."Arbitration awards "have caused more damage to the public service in Detroit than the strikes they were designed to prevent."
Clearly, laws which compel elected officials to recognize and bargain with unions in no way serve to protect the right of the citizen-taxpayer to control their government.
Finally, do compulsory public sector bargaining laws in any way promote more efficient or orderly delivery of public services?
As already noted, there is a strong and direct correlation between collective bargaining and strikes which disrupt public services.
Beyond this, union contracts tie the hands of elected officials and make it impossible for them to respond in a timely fashion to economic or natural disasters and emergencies. One only need look at New York City's financial default in the 1970's to see how completely destructive absolute power in the hands of public sector unions can be.
In addition, public sector bargaining tends to telescope the government decision-making process. Public sector union contracts frequently deal with subjects beyond wages, hours, terms and other conditions of employment. These have a direct impact on a very broad variety of public policies.
It is the nature of negotiations to make concessions and compromises when faced with a deadline. As a result, many contract agreements are made at the last moment. The elected representatives of the people are then faced with the need to consider, in a very brief time, a document which will effect a wide range of other decisions. There is not time under these circumstances for public review and for informed comment from other interest groups.
Most public sector bargaining bills, in realization of the fact that they create more problems than they solve, provide for the establishment of a public employment relations board to resolve problems which arise under the law. These boards are cumbersome new bureaucracies which greatly increase government costs. They are given broad regulatory powers from which locally elected public officials have little or no recourse. "No matter what the real intent of these laws, by any objective standard they are not in the public interest." Public sector bargaining laws also lead to such inefficient practices as the collection of union dues at the tax payers' expense, and giving union officials, who are public employees, time off at full pay while engaged in union activities.
It is clear, therefore, that no matter what the real intent of these laws, by any objective standard they are not in the public interest.They represent an expression of the selfish self-interest of public sector union organizers and, indirectly, the interest of the politicians who enact them in order to curry favor with the union's political operatives.
Since public sector collective bargaining is so contrary to the public interest, it is also essential to understand how it became so widespread. Actually, public sector collective bargaining is a relatively new phenomenon.
In the middle of the 1950s some academicians began to toy with the idea that collective bargaining might lead to more harmonious and equitable employer-employee relationships in the public sector.
In 1955 George Meany, the President of the AFL-CIO, said,
"It is impossible to bargain collectively with the government."
And as late as 1959 the AFL-CIO Executive Council was on record as believing that, "in terms of accepted collective bargaining procedures government workers have no right beyond the authority to petition Congress - a right available to every citizen."
At about the same time, however, union membership as a percentage of the work force began to decline and the number of people employed by government began to grow. Union officials saw the emerging public sector as the new growth industry to replace the dues dollars and political clout they were losing from their decline in the private sector.
In 1958 public sector union membership was only 1,035,000 or 12% of a work force of about 8.5 million. At that time the private sector work force was about 43 million and union membership was 16,933,000 or 39%.
In the next two decades, the federal government and most states instituted comnpulsory public sector bargaining schemes. In addition, unions found that they could use their political power to prevent any employer resistance to union organization in the public sector at the local level once a state enacted a compulsory public sector collective bargaining law.
Between 1958 and 1978 the public sector work force grew by 83% while the private sector work force grew by only 39%. Public sector union membership grew to 6,019,000 which was 39% of a public sector work force by then numbering 15,630,000. By 1978 private sector union membership had risen to 18,116,000 but was only 20% of the work force.
The decision to push for compulsory public sector bargaining laws was indeed a profitable one for the unions. On the other hand it was a failure for those who thought that it would lead to better government.
In 1978, Cornell University law professor, Robert S. Summers, concluded his monograph entitled Collective Bargaining and Public Benefit Conferral: A Jurisprudential Critique by saying,
Collective bargaining and the process of democratic public benefit conferral are not felicitous bedfellows. While it is possible to shore up these processes through the promulgation of codes for neutrals (and through other reforms), the extent its unhappy effects can be reduced or ameliorated by these means is limited. Abandonment of bargaining is necessary, for this and other reasons.
Dr. Myron Lieberman, whose book Education as a Profession in 1956 was one of the first to advocate collective bargaining for teachers and who was at one time a candidate for the presidency of the American Federation of Teachers, AFL-CIO, later became a collective bargaining practitioner. In his 1980 book entitled Public-Sector Bargaining, Lieberman turns full circle saying,
It would be desirable to have a new organizational structure to replace public sector unionism, but such a structure is not required to justify deunionizing public employment... The choice is not between public-sector bargaining and something better. Without in any way idealizing what preceded public-sector bargaining, it was better.
But, even if one wanted to, it is impossible to go back to the way things were before public sector collective bargaining. It is time to move ahead.The collective bargaining laws have given enormous political power to the public sector unions.At the present time repeal of these laws, no matter how desirable, is not feasible.
It is time for the public officials and the people they serve to devise new strategies for doing things a better way and going beyond public sector unionism.
Beyond Public Sector Unionism
Developments in public sector labor relations have been based upon and have followed the private sector model. Unionism in the private sector is in decline and has been so since 1954. The Bureau of Labor Statistics reports that in 1995 union membership constituted 10.3% of the private sector work force--down from a high of almost 40% in 1954.1
Private sector unionism went through an evolutionary process which is repeating itself in the public sector.
Unionism established itself in the private sector over a long period beginning at different times in different industries. This includes the evolution of craft guilds into labor unions. In many instances because of the historic master-journeyman-apprentice relationship, and because unions maintained high standards, employers found voluntary cooperation with unions to be to their advantage. The early history of the Operating Engineers union is a good example of this. It was not uncommon for employers to insist that Operating Engineer union members run the boiler rooms in their plants and they quite gladly gave the union "closed shop" contracts.
As unionism grew beyond the initial stage and sought contracts on a less than mutually beneficial basis, employers engaged in resistance. Anti-union campaigns and the so-called "yellow dog" contract--a contract under which an employee agreed not to become a union member as a condition of employment were typical of this stage. During this stage, employers also encouraged and established "company unions" -- unions which were controlled by, or at the least, friendly to the interests of the employer.
The next stage is characterized by government support, the passage of laws and the establishment of regulatory bodies which were intended to encourage the expansion of unionism and collective bargaining throughout the work force.
It is an accident of history that in the United States the early years of this period coincided with World War II and the Korean War. During these wars, war labor boards, in order to insure continued productivity, imposed union relationships, including union shops, on many employers.
The nation's first labor law was the Railway Labor Act of 1926, but its application was limited to a single industry, and it did not sanction any form of compulsory unionism.
It was the passage of the Wagner Act, the first National Labor Relations Act, in 1935 which extended government support of unionism and collective bargaining to most places of employment. This law and its successor, the Taft-Hartley Act, exempted both public employment and agriculture from its coverage. The Wagner Act included a sanction for the "closed shop" which was struck down by the U.S. Supreme Court in 1937.2
There is no way of knowing what the impact of the Wagner Act would have been in the absence of the war labor boards. Union penetration in the total work force, both private and public, which had been running at a fairly constant percentage for many years, was about 13% in 1935. By 1941 this had increased to almost 28%. At the end of World War II it was 35.5% and began to decline, but the Korean War gave it another boost until 1954 when it reached 34.7%. After this the decline became permanent.
In 1958 the Bureau of Labor Statistics began to keep track of public sector union membership and work
force penetration as a separate category. The table on the following page shows the changes in the work force and union penetration between 1958 and 1995.
The modern union movement blames much of its present decline on management's efforts to "bust the unions." The decline of unionism is due to a variety of factors including, but not limited to, the changing composition of the work force, the general level of educational attainment of the work force, the increasing role of women in the work force and legislated protections of the rights of workers.
No matter what factors were involved, the degree to which unions raised the price of labor as a factor in production above market rates contributed to the acceleration of the impact of each factor.
Union Membership as % of Work Force (Numbers in thousands)
Private Sector % Union Members Work Force Union Member
1958
39.3 43,066 16,933
1995
10.3 91,681 9,432
Public Sector % Union Members Work Force Union Members
12.4
8,297
1,035
37.7
18,358
6,927
TOTAL % Union Members Work Force Union Members
33.2
51,363
17,968
14.9
110,038
16,360
Source: Bureau of Labor Statistics, 1958 figures based on employees in nonagricultural establishments, 1995 figures based on employed wage and salary workers.
This union influence reflected not just in wages but in work rules the cost of the negotiating process and the cost of the threat or reality of strikes.
In another sense the unions were responsible for their decline by lobbying for the passage of legislation to guarantee workers protections previously only available under union contract.
In theory, one might have supposed that by imposing the cost of these benefits universally on employers through federal law, the unions would make unionized employers more competitive and decrease resistance to unions. The lessened appeal of unionism to workers seems to have been a bigger influence.
A recent study shows that the union wage differential is the largest single motivating factor in employer resistance and that employer resistance is the largest single factor in remaining nonunion (Freeman 1986).
There is no doubt that management in the private sector has realized that it is in its interest to move beyond unionism where possible and has set about to create an employer-employee relations climate in which unionism as we know it is outmoded and unnecessary. While there has always been union avoidance to one degree or another, its success and its prominence is a relatively recent phenomenon.
A policy of going beyond unionism could only succeed once unions were in decline. The decline was so much a creature of the union's own doing that making unions unnecessary was merely the employer's response to the situation which the union had created.
This sort of activity has taken many forms which are characterized by programs by employers to create an employer-employee relations environment where the majority of workers do not perceive the need for union representation, or even that they are better off without union representation.
The development of unionism in the public sector differs somewhat from that in the private sector but it is also similar. Most public sector unions evolved from employee associations. Many of these associations were fraternal in nature. Others were so all-encompassing that they tended to be dominated by people in top management positions. "In the public sector votes, rather than dollars, are the bottom line."
The National Education Association, for example, started out as a very broad organization encompassing all elements of the education community. This is analogous to the guild phase of unionism.
The senior education officials, usually school superintendents, who dominated the NEA sought a more activist role for it in representing teacher interests in response to a perceived threat from "the union" -- the American Federation of Teachers, AFL-CIO. At that time NEA was the equivalent of a "company union."
Government support in the form of compulsory public sector collective bargaining laws ultimately turned the NEA into a full blown union.
Just as union excesses resulted in its demise in the private sector and forced management find a better way, so are the same forces at work in the public sector. "A monopoly dealing with a cartel of labor has little problem passing on the costs inefficiencies and failures to the consumers." Nowhere is this more evident than in the field of public education. It, of course, must be recognized that the public sector is different from the private sector in several fundamental respects.
In the public sector, votes, rather than dollars, are the bottom line. In most instances where union political power (votes) was an inhibiting factor in decisions about opposing the unionization of public employees, either in the case of a state legislature considering mandatory public sector collective bargaining legislation or in the case of a local public body considering whether to resist the unionization of its own employees, it was because the politicians feared the political consequence of being perceived as anti-union by the broader union community, including the private sector unions, rather than the political power of any public sector union constituency.
This pressure was felt not just by elected officials, but by professional managers of public agencies. It is common practice for public agencies to have policies which prohibit managers from doing anything which might be construed as opposing the unionization of the agencies' employees.
The decline of private sector union membership and political influence will open doors for public sector management to take a more realistic view of the need to challenge unionism.
Another extremely important difference between the public and private sector is that the public sector is, in most instances, a monopoly.
A monopoly dealing with a cartel of labor has little problem passing on the cost inefficiencies and failures to the consumers, particularly when the consumers are forced to pay whether they use or benefit from the service.
A good example of the symbiotic relationship between a monopoly and a labor cartel was the airline industry. Government control of routes and rates prevented competition in the industry. Deregulation created a competitive environment in which the cartel costs of labor could no longer be passed on to the consumer. Unionism in the airline industry declined rapidly.
The excesses of public sector unions have already forced changes which have begun its decline.Public sector union penetration in the work force peaked in 1976 at 39.8% (Troy 1984) 3 and, as mentioned above, is presently at 38.7%.
The next logical step is for public sector management to take steps to move beyond unionism. But, to create an environment where this can happen, competition is necessary.
Competition need not be direct. In public education, it is not limited to the choice between public and private schools or giving public school clients a choice of public schools within a system. Contracting for educational services is another alternative just as are efforts by industry to educate the products of the public education system.
Technological advances have already made it possible for educators to have simultaneous interactive relationships with classes all across the country. The rising cost of teacher salaries combined with severe shortages of teachers in certain specialties will soon make such alternatives economically attractive.
When these things occur, unions will stand out as major obstacles to advances and education managers and elected officials will find union avoidance both economically and politically attractive.
A good example of the same phenomenon is now taking place in the postal services, where unions are entrenched.
The U.S. Postal Service has a legal monopoly on mail delivery.Union excesses have forced up the cost and slowed the service to the point that alternative forms of competition such as fax machines, electronic data transfer and express delivery services have become increasingly attractive.
The postal service has installed labor saving devices which are made ineffective by union contract provisions. The postal service response has been to contract out operations so that the work can be done efficiently by people other than postal service employees. "Postal Service management's only logical alternative is to find a better way to work without unions."
The postal unions have responded by boycott threats which have only been effective in certain heavily unionized areas because of support from non-postal unions.
Postal Service management's only logical alternative is to find a better way to work without unions. This will be increasingly politically attractive as rates increase and service worsens.
The unions, of course, are well aware of this problem and are doing what they can to prevent competition in any form. But, the forces of change at work in society make the expansion of competition in the provision of public services inevitable.
These forces are clearly at work in the field of public education with the rapid advance of technological change.
The present system dominated by unions is simply not capable of changing fast enough to keep up. "The present system dominated by unions is simply not capable of changing fast enough to keep up."
Society recognizes a different value between a recreation supervisor and a computer programmer even though they may have the same level of education and work the same hours. A union, for internal political reasons, cannot afford to recognize a different value between a physical education teacher and a computer science teacher.
A union opposed to pay scales which recognize the different value of different knowledge and the different value of relative levels of teaching skills is not able to function in this changing environment.
There is ample evidence that the growth of teacher unions was a factor in the decline of the quality of public education. The dramatic rise in teacher union membership and collective bargaining in public education began in 1962. By 1976 teacher union membership had more than doubled. The decline in SAT scores began in 1963 and continued throughout this period.
Yet all of the studies on the state of public education in America and the challenges it faces in the future completely ignore the question of the union role in the decline of quality.
This is not because educators are unaware of the unions' influence but because the unions' political influence within the education establishment is so strong that no such study or report can be accepted without union participation and the unions' quid pro quo for participation is that the role of unions is a taboo subject.
It might appear at first blush that so long as there are state laws which require union recognition and collective bargaining combined with impasse resolution processes increasingly culminating in binding arbitration, there is little which can be done short of repeal of these laws.
The lessons of the private sector experience belie this appearance. As noted above, public sector collective bargaining laws are based on the private sector model. The economics and politics of the marketplace coupled with the decline of unionism brought about changes in private sector policies toward unionism without any changes or repeal of the National Labor Relations Act.
Even with a collective bargaining relationship imposed by state law, there are many potential avenues for moving beyond unionism in the public sector and, again, particularly in public education. "The fact that employees are union members or are represented by a union does not mean that the employees like or support the union." The increasing emphasis on decentralizing control of public services characterized by "site based management" and "quality of work groups" offers fertile ground for moving beyond unionism. Union propaganda stresses the role of unions in "empowering" workers. Decentralizing control will truly empower workers and make union contract provisions obstacles to worker satisfaction and productivity.
A perfect example of this is available from Indiana. The state legislature enacted an education reform program called 21st Century. Part of this program included decentralizing the public school decision making process and the establishment of school committees which included school employee, parent and community representatives.
After its enactment the Indiana State Teachers Association warned its local bargaining agents that the implementation of 21st Century would result in strife between the union and its members and urged them to secure compulsory agency shop agreements in their next contracts so that these teachers would be forced to continue to financially support the union.
The fact that employees are union members or are represented by a union does not mean that the employees like or support the union. A study by the Survey Research Center seems to indicate that union members are more concerned about what their union is doing than what their employer is doing. (Lipset 1986)
It is important to keep in mind the impression employees get about management's attitude about unions. There are several ways in which employees may get the impression that management approves of union activity. "This gives employees the impression that management encourages support of the union and it greatly increases union income.
In many areas management still regards "membership in a professional organization" as a positive factor in evaluating employee job performance. When applied to union membership this sends the wrong signal to the employees.
Unless it is absolutely required by law, management should strongly resist giving unions dues check-off privileges. This gives employees the impression that management encourages support of the union and it greatly increases union income. In several instances on record, withdrawal of dues check-off privileges has resulted in substantially reduced union membership. It is not so hard for union organizers to pressure an employee into signing a check-off authorization once as it is to collect dues each month.
Union access to internal communication systems such as teacher mail boxes in the schools should also be avoided. It gives the employees the wrong impression about the unions legitimacy and facilitates the union's communications in its attacks on management.
Another means of creating a new opinion environment among employees is to keep them aware of union problems. Unions, like other institutions, suffer from corruption and internal strife. Keeping employees aware of these problems can put the unions on the defensive.
Many grievances are not grievances by employees against management so much as they are by employees against other employees. For example, if the grievance is about management's decision to promote or transfer an employee, it is really a question of why one employee was promoted or transferred rather than another. Creating a new environment in which unions are outdated can include letting employees know that when the union pursues such a grievance it is really against the employee, not management. ...a public employee can only be required to pay a union representative for the actual cost of representation..."
Unions in their representation function spend an inordinate amount of time defending the interest of employees who are in trouble for one reason or another. The employee most in need of representation is the one too frequently absent or whose behavior and relationship with coworkers results in problems.
The majority of employees are harmed by these few trouble makers or slackers.Making unions unnecessary can include a program to keep employees aware of the unions' role in the defense of these workers.
In public education professional liability insurance is a very strong incentive for union participation. Teachers are told in college and by their union in the work place that this coverage is very important. It is provided to them as a benefit by the union out of union dues. This insurance is very inexpensive. It could be provided by the school employer at little cost and remove an incentive for employee participation in a union.
Several studies have shown that the political views of union leadership at the national level are not in sync with the majority of union members. Keeping employees aware of these policies when they are controversial helps create a climate of opinion suspicious of the unions' motives.
Even though bargaining laws require that unions be the exclusive representative of bargaining unit members in negotiations, there are many opportunities to involve employees in work place concerns which do not involve negotiations on terms and conditions of employment. Channeling such involvement through mechanisms other than the union can show employees how much can be achieved through cooperative rather than adversarial processes. This can be particularly useful when the cooperative solution to a work place concern runs counter to the union's self interest and the union is forced to explain to its own members why they are wrong.
Many public officials have told me that any attempt to communicate with employees outside the collective bargaining process draws an immediate filing of an unfair labor practice complaint by the union for bargaining with other than the exclusive representative. In one case putting a suggestion box in a fire house brought such a charge.
As noted above, most state public sector collective bargaining laws are based on the National Labor Relations Act. Many state public employee relations boards give significant weight to National Labor Relations Board decisions in making decisions about unfair labor practices.
Several NLRB decisions seem to indicate that "labor-management" collaboration is illegal under the NLRA. In recent decisions the NLRB has taken pains to make it clear that not all cooperation is illegal and has set forth specific guidelines for legal cooperative activity. In the initial stages of development, it is the willingness to communicate outside union channels rather than the precise method or topic that is important.
For far too long, public sector unions have violated laws and court orders with virtual impunity in pursuit of power. It is all too common to see public sector unions engage in blatant violations of the law and to offer as their defense,
"We don't want to be doing this but we're doing it for the (fill in the blank)." If it's an illegal teacher strike, you can fill in the blank with "children." If it's a hospital strike, you can fill in the blank with "patients."
They never say they are doing it for personal gain. "It is high time that public officials took a page out of the unions' book by not being intimidated by union threats of unfair labor practice charges..."
Yet, when a public official even considers action that might be considered "anti union," the union threatens to file an unfair labor practice charge and the mere threat of such a charge is usually sufficient to deter the action.
There are many reasons for this. First is public misunderstanding. Too many people regard the filing of a charge as proof of guilt. Then, you have the cost of defending against the charge. The union already has attorneys in the state capital to pursue the charge with the public employee relations board, but the public entity, especially a small public entity, would have to spend a disproportionate amount of its budget sending an attorney to defend the charge. And, if they do, the union immediately attacks the public officials for "wasting the taxpayer's money defending their 'illegal' action."
Saul Alinsky, the radical leftist who trained so many union organizers, told his students that they must "make the enemy live up to their own book of rules." This tactic gives the unions a big advantage.
It is high time that public officials took a page out of the unions' book by not being intimidated by union threats of unfair labor practice charges and, in extreme cases, deliberately committing unfair labor practices when it is in the public interest. They should then go public with statements about the matter like "We don't really want to do this but, we're doing it for the (fill in the blank)."
They should pave the way for such action by communicating in advance about it with community opinion leaders like newspaper editors so that when the union files the charge, there won't be an assumption of guilt and the public will understand that it is necessary to expend the funds to defend against the charge.
On the subject of public employee relations board decisions, it must also be noted that unions frequently "pick on" smaller government units which do not have the resources to vigorously defend their interests or those with elected members who are very sympathetic to union interests when seeking board decisions to serve as precedents in their dealings with governments which have greater resources or whose elected officials are less sympathetic.
Management in the public sector must be alert to such union activity and be prepared to defend its interests, even when it is not directly a party in the dispute. Such actions may provide additional opportunities to communicate with employees about the problem of unionism.
Another area which should offer a fruitful ground for moving beyond unionism is the U.S. Supreme Court's decisions in a series of cases beginning with Abood (1976) and culminating in Lehnert (1991).
These decisions provide that a public employee can only be required to pay a union representative for the actual cost of representation and give employees due process rights in the determination of the size of the fee the union can charge.
After the decision, Abood which provided that nonmembers--agency fee payers--could not be charged for nonrepresentation costs, the unions were left in control of the determination of the amount. Generally, they said that 5% of dues were spent for nonrepresentation purposes.
For most employees who were not union sympathizers, 5% was not sufficient incentive to invite the wrath of union officialdom by switching from membership to a fee payer status.
The 1986 Hudson decision gave nonmembers due process rights in the determination of the amount of the fee. Due process includes notice of the amount to be charged with sufficient information on the determination, an independently audited statement of the unions finances and the right to resolution of challenges to the size of the fee by a neutral party.
Teacher union dues are quite high by most standards. Several court decisions based on Hudson have shown that a substantial amount of this money is spent for nonrepresentation purposes.
Public employers are liable for damages under Hudson for agreeing to a fee which does not comply with its standards. Often union contracts provide that the public employer will be indemnified by the union for any damages arising from the implementation of an agency shop clause in a contract. These contract provisions may give employers a false sense of security. Several recent court decisions have held that a union may not indemnify an employer for a violation of the due process rights of an employee.
In 1991, in Lehnert v. Ferris Faculty Association the Court established a three-part standard for determining whether a union can charge non members for an expense without impinging upon the non members' first amendment rights:
Union expenses must be "germane" to collective bargaining;
The expenses must be for activities that are justified by the government's vital policy interest in labor peace and avoiding "free riders"; and
The expenses must be for activities that do not significantly add to the burdening of free speech that is inherent in allowing an agency shop or union shop.
It is not unrealistic, based on presently available information, to imagine that a typical agency fee determined in full compliance with Lehnert would be 50% or less of union dues.
Conceivably, the final result of this process would be to leave the union with far less than a majority of full members. The union would then lose interest in the unit and it would be ripe for de-certification.
Providing employees with information about their rights under these decisions and aggressive participation in the process by which the fee is determined, aimed at keeping the fee as low as possible, will lessen the attractiveness of unions in several ways. It will diminish the funds available to the union. It will increase the incentive for employees to convert from full member to agency fee payer status. And, it will further the impression that management is more concerned with the rights of workers than the unions. "It cannot be overemphasized that being anti-union is not in any way being anti-employee."
The unions are not stupid and they know how much is at stake for them in this matter. It must be anticipated that programs aimed at moving beyond unionism will meet with strong union opposition. It is important, therefore, from the very beginning to build strong community support by sharing information about the negative impact of public sector unionism with business, civic and other community leaders.
It cannot be overemphasized that being anti-union is not in any way being anti-employee. The unions will attempt to portray any attack on the union as an attack on employee interests. Careful preparation and good communication will make such charges unconvincing.
Successful employer-employee relations may require some changes in management processes. One advantage enjoyed by the private sector is that managers are empowered to make many decisions at their own level. The more bureaucratic nature of the public sector frequently results in an inability of management to take actions to resolve problems rapidly.
Unions thrive on problems. Union organizers are schooled in techniques characterized by the slogan,
"When you don't have a problem, create one."
Where management can move quickly to resolve problems they are not allowed to fester. This denies opportunities to union organizers. "Most of the knowledge about making unions unnecessary rests in the private sector."
The political side of management, the elected officials, may need to give managers greater decision making authority. An alternative to this which preserves political control of public institutions is for elected officials to become more involved in the day to day workings of the institutions they govern. The movement toward what is referred to a site based management in public education may help resolve the problems caused by bureaucratic slowness in decision making.
Support for moving beyond public sector unionism should come from a variety of sources. Organizations like state and national associations of elected officials and managers could provide information on a regular basis and conduct workshops on the subject at their meetings and conventions.
Most of the knowledge about making unions unnecessary rests in the private sector.Since the private sector relies on the efficient delivery of public service, it should have a strong incentive to arrange cooperative programs to share this knowledge with the public sector.
In the private sector, there are firms which specialize in designing and implementing programs to make unions unnecessary. In many areas, the present political climate might not allow the expenditure of public funds for this purpose. It is conceivable that a local private sector employer's group could make these funds available.
This should be particularly true in the field of public education because business presently spends millions upon millions of dollars every year educating the products of public education and because the largest teacher union, the National Education Association, has a decidedly anti-business bias in its political and ideological activities, which cannot help but in some instances spread down through the organization to the indoctrination of students in the classroom. The question, thus, is whether present political and administrative management will move ahead with it or whether competition will replace them with others who will.
The above is intended to be suggestive rather than instructive. Public bodies considering a "Beyond Unionism" program would be well advised to consult with legal counsel. If counsel advises that it can't be done, seek a different attorney. The question must not be, "Whether or not?" but "How?"
Union excesses in the public sector, combined with the decline of public sector unions, have made it inevitable that management must find a better way to conduct its relations with its employees and to make the next logical step beyond unionism. The question, thus, is whether present political and administrative management will move ahead with it or whether competition will replace them with others who will.
1
The percentage of work force figures may differ from source to source depending on what work force definition is used.
Prior to 1981 the Bureau of Labor Statistics used both a "Total labor force" figure and another for "Employees in nonagricultural establishments." As an example of the difference, in 1978 the BLS reported a total labor force of 102,637,000 with a union penetration rate of 19.7% and employees in nonagricultural establishments of 85,763,000 with a union penetration rate of 23.6%.
Union membership figures were derived from reports from unions, which frequently included unemployed and retired members. It must be considered that union voting representation strength at AFL-CIO conventions is based on the size of union membership. Slight variations in the number of reported union members maybe due to internal union political considerations, which have more to do with convention voting strength and per capita dues payments than they do with the actual number of members the union actually has at the time.
The Bureau of Labor Statistics released no reports on this subject in 1981 and 1982. In 1983 a new reporting system was established. The defined work force was "Employed wage and salary workers." Union membership figures were determined from household surveys. No attempt has been made to correlate the data prior to 1981 with the data after1983. The post 1983 data is probably a more accurate reflection of the actual extent of union penetration in the work force.
In 1954 there were 49,022,000 employees in nonagricultural establishments of which 7,323,000 were government. Union membership was 17,022,000 of which about 1 million were in the public sector. This would indicate that private sector union penetration was about 38%, which is lower than the 39.5% presented elsewhere in this paper for 1958.
The apparent peak in union penetration in 1954 was due to a decline in the employees figure accompanied by an increase in the union membership figure.
2
In a "closed shop" a worker must be a union member in order to obtain employment. In a "union shop" a worker may obtain employment without being a member of a union but must join the union within a specified period of time, usually thirty days. A later court decision ruled that even in a union shop actual union membership was not necessary so long as the worker paid the union for representation. The court referred to this is "whittling down union membership to its financial core."
3
The growth in public sector union membership is sometimes hard to determine because of the distinction between unions and associations. In 1968, in recognition that employee associations in the public sector were acting as unions, the Bureau of Labor Statistics began to include tables on public sector employee association membership in their reports but maintained the distinction between the two. Much of the apparent growth of public sector union membership in the last fifteen years has come as a result of mergers or affiliations of associations with unions. This has served to inflate the union membership figures without actually adding to the number of employees who were members of organizations which were functioning as labor unions. In 1978 the 260,000 member New York Civil Service Employees Association became a part of the American Federation of State County and Municipal Employees, AFL-CIO, bringing its membership above the1 million mark. The next year the Bureau of Labor Statistics reported a 250,000 increase in the number of public sector union members. In 1984 the 97,000 member California State Employees Association affiliated the Service Employees International Union, with AFL-CIO. This affiliation increased SEIU's membership to 847,000.
References
Freeman, Richard B. (1986). The Effect of Union Wage Differential on Management Opposition and Union Organizing Success. Nashville, Tennessee: The American Economic Review, Vol.76, No.2. (92-96).
Troy, Leo & Sheflin, Neil (1984). The Flow and Ebb of U.S. Public Sector Unionism. Vienna, Virginia: Government Union Reveiw, Vol. 5, No. 2.
Lipset, Seymour Martin (1986). Unions in Transition: Labor Unions in the Public Mind. San Fransisco, California: Institute for Contemporary Studies.
Rules for Radicals
Over the years there have been repeated suggestions that public sector union organizers, especially those associated with the National Education Association, were being trained by Saul Alinsky or by his Training Institute.
Alinsky passed away in 1972. His methods and his ideals succeed him. In his book, "Rules for Radicals," he laid out the guidelines for radical organizers. Very frequently, the tactics used by unions mirror those advocated by Alinsky. It is quite likely that the training of many public sector union organizers includes a crash course based on Alinsky's teachings. Some confirmation of this is contained in an interview with a person who was once an NEA UniServ and the executive director of an NEA state affiliate. He warned:
"To understand the NEA - to understand the union - read Saul Alinsky.If you read 'Rules for Radicals,' you will understand NEA more profoundly than reading anything else. Because the whole organization was modeled on that kind of behavior which was really begun when NEA used Saul Alinsky as a consultant to train their own staff."
Time and again public officials have described to me their shock and disbelief at what a union had done to them personally during organizing campaigns or labor disputes. I have told them that such activity was entirely predictable because it was almost textbook Alinsky. Their response has generally been that, if they had only known what to expect, they could have prepared for it and taken steps to neutralize its worst effects
Here, therefore, is a thumb nail sketch of some of Saul Alinsky's 'Rules for Radicals,' taken from his book by the same name published in 1971 by Vintage Books.
Alinsky emphatically states that the end justifies the means but cautions that extreme means are only justified in certain situations. Here are Alinsky's rules to test whether the means are ethical.
One's concern with the ethics of means and ends varies inversely with one's personal interest in the issue.
The judgment of the ethics of means is dependent upon the political position of those sitting in judgment.
In war the end justifies almost any means.
Judgment must be made in the context of the times in which the action occurred and not from any other chronological vantage point.
Concern with ethics increases with the number of means available and vice versa.
The less important the end to be desired, the more one can afford to engage in ethical evaluations of means.
Generally, success or failure is a mighty determinant of ethics.
The morality of means depends upon whether the means is being employed at a time of imminent defeat or imminent victory.
Any effective means is automatically judged by the opposition to be unethical.
You do what you can with what you have and clothe it in moral garments.
Goals must be phrased in general terms like "Liberty, Equality, Fraternity," "Of theCommon Welfare," "Pursuit of Happiness," or "Bread and Peace."
He also had a set of rules for what he called power tactics" or the means used to "take."He described it as "how the Have Nots can take power away from the Haves." Here are his rules of power tactics.
Power is not only what you have but what the enemy thinks you have.
Never go outside the experience of your people.
Whenever possible, go outside of the experience of the enemy.
Make the enemy live up to their own book of rules.
Ridicule is man's most potent weapon.
A good tactic is one that your people enjoy.
A tactic that drags on too long becomes a drag.
Keep the pressure on with different tactics and actions, and utilize all events of the period for your purpose.
The threat is usually more terrifying than the thing itself.
The major premise for tactics is the development of operations that will maintain a constant pressure upon the opposition.
If you push a negative hard and deep enough, it will break through into its counterside.
The price of a successful attack is a constructive alternative.
Pick the target, freeze it, personalize it, and polarize it.
Even a cursory review of these rules for radicals reveals that a union activist schooled in them will have no compunction about using almost any tactic in a conflict with a public agency.In fact, radicals must often create issues to stir up problems in order to radicalize their potential followers.
With careful forethought any of these tactics can be defeated but in order to do so one must sometimes play be the same rules as the radicals.
For example, the tactic that seems to shock public officials most is the personalization of the attack. For the radical, it is not sufficient to attack the "administration" or the "board" they must attack a particular administrator or a member or members of the board. This is "outside their experience." They are simply not accustomed to having questions raised about their personal character because of differences of opinion on policy questions.
Public officials may seem trapped by this tactic because personally attacking an individual is "against their rule." If they react by attacking the "union," the organizer can then turn this around by telling his follwers, or potential follwers, that they have been attacked or insulted by the individual. Using the "pick it, freeze it, personalize it and polarize it" tactic, the reaction must be against a particular union activist, no matter how distasteful this might be.
Alinsky says that, even if the decision is 48% to 52%, once it is made the opposition becomes "100 percent devil." He refers to any effort to be objective or fair about your opponent as "political idiocy."
Even if public officials are not willing to respond in kind to this sort of tactic, a great deal can be accomplished before a conflict by warning audiences what will happen. For example, if, at the outset of, a union campaign public official were to warn the employees of the agency that the union was going to attempt to make it seem that they were incompetent, immoral and corrupt, when it happened they might be able to ward off the worst effects of such attacks by reminding the employees that they had predicted them.
It is particularly important that appointed officials get this warning across to the elected officials who appoint them and that the elected officials then inform other opinion leaders in the community.
Any effort to go beyond public sector unionism may elicit the type of tactics described above. If you anticipate such problems, you may wish to make copies of these pages and provide them to local newspaper editors and civic leaders.
Note: There may be change in the wind. Recently, at a legislative hearing on a public sector collective bargaining bill, representatives of both local and national unions testified. The local union officials were nowhere near as smooth as the pooh-bahs from Washington. After the hearing one of them was overheard in conversation with the representative of another national union as disdainfully saying,
With the Wisconsin showdown at a fever pitch, Mark McKinnon says America doesn’t need public unions anymore—they silence voters’ choice, redistribute wealth, and clog the political system.
Mark McKinnon, The Daily Beast
February 26, 2011
The manufactured Madison, Wis., mob is not the movement the White House was hoping for. Both may find themselves at the wrong end of the populist pitchfork. While I generally defend collective bargaining and private-sector unions (lots of airline pilots in my family), it is the abuse by public unions and their bosses that pushes centrists like me to the GOP.
It is the right and duty of citizens to petition their government. The Tea Party and Republicans seek to limit government growth to protect their pocketbooks. Public-union bosses want to increase the cost of government to protect their racket.
1. Public unions are big money.
Public unions are big money. Paul Krugman is correct: we do need “some counterweight to the political power of big money.” But in the Alice in Wonderland world where what’s up is down and what’s down is up, Krugman believes public unions do not represent big money. Of the top 20 biggest givers in federal-level politics over the past 20 years, 10 are unions; just four are corporations.The three biggest public unions gave $171.5 million for the 2010 elections alone, according to The Wall Street Journal. That’s big money.
2. Public unions redistribute wealth.
Public employees contribute real value for the benefit of all citizens. Public-union bosses collect real money from all taxpayers for the benefit of a few.Unlike private-sector jobs, which are more than fully funded through revenues created in a voluntary exchange of money for goods or services, public-sector jobs are funded by taxpayer dollars, forcibly collected by the government(union dues are often deducted from public employees’ paychecks). In 28 states, state and local employees must pay full union dues or be fired.A sizable portion of those dues is then donated by the public unions almost exclusively to Democratic candidates. Michael Barone sums it up:
“Public-employee unions are a mechanism by which every taxpayer is forced to fund the Democratic Party.”
3. Public unions silence the voters’ voice.
Big money from public unions, collected through mandatory dues, and funded entirely by the taxpayer, is then redistributed as campaign cash to help elect the politicians who are then supposed to represent taxpayers in negotiations with those same unions. In effect, the unions sit on both sides of the table and collectively bargain to raise taxes while the voters’ voice is silenced.
But the noisy mob in Madison is amplified beyond its numbers. Wisconsin faces a $137 million deficit this year, and a $3.6 billion shortfall in the next two-year budget. The proposals offered by Gov. Scott Walker would avert 5,500 layoffs of public employees and save $300 million.
The public unions, representing just 300,000 government employees in the Badger State, are trying to trump the will of the voters.Though voters don’t get to sit at the bargaining table, they do speak collectively at the ballot box.
4. Public unions are unnecessary.
The primary purpose of private-sector unions today is to get workers a larger share of the profits they helped create. But with a power greater than their numbers, these unions have destroyed the manufacturing sector, forcing jobs overseas by driving labor costs above the price consumers here will pay.
The government is a monopoly and it earns no profits to be shared. Public employees are already protected by statutes that preclude arbitrary hiring and firing decisions.
The primary purpose of public unions today, as ugly as it sounds, is to work against the financial interests of taxpayers: the more public employees are paid in wages and uncapped benefits, the less taxpayers keep of the money they earn.It’s time to call an end to the privileged class.And the White House makes a mistake if it thinks it can grow a manufactured and uncivil unrest into a popular movement. Voters will not follow those who flee.
As vice chairman of Public Strategies and president of Maverick Media, Mark McKinnon has helped meet strategic challenges for candidates, corporations and causes, including George W. Bush, John McCain, Governor Ann Richards, Charlie Wilson, Lance Armstrong, and Bono.
The New World Order Plan is spiritually based: it is a conflict between God and His forces, on the one hand, and Satan and his demonic forces on the other side. Anyone who does not know Biblical doctrine about God and Satan, and who does not know Scriptural prophecy, cannot comprehend the nature of the struggle facing the world today. - David Bay, Cutting Edge Ministries
For we wrestle not against flesh and blood, but against principalities, against powers, against the rulers of the darkness of this world, against spiritual wickedness in high places. - Ephesians 6:12
Now the brother shall betray the brother to death, and the father the son; and children shall rise up against their parents, and shall cause them to be put to death. And ye shall be hated of all men for my name’s sake: but he that shall endure unto the end, the same shall be saved. - Mark 13:12,13
For we are opposed around the world by a monolithic and ruthless conspiracy that relies on covert means for expanding its sphere of influence... Its preparations are concealed, not published. Its mistakes are buried, not headlined. Its dissenters are silenced, not praised. No expenditure is questioned, no rumor is printed, no secret is revealed. - President John F. Kennedy, April 27, 1961
The book in which they are embodied was first published in the year 1897 by Philip Stepanov for private circulation among his intimate friends. The first time Nilus published them was in 1901 in a book called The Great Within the Small and reprinted in 1905. A copy of this is in the British Museum bearing the date of its reception, August 10, 1906. All copies that were known to exist in Russia were destroyed in the Kerensky regime, and under his successors the possession of a copy by anyone in Soviet land was a crime sufficient to ensure the owner's of being shot on sight. The fact is in itself sufficient proof of the genuineness of the Protocols. The Jewish journals, of course, say that they are a forgery, leaving it to be understood that Professor Nilus, who embodied them in a work of his own, had concocted them for his own purposes.
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