Unions Must Yield in Face of Growing Debt

by Lyman Stone

Recessions and deficits provoke people to make sacrifices. Across the country, firms are cutting margins, employees are losing jobs, families are sacrificing vacations; the nation is cutting back and getting by, with difficulty. While many private-sector workers have been laid off, the story in the public-sector has been, let us say, less grim. Indeed, expanded federal spending, bailouts to state governments and the 2010 census (Did I mention expanded federal spending?) have led to enhanced federal employment.

Late last year, President Barack Obama announced a wage and benefits freeze for federal workers. That is a good start, but it’s not enough. The average salary for a federal civilian worker is over $81,000, compared to $50,000 for a worker in the private sector, according to the Bureau of Labor Statistics (BLS). A wage freeze would be fair if it were extended for, say, 10 years.

Why do they get paid so much more? And on that note, why so many holidays? According to The Economist Intelligence Unit, the average public-sector employee works 170-200 days a year; the average private-sector employee works 200-250 days a year (BLS). And yet still the public-sector employee is paid more for working less. Many public-sector employees receive pensions after they retire, whereas most private-sector employees have retirement plans. Newsflash: They aren’t the same.
Private employees are generally fired if they are unproductive, work in competitive environments and have outcomes-based standards. Public sector employees are rarely fired for any reason, and the very idea of judging a public-sector employee on outcomes is practically heresy.

Which brings us to Wisconsin. Yes, Wisconsin. It has a budget deficit. It also has very large public-sector union participation. Wisconsin wants to make state employees pay more into pension funds and medical insurance — a very rational course of action, given that these are the two biggest impending entitlement expenses that governments will face in the next 10-20 years.

The unions, in a rare spasm of civic sentiment driven by threats of mass layoffs if they refuse, have essentially accepted that. But the Republicans have also proposed to curtail union collective bargaining rights, both by denying automatic salary contributions (Workers would actually have to make voluntary donations — how unpleasant!), requiring yearly revalidation of a union’s legal status, and by restricting what types of deals can be made with local governments.

So those unions, and their supporters, are getting doctors to write them rather trumped-up sick notes (which they can do with great liberty due to their prodigious sick time and vacation time they won in previous lobbying battles) so they can protest. About 55,000 of them showed up. Impressive, most impressive.

Then again, people will do anything to hold power. It’s high time states started to do what the federal government hasn’t had the spine to do since President Franklin D. Roosevelt: remind public-sector unions that they have (in Roosevelt’s words) “special obligations” due to a “special relationship” to the public. They should lead in sacrifice, not hold a state hostage to debt and inefficiency.


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