May 6, 2012

Creeping Union Socialism – The Effort to Recall Wisconsin’s Governor

by Harold Gershowitz

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With all of the focus on the 2012 presidential elections, many people have ignored the importance of the upcoming recall election in Wisconsin, in which Democrats’ unions in particular, are seeking to recall Scott Walker as Governor.  Walker was elected Governor in the Republican landslide of 2010, and he became a figure of some importance because Wisconsin, which was carried by the President in 2008, was part of the dramatic slide toward the GOP in 2010, and it is now likely to be an important swing state in 2012.  The recall election is scheduled for June 5.  Some digression into the history of all of this is important.

Walker became a figure of importance in a controversy due to the Wisconsin Budget Repair bill, which he proposed.  The bill was passed by the Wisconsin legislature, but it never passed the state senate, and it drew attention because Walker was denied a sufficient quorum when a group of Democratic senators left the state and hid out in Illinois.  Walker’s proposed Budget Repair Bill in February of 2011 came with his claim that it would save the state an estimated $30 million or more in that fiscal year and $300 million over the next two years.  The bill, however, would require additional contributions by state and local government workers to their healthcare plans and pensions, amounting to roughly an 8% decrease in the average government workers take home pay.  The bill also would have eliminated most government workers collective bargaining rights except for wages. Unions would be unable to seek pay increases for government workers above the rate of inflation unless approved by a voter referendum.  Under the bill, unions would have to win yearly votes to continue representing government workers and could no longer have dues automatically deducted from government workers paychecks.  Law enforcement personnel and firefighters would be exempt from the bargaining changes.

According to the Milwaukee Sentinel and The Wall Street Journal, all of this was necessary to avoid the layoffs of thousands of state employees, and its provisions should have surprised no one.  Union and Democratic leaders quickly criticized the bill as a power grab.  In a media interview one week later Walker said he was not trying to break the unions and noted that Wisconsin government employees would retain the protections guaranteed by the civil service laws.  He said that asking employees to pay half, just half, the national average for healthcare benefits was a modest request.  Even though leaders of two of the largest unions said publically they were willing to accept the financial concessions in the bill, but would not agree to the loss of collective bargaining rights, all 14 of the Democratic state senators departed the state and hid out in Illinois to deprive Walker of a quorum.

In the first half of 2011, Governor Walker raised more than $2.5 million for an upcoming recall election.  He raised $5.1 million in the second half of 2011 to battle the recall, about half of it from out of state, illustrating the national significance that both political parties see in this recall fight.  The Democrats and the unions have obtained more than a million signatures to put this on the ballot and hence, on June 5 the rubber hits the road, and the election will be held.  Polls vary on the likely outcome, and the outcome obviously depends on who will be the Democrats’ opposition candidate.  Could it be a rematch against the Mayor of Milwaukee, or could it be even a different candidate, lesser known but more strident.  Wisconsin is turning out to be a very important state because Democratic Senator Herb Kohl is retiring and his Senate seat is up for grabs.

The Walker recall, on top of the presidential election, is no mere exercise in payback.  As stated by online columnist Charles Lane,

For public‑sector unions, the Walker recall is no mere exercise in payback.  The unions, upon which Democrats depend heavily for funding and foot soldiers, say Walker must be ousted and his reforms reversed for the sake of the middle class.  Progressive values–even democracy itself–are in mortal danger.”  Actually, the opposite is true.  The threat to such progressive goals of majority rule, transparent government, a vibrant public sector and equality comes from public‑sector unionism.

Collective bargaining in the public sector is inherently contrary to majority rule.  It transfers basic public‑policy decisions, such as pay and working conditions that taxpayers will offer those who work for them, out of the public square and behind closed doors.  Wisconsin has always had a robust “open meetings” law covering a wide range of government gatherings, except collective bargaining with municipal or state employees.

Wisconsin is not the only state that faces this issue.  New York Mayor Michael Bloomberg complained about the so‑called “rubber room” where, until a couple of years ago, hundreds of union teachers languished, on full pay, while awaiting disciplinary hearings.  Hopefully it will dawn on Americans, not just Wisconsinites, even those who do not like Governor Walker’s policies, that it would be a disaster to cut short his term in office at the behest of a special interest group.  That would confirm Wisconsin’s public‑sector unions as the state’s de facto rulers.  The implications are, of course, substantial for any states in which public-sector unions (whose members now generally enjoy benefits far in excess of private sector workers) can negotiate behind closed doors for budget-busting benefits, the cost of which ultimately fall to the taxpayers. This has created an obvious limitation on the democracy we so enjoy.

Since the middle of the 20th century, organized labor in America has undergone two transformations with major implications for the nation’s politics. The first is the dramatic decline in overall union membership. In 1955, organized labor represented one-third of the non-agricultural work force; today, it represents just 12.3%. The second transformation, however, is even more significant: the change in the composition of the unionized work force.

As private-sector unions have withered, public-sector unions have grown dramatically. The Bureau of Labor Statistics reports that, in 2009, for the first time ever, more public-sector employees (7.9 million) than private-sector employees (7.4 million) belonged to unions. Today, unionized workers are more likely to be teachers, librarians, trash collectors, policemen, or firefighters than they are to be carpenters, electricians, plumbers, autoworkers, or coal miners.

Professor Stephen Bainbridge in the Journal of Law, Politics, and Culture stated:

A core problem with public sector unionism is that it creates a uniquely powerful interest group. In theory, bureaucrats are supposed to work for, and be accountable to, the elected representatives of the people. But suppose those bureaucrats organize into large, well-funded, powerful unions that can tip election results. With very few and very unique exceptions, no workplace in which the employees elect the supervisors functions well for long. Yet, research by Terry Moe (22 J.L. Econ. & Org. 1) into the electoral power of teachers’ unions finds just such an outcome:

The first study … provides evidence that teachers, acting through their unions, are quite successful at getting their favored candidates elected to local school boards. When a candidate is supported by the unions, her probability of winning increases dramatically, so much so that the impact of union support appears to be roughly the same as the impact of incumbency. In terms of total impact, union influence may be even greater than this suggests, because union victories literally produce incumbents—and the power of incumbency then works for union candidates to boost their probability of victory still further in future elections.

The second study … shows that public bureaucrats’ turnout advantage over other citizens is much greater than the existing literature would lead us to expect. It also offers persuasive new grounds for believing that their high turnout is indeed motivated by occupational self-interest—and more generally, that they are actively and purposely engaged in an electoral effort to control their own superiors.

Moe concludes:

The prevailing theories treat bureaucrats as mere subordinates, controlled from above by political authorities. But the control relationship can run both ways, and not just because bureaucrats have expertise and other sources of private information. In a democratic system the authorities are elected, and this gives bureaucrats an opportunity to exercise electoral power in determining who will occupy positions of authority and what choices they will make in office. It would be odd indeed if public bureaucrats and their unions did not invest in this kind of reverse control—and there is ample evidence that they do.

We appreciate that in any democracy elected officials must be responsive to those who vote for them if they are to remain in office. But that is a far cry from having elected officials negotiate (behind closed doors) wages, pensions and other benefits with those whose support they depend upon to stay in office.  In effect, public sector unionism thus means that representatives of the union will often be on both sides of the collective bargaining table. On the one side, the union leaders de jure. On the other side, the bought and paid for politicians. No wonder public sector union wages and benefits are breaking the back of state budgets. They are bargaining with themselves rather than with an arms’-length opponent.

Make no mistake about it, the Walker recall election, however its outcome, will tell us about the nature of the Democratic left.  More and more it whiffs of European Socialism than it does of a free enterprise system.

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3 responses to “Creeping Union Socialism – The Effort to Recall Wisconsin’s Governor”

  1. mark j levick says:

    The picture you painted is accurate and alarming. Candidate Walker ran on the platform that Governor Walker executed. The citizens of Wisconsin spoke and were rewarded with a balanced budget and a deficit was replaced with a revenue surplus. The public employees union did not find the foregoing to be fair to those hard working public servants whose bloated benefits were sinking the State. First they tried to recall enough State Senators to thwart the implementation of Governor Walker’s fiscal reforms. That failed so they used their union dues and manpower to fund a recall. If successful they will own the next Governor and will take control of the Democratic Party machinery and thereby be assured that only candidates beholding to them can win a primary contest. The rest of the taxpayers will then be required to fund the bloated contracts they negotiate with themselves and those who oppose them will dwindle knowing that victory is fleeting given that recall is both costly and enevitable. The fact that these unions are supported by large voting blocks with no “skin in the game” is not surprising in the world of class warfare and racial politics which has become the rallying cry of those charged with securing “four more years”. If those who think the Greeks and the French have got it right prevail the Argentinians may be crying for us as the dollar morphs into the peso and we become just another country in a World dominated by the Chinese. Perhaps that’s the change those folks believe in as it’s unfair that exceptional people succeed more often than those who find it better to take than to give.

  2. PHILIP L. GLASS says:

    One should take a look at the number of school districts in the state that went from a budget deficit to a surplus because of some of Walker’s changes in insurance coverage and pension benefits. The school districts are no longer required to buy coverage from only one agency but can now go into the market place to buy the same or better coverage at more competitive prices.

  3. Katherine Stewart says:

    I worked along side the unions in the construction industry for 10 years. It could take as many as three union workers just to install a refrigerator. This is based on the required union job regulations. A laborer to deliver and set in place , a plumber to install the water line and a wood worker in install the panel fronts of the refrigerator.

    The minimum union hourly wage is $75.00 and that is for a laborer who sweeps the floors. Amazingly enough recently in Chicago at a time when the construction industry was at it’s lowest in new construction the unions voted to go on strike. Sadly , the result was a salary increase.

    If the unions truly cared about their members a small decrease in hourly rates could allow for more employees to work. Construction rates would decrease, banks would approve more construction loans and more jobs would be created and more of their members would be earning an income.

    Seems like simple mathematics to me.

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