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Saturday, February 19, 2011

Hey Gov. Walker! This Union Man is Right Behind You.

As a Union Officer for a local in the Laborers' International Union of North America, the events in Wisconsin have me very concerned.  But contrary to what you might think, I am not on the side of the public unions.  In fact, I believe what is happening now will ultimately hurt not only the public unions, but also the private sector unions.  If my fellow brothers in the private sector wish to preserve our unions, we should support Wisconsin’s governor Scott Walker.  Unfortunately, our union leadership has lost sight of the issues and is instead focused on the money.  It’s not hard to see why.  While union membership has been on a steady decline in the private sector, the public unions and their membership will continue to rise without end until our governments are bankrupt and the voters take their revenge on the unions.  The union coffers will overflow and empower new drives to organize the private sector.  But in their search for relevancy, the unions have pushed themselves to the brink of extinction.

Labor unions have existed primarily to balance the rights of the business owner with the rights of the individual workers.  Apart, each individual worker holds very little leverage in dealing with ownership.  But collectively, a group of workers possess a great deal more.  Just as the business owner’s first duty is to achieve profit, the workers seek to be compensated properly and treated well for their efforts.  This creates a synergetic relationship between employer/employee.  When the workers are productive, the business will prosper.  As the business prospers, the workers will be rewarded for their productivity.  If the workers’ productivity declines, the business will falter and this will lead to a loss of pay and jobs for the workers.  Production=Profit=Compensation=Jobs

There are three elements that are fundamental for a healthy union-management relationship:
  1. Power Balance
  2. Profit Motive
  3. Moral Hazards

But what happens if workers are allowed to collectively bargain in the absence of these necessary elements?

In the private sector, the union-employer relationship will tend toward balance.  When it does not, whatever the reason, the business can suffer in the marketplace.  Often businesses falter if the workers’ unions amass too much leverage.  Airlines have gone bankrupt, auto manufacturers have defaulted requiring government bailouts and countless smaller businesses have shut their doors under the weight of poorly negotiated contracts.

The public sector unions on the other hand, have a very different relationship with management.  This is first and foremost because the employers are elected officials who ultimately must answer to the voters, among which will be their workers.  As a collective, the union forms a voting bloc which creates the opportunity for illegitimate, though not illegal, quid pro quo activity.  The union can offer tangible benefits (campaign funds and votes) to elected officials  at little or no cost to the individual workers and the elected official can offer tangible benefits (compensation and work rules) to the workers at little or no cost to the official.

Because a profit motive is absent, worker productivity and job security now flow inversely. If worker productivity should lag, it has no perceived negative effect on the state’s vitality.  Far from adversely affecting the job security of the current workers, it has the added benefit of increasing their security as more workers are needed to maintain production levels.  As their numbers increase, this organized voting bloc will often supersede the rightful owners (taxpayers) at the bargaining table. 
Productivity=Jobs-1    UnionCompensation=CampaignFunds    Profits=0

In the private sector, the unions work with management to increase worker productivity in order to achieve a higher profit for ownership which ultimately benefits both sides.  In contrast, the public sector unions and elected officials seek to enrich and perpetuate the other side at the expense of the actual owners (taxpayers).  The public sector workers, so far removed from the mechanisms of the market, have ceased to be a true labor union and are simply just one more aggrieved group seeking favors from our elected officials.  As a political action committee they are welcome to lobby their cause, but teachers on strike have forfeited the right to call their work a sacrifice.

We are fast approaching the day of reckoning with the public unions.  The current system, which will soon bankrupt our states and local governments, must end before it’s too late.  It is my hope that what has begun in Wisconsin will have a far reaching effect on our nation.  I call on the leadership of private sector unions to stand with the taxpayers.  If we don’t, I’m afraid the resultant wave of anti-unionism will wipe us out as well.


  1. I respectfully disagree with your opinion. As a state employee for almost 13 years and under both Republican and Democratic governors, I have taken hits in salary and benefits during the lean years only to never see them returned in the good years unlike what happens in private sectors where raises are generally determined by the fluctuation of the company's or economy's success.
    I have been furloughed 10 days and made to work 10 days out of the past 2 years for no pay because I am designated as "emergency essential personnel" and required to report whether the rest of the state is working or not. And let's not even talk about what year it was the last time I got a COLA let alone an actual raise.
    I make about half of what I would make doing a similar job in the private sector and while our benefits are ok and I am certainly glad to have them, they are nothing to write home about. I do my job because it's something I believe in but regardless of what my thoughts are about my job, the bottom line is I perform a service for the state and I deserve to be paid in a fair manner for it. Everyone who lives in this state benefits from what I do and what most state employees do and everyone has to pay for services no matter whether they come from the government or some company.
    My husband is a high school administrator who routinely puts in 10-12 hour days and an additional 2-4 nights a week covering nighttime events. If he were paid and hourly wage he would not be making minimum wage yet he still sacrifices time away from his family to do a job he feels called to do. Our state is currently trying to decide what to do with school employees pensions as well. It is a complete dis-service to all the people who work so hard to be positive influences on kids' lives to not support them so they can know that when their job is done, they will be able survive on their pensions even when they are not drawing in those 6 figure salaries like a lot of the corporate world.
    I have never been a member of a union and never felt like it was necessary but more and more as I sit back and watch helplessly as I am required to do more and more with fewer and fewer resources and less pay. Yes at some point the government has to cut their spending but there are other things that need to change before taking away their worker's voice and benefits.

  2. You did not mention in which state you or your husband work, so I can't speak specifically to your situation. But I can say according to the available data, you are the exception. Pay and benefits as well as overall employment have increased in for public workers while falling in the private-sector over the past several years.

    But, your and your husband's situation sounds an awful lot like the salaried workers at our facility. As exempt employees, they have no rights to collectively bargain, yet I don't remember a sick-out taking place when ownership froze their salaries and altered medical benefits last year. Where was the press then?

  3. It's Lela, Sam. We live and work in Maryland. The past 3 years have seen furlough days, reduced salaries, increased medical and pension contributions from employees, and for the rest--layoffs in the state system. Would you like to see my W-2s? For the past 7 years, I have made less than the previous year. At this rate, in another 4 years I will be back at my starting salary of a whopping $29,750 from 1998.
    When I started here 13 years ago, we had about 220 employees, There are now about 110 people here. I can't speak for all states, but Maryland has cut its workforce. There has been a hiring freeze across the state for all but about about 3 years that I've worked here.
    A lot of people perceive state employees kind of like they do pastors. They are supposed to provide for their flock, do all these great things, be available 24/7, and work for mere shoes on their feet and food on their table--and it better not be steak more than once a month! State employees are civil servants. We are here to serve the people of our state. Some of us (myself included) work nights, weekends, holidays, and snow days. I don't get any extra pay for working Christmas or any other holiday. I make the same amount of money as everyone else does that day--those who are sitting around eating Christmas ham with their families. The only difference is that I get to be off December 28th instead of December 25th. That's GREAT! There are not many private sector jobs that don't provide some sort of holiday pay.
    As for your situation, I suppose if your exempt employees wanted attention drawn to their plight, they needed to pick up a phone and alert the press. Coverage doesn't just happen. Something has to draw it there.
    I agree that changes need to be made. But state jobs are not the cushy things that they used to be (and even that was really before my time) and state employees should not be the villified people that some make them out to be. They are doing a job like everyone else, and like everyone else, they are doing it for less than they used to.

  4. Lela, thanks for commenting.

    I understand your situation. My pay decreased over 20% during the past 3 years and my wife lost her job. The size of our company has shrunk from over 700 employess to about 400. We have received our own furloughs - over Christmas and new years along with layoffs and benefit sharing increases. That's what life is like all over the place. Yet I'm not angry at my boss, we're not protesting in the streets.

    Nothing I've said is to disparage any government workers for the job they do, but collective bargaining doesn't belong in public service.

    The cuts are happening because what existed is unsustainable. Ron George of the Baltimore Sun wrote,"According to the Maryland's Comprehensive Annual Financial Report, our pension liability for government retirees is over $17.5 billion....In addition, unfunded state retiree health benefits total more than $15 billion....The state's budget has grown by over $4 billion during the economic downturn." http://articles.baltimoresun.com/2010-09-14/news/bs-ed-maryland-government-spending-20100914_1_public-sector-private-sector-state-workers

    The best solution is not an attempt by unions to protect what they have, but to seek new solutions. Open up government to privatization where posssible - education, utilities, roadwork and even public television. New efficiencies by privatization can provide an increased standard of living for today's public workers. Just as my company must innovate and move on, so must they. Unfortunately, they are fighting the wrong battle.

    Again, good to hear from you Lela. Hope motherhood is treating you well. So adorable...

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