JONATHAN CHAIT FEBRUARY 28, 2011
The Battle of Wisconsin has created a meta-debate over political economy. Liberals argue that public unions, though often advancing bad public policies, help offset corporate power. Conservatives, by contrast, view public unions as operating within their own sphere, in which they reign all powerful. National Review's Kevin Williamson heps scorn on liberals who see public unions as working in opposition to business interests:
The big money and the unions already are on the same side: The unions are the big money; theyare the oligarchy. Being familiar with the financial role that such organizations as the SEIU, AFSCME, and the NEA played in the election of President Obama and scores of Democratic senators and representatives, Professor Krugman probably knows that he (or his wife) is writing things that are not strictly speaking true, but that is what the New York Times apparently pays him (or his wife) to do. Equally ridiculous, in this light, is Jonathan Chait’s parroting of Krugman, with the claim that “in the real world, politics is dominated by the influence of the rich and the business lobby, with unions providing a small countervailing force.”
The facts suggest that the force is neither small nor countervailing, but large and prevailing. At the state and local levels, unions run the show. They run it financially, and run it by turning out at the polls.
Obviously, unions exert a large influence in absolute terms. But relative to business, labor is indeed a tiny force. In the last election cycle, business groups out-spent labor on both lobbying and electioneering by more than a 3-to-1 ratio.
Now, public unions have the strongest (but by no means sole) interest in their own compensation. It's true that you don't have businesses sitting across from the bargaining table with the public unions. But that doesn't mean those unions lack an opposing force. Paying public employees more requires raising taxes. The cost of taxes is apparent and immediate for voters. The cost of a less effective public workforce plays out over long time horizons and is harder to demonstrate. Of course, the convergence between these two lines is often deferred compensation, which makes for bad public policy. But I don't assume that low wages without high pension benefits is the answer, either.
What's more, recent years have seen the rise of well-financed groups working in opposition to public unions. Kenneth Vogel reports:
The conservative assault on public sector unions that seemed to explode out of nowhere in Wisconsin and spread across the Midwest was in fact months – if not years – in the making, the result of methodical polling, lobbying, messaging, grassroots organizing and policy crafting by a coterie of well-funded conservative groups.
“We go back a long way on this in Wisconsin, and in other states, as well,” said Tim Phillips, president of Americans for Prosperity, which for years has been urging its members to push their elected officials to reduce government salaries and benefits, and which has spent more than $340,000 on television and radio ads supporting the push by Wisconsin Gov. Scott Walker’s effort to strip union bargaining rights from state employees. ...
The groups – which collectively have received tens of millions of dollars in funding from some of the biggest conservative donors in the country, including the Koch brothers, the DonorsTrust funds and the Milwaukee-based Bradley Foundation (whose president chaired Walker’s campaign) – have considered the issue a top priority for the last few years. They’ve been churning out research warning of impending fiscal disaster if governors and lawmakers in their states didn’t reign in spending by slashing their governments’ payrolls, workers’ benefits and pension liabilities, and – in some cases – have produced legislative proposals that are now at the center of debate.
Second, it's obvious on its face that public unions aren't uniquely influential. The most influential lobbies are those who manage to make their cause noncontroversial. The National Rifle Association, the Israel lobby, farm lobby, and many others -- these are groups who enjoy broad bipartisan support. The unions are acceding to painful cuts in many states, and facing an existential threat in Wisconsin. That never happens to the really powerful lobbies. If your agenda's success depends upon one party having power, then by definition you do not reside in the top stratum of powerful lobbies.
Again, the above points are limited to the narrow question of public employee benefits, and the whole liberal argument focuses attention on the fact that public unions impact issues far beyond their narrow self-interest. On the question of public employee compensation, public unions are the most powerful lobby, but neither sovereign nor unopposed. On the broader issues on which unions engage -- and that was the context in which i was writing -- they are a small, countervailing force against business power.