JONATHAN CHAIT FEBRUARY 28, 2011
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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.
9 comments
Kevin Williamson's comments are risible.
- liberalref
February 28, 2011 at 3:25pm
Oh, but if the Wisconsin Governor is going to emasculate the Unions, he MUST first pretend that they're all powerful. Why would he have to emasculate them otherwise? That they're making all kinds of concessions at this point (except to let go of collective bargaining) would make you think they're not as powerful as he's pretending. That he successfully passed tax cuts for corporations BEFORE demanding these concessions from the unions also implies their power is pretty limited.
- AllanL5
February 28, 2011 at 4:02pm
When I think of public service announcements that explain the good of a public union I am reminded of the following video. Although it's not the "real" version, it should be. Maybe if people were reminded of what many public sector folks do at lower-than-private sector pay and working in not-so-enviable working environments (think sewer & water) people might have a reason for voicing pushback on the GOP gutting of unions and public unions at that. http://www.youtube.com/watch?v=_3mw49mk_x0
- singlspeed
February 28, 2011 at 5:37pm
In a previous life, I negotiated (as management) with several AFSCME locals as part of a large County government. Two elements about these contracts aren't getting enough notice. The first is how these contracts were frequently structured. In order to look responsible while still buying labor goodwill, it was common for us to structure contracts so the benefits were deferred until the next guy's terms, so we could balance the budget while sticking the next Executive with much higher costs (for example, we would agree to "catch-up" provisions or increases in COLAs in later years). Once these increases were granted, however, they were unerodable. The existing contract--usually with automatic increases built in--was the starting point of the next round of negotiation, so the worst case for the union was status quo. The second was a preference to defer compensation to increase retirement benefits, which actually gave the Executive greater flexibility in the short run, as it was easy to under-fund retirement contributions with a promise to catch up. This also makes government jobs less attractive for younger workers, as those retirement benefits aren't portable like a 457 plan.
- svenzke
February 28, 2011 at 5:47pm
The costs of business lobbying are (by design) hidden, as they usually come in the form of tax exemption. The cost of all the corporate tax exemptions in the typical state tax code would boggle the mind. For instance, Washington State is mostly a sales tax state (the modest state property tax is dedicated to public schools, and there is no state income tax). And guess what is exempt from the state sales tax? Lo and behold, the sales of "digital goods" to businesses (thanks, Microsoft!), airplanes (thanks, Boeing!), newspapers (hmm, wonder why there aren't any editorials opposing this one), etc., etc.
- kkseattle
February 28, 2011 at 7:16pm
Most of the discussion to date has focussed on the role played by unions both in negotiating for wages, benefits and working conditions, and in using both money and manpower to support candidates favorable to their agenda. However, unions are far more than a 'countervailing force' to corporate power. They have frequently been at the forefront in advocating for progressive social policies (think of Walter Reuther's role in advancing civil rights), which in my mind speaks to their value to the broader society, but in the mind of a conservative no doubt represents one more reason to crush them. Their role in making the case for a better society for all is one more reason that they merit support in this struggle.
- sstrom
February 28, 2011 at 7:46pm
The Unions do have exceptional strength and it is deomostrated in a few non-traditional measurements that Mr. Chait is not picking up. My children's school, where I went to school 30 years ago provides a fine demonstration. Nurses were outsourced about 25 years ago and when children get sick or hurt are shuffled off to a doctor's office. Eliminating nurses solved a few budget issues 25 years ago. The local lawn service and snow removal was outsourced about 20 year ago to meet the budget requirements. The hot lunches delivered by the Lunch Ladies was sold off and outsourced to ARA to allow the schools to eliminate the overhead and employee commitments about 15 years ago. The Preschool program was spun off as a collective about 10 years ago so that the school district would not be on the hook for obligations to the Pre-School Teachers. Bus Drivers were cut loose a few years ago and the school district dropped busing for all students to save a few dollars and help balance the budget. Last year the Custodians were outsorced and cut by half. Custodians could apply for their 'Old Jobs' at about half their old pay and benefits. In the last 30 years the Teachers have continued their raises and benefits to the poiint that 'Instruction Costs' for a typical 25 student class room are over $ 100,000 per year. The Teachers were sad when the Nurses left. The Teachers were sad when the Maintence Men left. The Teachers were sad when the Lunch Ladies moved to ARA. The Teachers were sad when the Bus Drivers were fired. The Teachers were sad when the Custodians lost their jobs. But what did the Teachers do about all these other people losing their jobs? Nothing. I'd like to have a job where all the support people get fired before my wages and benefits are touched.
- CRS9TNR
February 28, 2011 at 8:15pm
WISCONSIN, THIS IS WHAT DEMOCRACY LOOKS LIKE http://www.huffingtonpost.com/harvey-j-kaye/report-from-madison-wisco_b_828668.html
- hkaye
February 28, 2011 at 9:48pm
This Governor, in Wisconsin, is a shanda.
- Sophia
March 1, 2011 at 6:49pm