In the private sector there are market restraints on what a union can demand. If UPS (union) workers demand too much in compensation as to render their company non-competitive with FedEx (non-union), they will lose business. This puts a real world restraint on what these unions demand in terms of compensation and benefits. Corporations can go out of business, which obviously would hurt the union employees. Government has no competition, and is in effect a monopoly in terms of the services that it supplies. Therefore, there is no similar control placed upon public sector union demands. If government workers go on strike, where else can consumers go to get their drivers licenses? There is no market mechanism to keep the price of labor in line.
With the lack of market forces, taxpayers must rely exclusively upon management to say no to costly demands. Management in this case of the current issue in Wisconsin is the Governor, but the scenario is no different throughout other levels of government. County Executives, Mayors, & Town Councils all act as management in the government “corporation”. The government official must work even harder to represent the taxpayer in negotiations with public employee unions under these circumstances. There is a political party, however, that is beholden to the very government unions they are supposed to be negotiating with.
The Democratic Party receives an overwhelming amount of money in political donations from public sector unions, in fact their top 4 donors are various government unions (http://www.opensecrets.org/overview/topcontribs.php).
Many candidates go to union sponsored events, and pledge their support. This would not be a problem if not for the fact that the elected official in question will be sitting across the negotiating table from the very union that supported them in their campaign. If a candidate for office received a donation from a corporation, then after elected gave a no bid contract to that corporation it would be called corruption. How is this situation any different?
Considering most government entities (other than federal) must balance their budgets every year, you would think that politicians would be restricted from offering paybacks to the unions. They can’t give what they don’t have. Right? The problem with this argument is that the official has the ability to promise, and get passed into law, retirement and health benefits that will be paid for in the future. This takes away any current budgetary restraint that may exist, and puts us in the situation we find ourselves today in Wisconsin and all across the nation.
Mr. Walker’s proposal specifically eliminates collective bargaining for pension and healthcare benefits. This addresses the problem of politicians overpromising future benefits for unions that helped elect them. Any progress made in Wisconsin or other states, however, may be short lived if the screamers get to rule the debate. It would not be surprising if unions spend even more than the current record amounts in the next election in order to drown out rational discussion.
http://freemarketsfreepeople.net/?p=363
Re post 18:
Excellent summary of the perverse incentives and feedbacks between unionized government workers, their elected “bosses”,
and the political parties!
Book mark (great summery)
That is the case until the government comes in, with tax payer money, and bails the union employer out.