The recent strife in Wisconsin and other states has prompted several thoughts:
1. Public employee unions have been very successful, in large part for two reasons: first, the jobs they represent are less susceptible to export to lower cost areas of the world and, second, unlike private sector unions, public sector unions can directly influence the officials who employ their members by providing campaign financing and “volunteer” help. The first advantage may not be as great as thought. Most public sector jobs could be done by private contractors at lower cost, and public sector employers are starting to outsource jobs. The second advantage seems to me what the proposed legislation in Wisconsin is attempting to address, and I do not think that neutralizing this atypical advantage is necessarily either a bad thing or something that will cripple organized labor.
2. A civil service that is grossly underpaid creates a real danger of corruption. One need only look at the New Orleans police department, whose members have historically been grossly underpaid, to see how such a situation leads to bribe taking and other forms of misconduct. In addition, government loses its moral authority if it exploits its workers.
3. On the other hand, the public will not support a civil service it perceives as having a much better deal than itself, particularly in hard economic times, when one hears members of the public express resentment that they are in danger of losing their homes to support teachers and other civil servants they perceive as under worked and over paid.
4. Unions, perceiving this resentment, propose that the “rich” need to pay “their fair share.” I believe everyone should pay his or her “fair share,” preferably via a graduated tax system that does extract a higher percentage of gross income from the better off. However, one who does not pay for government has no stake in government, and will not be a civic watchdog, via the ballot box or otherwise. And one of whom too much is asked may vote with her or his feet, especially when the excess extraction is on the state or local level. The recent loss of congressional seats in the northeast is ample evidence that people – often those with money to invest in enterprises that will create good new jobs – who feel they are being asked to pay too much will eventually reach a breaking point and just leave.
5. Unlike private business, which has to focus on the bottom line, government employers don’t lose anything (and may well gain political support) when they give in to union demands when the money is there. It is only in times like now, when the money isn’t there, that overly generous pay and benefits become a problem, and it then is too late to “put the toothpaste back in the tube” without encountering strong organized resistance. If these leaders had exercised a little restraint when times were good, and engaged in adversarial negotiation with the public employee unions, rather than capitulating to their demands, the states and localities would not be in the position they are now.
6. As I mentioned in an earlier post, another problem in government is the managerial and professional employees, often not represented, who frequently do worse than their private-sector counterparts, as well as their represented subordinates. Unlike the private sector, where upper management often is grossly over compensated, regardless of results, in the public sector upper management is usually (unless they are school superintendents) under compensated, even when the supposed “lifestyle” and other benefits of working in the public sector are factored in. Especially after the economy improves, it will be very difficult to fill management and professional positions in government with the quality personnel needed unless something is done to make the pay more competitive for this class of employment.