Economic impact of public employee unions

By Jim Tapscott

We are all aware of the several cities in California that have recently been forced to declare bankruptcy. Bankruptcy is usually due to a company or person allowing its obligations to exceed its abilities to pay them back. This is exactly what these cities and counties have done and this is just the beginning. There are several other cities in California that are also on the brink of insolvency. Meanwhile our governor is begging us for a tax increase to cover our “$16 billion shortfall.” Have you wondered what these governments have obligated themselves to that has caused this circumstance? In almost every case, it is their underfunded obligation to their employees’ retirement, medical benefits and salaries or all of the above.

How did this happen? The short explanation is the incestuous relationship that exists between the public service unions and the politicians who run our government. Is that term too strong for you? Following is my explanation of the relationship. You decide if it’s too strong.

We elect representatives at all levels of government, who are “hired” to be good stewards of the money we give them in the form of taxes and fees. These representatives are SUPPOSED to negotiate the contracts with these public service unions with OUR interest in mind. Why do I say, “Our interest?” Because the contracts they agree to, we, the taxpayers, are obligated to pay!

Where is the incest? The elected officials do the following. They agree to “defined benefits” (health and retirement), 100% paid by the particular government entity (taxpayers)—nothing from the employee! How many of you have that kind of “benefit?”? They set wages that are anywhere from 15% to 25% higher than the same wage for a comparable taxpayer’s job. The unions, from their dues, then donate large sums of money to the representative’s re-election campaigns, which negotiate their contracts. Do you see any conflict of interest here? If a private company did this, the stockholders would fire the administrators, and the government could possibly prosecute the managers for a crime. Has this happened?

I am going to throw one more can of gasoline on the fire. The reason the government entities are in trouble is that they have obligated “we the people” to these contracts, and then UNDERFUNDED them anywhere from 50% to 100% of the obligation. When the employees retire and the government has to start paying the obligations and still maintain the ongoing wages and benefits of the still working employees, the obligations exceed the income—hence insolvency. We are then threatened with loss of protection from fire and police and no funding for “our children.” Sound familiar?

This situation is going to become exponentially worse as more and more people retire and expect to receive what was promised. There are also the verified instances of some retirees who are receiving more in retirement than they received in wages. I don’t have enough space to list these. Most of you have read about or heard about them already.

There is one other aspect that you may not be aware of. These unions have become so entangled in our government that in some instances they, the unions, are telling the elected officials what to do. There are also instances of intimidation, threats and also bodily harm to those union workers who don’t want their dues to go to a particular candidate or to support a particular proposition. There is a proposition on the ballot in November that addresses that issue. Check out who is supporting the opposition—the unions!

I had a conversation with a single mother who was a member of a union and who had expressed a concern about what her dues were supporting to her union representative. He told her that he appreciated her concerns. Later she came up for a promotion, which would have moved her to a position out of the union jurisdiction. However, the “board” who vetted her for the promotion included the union rep she had expressed her concerns to. She received a positive recommendation from all on the board for the job—except the union rep. He voted against her and she therefore did not get the promotion.

This is an everyday occurrence in the union rank and file. There are dedicated teachers who don’t go along with the “union” position on numerous political issues and are ridiculed or hassled by the union representatives and some fellow employees. There are also a few thousand teachers, scattered across the country, who have been accused of less than commendable actions, that would have resulted in you or I being fired, but due to “tenure” are being paid, for an extended time, to sit in a designated room or stay at home for the 8 hours they would be normally be teaching.

I would further suggest that you Google the May Day celebrations in Los Angeles and Phoenix for the last two years and look at the pictures of the other organizations the public services unions are marching with. One of the groups is the American Communist Party. Several SEIU members (purple shirts) are carrying some of their signs. Read those signs and their goals. Remember the origin of “May Day” celebrations. Do they reflect your values and goals?

One caveat: I am not trashing ALL public service union workers, most of whom are fine hardworking people. I am, however, addressing the broken system and the effect it will, and is, having on all of us now and in the future.

Want to learn some more? Come to the Ramona Tea’d forum at Ramona Mainstage on Aug. 25 beginning at noon. The public service unions are the subject.

We will have two qualified speakers, District 77 California Assemblyman Brian Jones and Brian Calle of the Pacific Research Institute. The doors will open at 11 a.m.