Should public employees have the right to collective bargaining over pay, benefits and pensions?

To follow is an excerpt from the CQ Researcher report "Public-Employee Unions" by Kenneth Jost on April 8, 2011.

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Indiana Gov. Mitch Daniels marked his first full day in office on Jan. 11, 2005, by rescinding collective bargaining rights for the state's 25,000 employees. The Republican governor's move reversed a policy that three Democratic predecessors had followed under executive orders for the previous 15 years.

Daniels depicted the action then as needed to restructure the state's child-welfare bureau. Six years later, the potential GOP presidential contender sees a broader purpose in curbing public-sector unions. “Public jobs grew while private jobs were lost, public salaries went up while private sector salaries are shrinking,” Daniels told a Republican fundraiser in Cincinnati Feb. 23, referring to the era since widespread recognition of collective bargaining for public-employee unions. “It's time to interrupt that loop in the public interest,” Daniels said. [Footnote 8]

Daniels' comments came as his fellow Republican governors in Wisconsin and Ohio were urging GOP-controlled legislatures to approve new restrictions on public-employee unions in their states. In those states, as in Indiana earlier, unions and their allies say the moves eliminate important worker rights, while supporters say restrictions on unions are needed to cut costs and make government more efficient.

“Public employees should have the same bargaining rights as every other employee in society,” says AFSCME collective bargaining director Kreisberg. “If they want to work together in the bargaining process, they should have the same right as any other worker in America.”

“I don't believe they're rights,” counters Matt Seaholm, director of the Wisconsin chapter of Americans for Prosperity, a low-tax advocacy group that has supported Walker's legislation. “It's a privilege for public-sector unions to have collective bargaining ability with government and, frankly, with the taxpayers. That privilege has been abused.”

In the past, union rights for public employees were seen by opponents as an infringement of government sovereignty. That argument is rarely heard today. Instead, critics of public-employee unions argue that the unions' combined economic and political clout results in overly favorable deals for public workers when bargaining with government officials and managers.

“The trouble with collective bargaining for public employees is there's no one with skin in the game on the other side of the table,” says Chris Chocola, a former two-term Republican congressman from Indiana and now president of the Club for Growth, another low-tax advocacy group. “The people agreeing on one side bear no consequence.”

Collective bargaining for public employees “results in pay that you could not get in an arms-length negotiation,” says Stephen Bainbridge, a professor at UCLA Law School and a former senior fellow at the Heritage Foundation, a conservative think tank in Washington. “It gets you the kind of gross pension benefits that you see around the country.”

Pro-labor experts scoff at the picture of unions overpowering complacent government officials and managers. “Tired arguments,” says North Carolina State's Kearney. “There are constraints on public employees,” he continues. “When the public perception is that the unions have been too successful and have generated wages, benefits and working conditions that are out of step with those in the private sector, then there can be a reaction.”

“The problem is not that the unions exist,” says Henry Farber, a professor of economics in the industrial relations section at Princeton University in Princeton, N.J. “The problem is inadequate discipline on the government's side. The solution is not to kill the union.”

Kreisberg similarly rejects the argument that government managers are more willing to grant union demands than private companies. “It's easier to make a profit than to raise a tax,” he says. He also notes that in many states pensions are set by legislatures, not through collective bargaining. “That's the biggest myth out there right now,” he says. “That unions have somehow negotiated fat pensions.”

Defending the Wisconsin legislation, Seaholm initially says that it leaves bargaining over wages “intact” and only eliminates negotiations over pensions and benefits. Under questioning, however, he acknowledges that the bill allows bargaining over wages only for raises up to the cost-of-living increase. With that provision, the bill “basically abolishes collective bargaining,” Kreisberg retorts. “Let's not mince words.”

Walker and other critics are tapping into a sentiment widely shared by the public at large — that public-employee unions have gotten the upper hand. “In some states, the relationship [between state government and public-employee unions] is slightly out of whack,” says DiSalvo of the City College of New York. To correct the imbalance, DiSalvo favors either restricting collective bargaining rights or limiting unions' political influence. “If one could restrict one or the other, it could bring things back into equilibrium,” he says.

But Thomas Kochan, a professor of management and director of the Institute for Work and Employment Research at the Massachusetts Institute of Technology's Sloan School of Management in Cambridge, says restricting collective bargaining is not the solution. “The beauty of collective bargaining is standards,” he says. “That doesn't eliminate politics, but there are standards. To go back to the law of the jungle and pure politics is very, very shortsighted.”

The Issues

* Should public employees have the right to collective bargaining over pay, benefits and pensions?
* Are public employees, in general, overpaid, underpaid or fairly paid?
* Do public-employee unions wield undue political influence?

Click here for more information on the CQ Researcher report on "Public-Employee Unions" [subscription required] or purchase the PDF.

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Footnotes

[8] Quoted in Sharon Coolidge, “Daniels: Ohio can follow Indiana's lead,” The Cincinnati Enquirer, Feb. 24, 2011. For the 2005 action, see Kevin Corcoran and Mary Beth Schneider, “Daniels ends union pacts for 25,000,” The Indianapolis Star, Jan. 12, 2005, p. A1.