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Collective Bargaining and Public Employee Unions


In light of all the recent discussions about collective bargaining and public employee unions, I would like to spend a little time discussing the affects of collective bargaining, and explaining why collective bargaining by public sector labor unions is not a good idea.

Collective bargaining is simply the process by which an appointed entity (usually a labor union, represented by a handful of officials chosen by its members) negotiates worker compensation with an employer. The entity negotiates on behalf of the entire group of workers that it represents, and each represented worker receives equal pay and benefits (or an agreed-upon variable pay scale based on merit, tenure, etc.) under the agreement. Usually this is done on a contractual basis, where contracts are in force for a certain amount of time and must be re-negotiated when they expire.

When unions are allowed to collectively bargain with employers, the resulting contracts generally guarantee that workers are receiving a fair share of the income generated by the company. Overall this is not a bad thing. Satisfied workers are more productive and more willing to assist the company in efforts to become more profitable. And when similar union contracts are signed among competitors, these contracts prevent one company from "cherry-picking" the labor force of its competitors by offering disproportionate compensation. Labor contracts also help employers by providing a fixed cost for labor, thus allowing companies to plan better financially.

Yet collective bargaining also has serious drawbacks. First and foremost, it gives unions the power to resist cutbacks and other austerity measures, even when such measures are crucial for the financial well-being of the company. During the 1950's the 'Big 3' automakers signed labor contracts with the UAW that were the envy of America: generous wages, retirement benefits, health care, protection from lost income due to strikes, accident insurance, extended vacation and sick leave time, annual cost of living raises, and so on. At that time, the 'Big 3' owned 95% of the domestic automobile market share. Detroit was literally awash in a sea of money, and could easily afford that level of employee compensation.

But the good times didn't last forever. When the price of oil spiked in the early 1970's and the US economy soured, Detroit automakers found themselves in dire financial straits. Certainly they tbore a great deal of the responsibility for their predicament - they failed to listen to their customers and virtually ignored potential competition from foreign car companies, and they created their own insulated internal bureaucracy that rewarded company loyalty over merit or performance.

Yet when GM attempted to introduce austerity measures and restructure operations at its massive new Lordstown, Ohio assembly plant in the early 1970's, workers viscously revolted, staging wildcat strikes, taking unscheduled leaves of absence, ignoring build quality on the assembly line, and in some cases deliberately sabotaging cars. Discipline was lax because the United Auto Workers protected assembly line workers from retribution or dismissal by GM. This episode effectively ruined the Chevy Vega and cost GM over $150 million in production losses. The attitude of the Lordstown UAW members toward GM is known today as "Lordstown Syndrome."

Although the misbehavior ended, the Lordsdown attitude continued among UAW leaders and members, who continually pushed automakers for bigger and more generous compensation packages. Only within the last two years, as GM and Chrysler collapsed and had to be bailed out by the government, and Ford Motor Company suffered a nearly fatal financial code blue, has the UAW finally allowed car companies to make significant reductions in employee compensation. (But at the same time, the UAW received a generous number of shares of "New GM" and Chrysler/Fiat stock; also, their investments in the old company pension funds were made whole by the government, and they negotiated a generous "profit sharing" plan for employees with the new car companies - UAW workers at the Big 3 are already slated to receive their first checks based on 2010 company performances.)

Taking all of this into consideration, we need to ask a tough question: how will the history of union resistance to austerity measures affect public employee unions, whose workers are employed by the government, and whose compensation is funded by our tax dollars?

A privately owned company with unionized labor is governed through cooperation between its management, its shareholders, and labor representatives. This cooperation provides a system of checks and balances against abuse by one or more of these entities. Company finances are bound on the lower end by profit (which the company must earn in order to survive) and on the upper end by competition (which keeps the price of its goods or services within the range that consumers are willing to pay).

But this system does not exist in the public sector. Public sector employees are paid through tax dollars, the collection of which is compulsory, not through voluntary sales of goods or services. There is no "competition" to control pricing or offer alternatives to government-provided services. And, as public sector unions have long ago discovered, it is very easy for unions to control elections by marshaling votes and providing campaign contributions to favored candidates; those politicians then return those favors by endorsing government policies that favor unions.

With this in mind, can public sector unions be trusted to ensure the best interests of their members, and of John Q. Taxpayer, who finances their members' compensation (and by default, the operation of the union, which is supported by dues paid out of its members' taxpayer-financed compensation)?

Currently, all 50 states are facing serious budget crises. State employee pension funds currently have a combined funding shortfall of $1 trillion. States face billion-dollar budget deficits due to recession-induced losses in tax revenue, and the continuing fragile state of our economy makes major tax hikes all but out of the question. Some state officials have quietly began discussing ways to create a legal mechanism that would allow states and large municipalities to declare bankruptcy.

Yet just as their UAW brethren did thirty five years ago when faced with the prospect of cutbacks in compensation from the Big 3 automakers, public sector union leaders are actively resisting any attempt to limit their members' compensation, or union collective bargaining power. Before General Motors was reorganized, over $1500 of the sticker price of each automobile that it sold went to pay for employee and retiree health insurance costs; these "legacy costs" were a major contributing factor to the eventual insolvency of the company. We simply cannot allow our state and local governments to be pushed into a similar corner through union contracts.

It's also unrealistic to argue that the Federal government can fix the problem through bailouts or stimulus money. A significant portion of the money in President Obama's stimulus bill was apportioned to the States, specifically to finance public sector jobs that might have been threatened due to revenue shortfalls. In Texas, for example, 78% of the $25 billion given to the state in Federal stimulus money has already been spent, and 7 out of 10 stimulus jobs "created or saved" in Texas were in public education. There is currently no plan for funding those jobs once the Federal stimulus money runs out.

And in New Jersey, former governor Jon Corzine spent an entire $1 billion one-time Federal aid package for public education in one year - coincidentally an election year, which also turned out to be his final year as governor. The resulting hole in the following year's budget precipitated the highly publicized standoff between current governor Chris Christie and the New Jersey teacher's unions. The unions refused to accept a pay freeze for their members, and districts around the state were forced to lay off hundreds of teachers.

Another question we must ask is, can we tolerate "Lordstown syndrome" among public employees? Admittedly, police and firefighters have a strong ethical commitment to their work, but the dereliction of duty by New Orleans police officers at least illustrates that these ethics are not universal. And what about the recent episodes in Wisconsin, where doctors openly handed out false notes to teachers so that the teachers would not be in violation of the "no unscheduled leaves of absence" clause in their contracts? All we can say for sure is that some Wisconsin teachers have no qualms about flagrant dishonesty, if it results in the preservation of their jobs and their union contract. That's not exactly something to be proud of.

Few of us have any "beef" with teachers, firemen, policemen, employees of state agencies, or any other public servants. We do not wish to see them "trampled", nor is it realistic to assume that a loss of collective bargaining power would return public service employment conditions to the era of the Great Depression - there are already enough Federal and State laws governing workplace safety, job training, mandatory compensation requirements, etc. to preserve virtually all of the rights that public employees currently enjoy under collective bargaining agreements.

But we can ill afford a system of union representation that historically has ignored the financial plight of businesses until time has literally run out and, with respect to public employee unions, has created for itself a system of bought-and-paid-for politicians beholden to the special interests of labor unions and not to the general interest of taxpayers. It's time to loosen the grip of public employee unions on the public purse strings, before we dig ourselves into a financial hole that we cannot climb out of.


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Comments (30)

<a href="http://ww... (Below threshold)
Neo:
And understand this: If American workers are being denied their right to organize and collectively bargain when I’m in the White House, I will put on a comfortable pair of shoes myself, I’ll will walk on that picket line with you as President of the United States of America. Because workers deserve to know that somebody is standing in their corner.
AWOL
<a href="http://www.opensec... (Below threshold)
William:

http://www.opensecrets.org/orgs/list.php?type=A

They are using union dues to fund the opponents of the ~40% of their members that are 'conservative'.

Lobbying and corporate contributions pale in comparison. It's got to stop.

There is more to this than ... (Below threshold)
GarandFan:

There is more to this than just the unions. It's the very survival of the Democratic cash cow.

One thing to ponder regardi... (Below threshold)
James H:

One thing to ponder regarding austerity measures and employees: Is the pain being shared equally?

In the past couple years, the media company Gannett has experienced a severe reduction in advertising revenues. Gannett responded, understandably, with such steps as freezing pay, laying off saffers at its media properties and furloughing its existing employees to save money.

Meanwhile, Gannett employees have seen the company's executives continue to receive substantial pay and bonuses, though the 2010 numbers aren't out yet.

Contrast this with Southwest Airlines. There, the airline hit hard times and its workers (IIRC) took cuts to pay. But in 2009, the CEO also took a pay cut, knocking 10 percent off his compensation voluntarily.

The difference between these two cases is a matter of good management. One company balances its books on employees' backs and rewards its top executives for doing so, while at another company, employees who consent to austerity measures know that the CEO taking a cut alongside them.

And did I mention Southwest is a heavily unionized airline?

The difference is not the unions, but rather good management and attention to workplace morale.

I know that the workers wer... (Below threshold)
iwogisdead:

I know that the workers were all oily from building cars, but I don't think that they "viscously" revolted.

http://en.wiktionary.org/wiki/viscous

One BIG difference, James H... (Below threshold)
Les Nessman:

One BIG difference, James H.

You can choose to not give your money to Gannett and choose to give your money to Southwest. Or vice versa.

With the public employee unions, the taxpayer is given no direct choice. If you don't think the Sector B, Area 7 State Inspector isn't doing a good job and is overpaid for what he does, it's not like you can go to the Acme Inspector Agency and get another inspector. The law/statute/regulations say you must use a govt inspector.
Plus, the money collected for the Inspector is tax revenue, that you must pay under threat of govt approved violence against you, if it comes to it.

This is a good article whic... (Below threshold)
iwogisdead:

This is a good article which addresses an issue which is going to become more and more important. The state where I live is facing huge shortfalls in the educational budget. Schools are being shut down and the surviving schools are being crammed with kids. The local school board says that 80% of the savings in closing schools comes from salary. IOW, teachers are being fired because they cost too much.

This is how it works in a normal system--when wages are too high, labor is eliminated.

Fortunately, we no longer have a school-age kid, but the parents who still do are pretty upset. The new normal--and the future's not bright.

I bought american cars as a... (Below threshold)
dunce:

I bought american cars as a patriotic duty but now many foreign companys build here and build better cars. There was no bailout of gm and chrysler, it was a nationalization and a socialist redistribution of fairly earned wealth to political patrons.If i buy another car ,it will be built with non union labor.

One of the problems I have ... (Below threshold)
Eric:

One of the problems I have with Public Sector Unions is that it is a way to launder taxpayer money to the Democratic Party.

11 of the top 20 political donors in this country are unions, who give on average 99% of their donations to the Democratic Party. All together, since 1989 those 11 unions have donated over $330 million to the Democrats.

Number 3 on the list is the American Federation of State, County and Municipal Employees, the largest public sector union in the country. AFSCME gets its money from union dues paid by government employees who are paid by tax dollars. Since 1989, AFSCME has donated over $43 million to the Democratic Party.

The Democratic Party is owned lock, stock and barrel by the unions and are subsidized by tax dollars going to the public unions.

Collective bargaining is a ... (Below threshold)
LiberalNitemare:

Collective bargaining is a wonderful thing - especially if you get to elect the guy that your 'bargaining' against.

Barry is be... (Below threshold)
914:


Barry is beholden to Him, His self and He.


Good article. There ... (Below threshold)
Hcddbz:

Good article.
There is ly that is gated that no one held a gun to manamgnets head in they agreed. No one talks of the strikes walk outs or other action taken to ensure management accuqiesed to the demands.


I will admit to not being a big fan of modern unions having seen my father screwed over by them because he had the audacity to love his job and be a hard charger..


Public sector unions have no place in modern socity for the majority of professions. I would draw an exception to first responders and utility workers. That is because there work conditions change and they need to let people know about those changes. However teachers and officer workers need to just deal with it. Unions need members so that they can collect dues. They need a large number so the diues are unobtrusive. Therefore they are in direct opposition to limited government.

Wonderful piece of misinfor... (Below threshold)
Woop:

Wonderful piece of misinformation and lies. You have a future at Fox News!

Where to start...

"Collective bargaining is simply the process by which an appointed entity (usually a labor union, represented by a handful of officials chosen by its members) negotiates worker compensation with an employer. "

Bullshit. Much more than wages are negotiated, for example seniority and layoff rules, pension provisions, working conditions, conditions of employment. The list is long.

"When unions are allowed to collectively bargain with employers, the resulting contracts generally guarantee that workers are receiving a fair share of the income generated by the company. "

Wrong. Wages are based on marketplace and competitiveness. A company that grosses $5 billion a month will typically pay the same marketplace wages as a company that grosses $5 million a year. A union employee's wages has no relation to company profitability or "a fair share of the income" - total Fox News quality bullshit.

"and when similar union contracts are signed among competitors, these contracts prevent one company from "cherry-picking" the labor force of its competitors by offering disproportionate compensation."

Wrong, in fact it's illegal for companies to join together to determine pay scales. It's not unusual to see different companies paying 10% higher or lower wages within the same marketplace.

I love it when you guys "report" on subjects you have no friggin clue about.

"A privately owned company with unionized labor is governed through cooperation between its management, its shareholders, and labor representatives. This cooperation provides a system of checks and balances against abuse by one or more of these entities. Company finances are bound on the lower end by profit (which the company must earn in order to survive) and on the upper end by competition (which keeps the price of its goods or services within the range that consumers are willing to pay)."

What kind of nonsense is this? A company is not "...governed through cooperation between its management, its shareholders, and labor representatives." Labor representatives rarely have a say in the governance of the company. In rare instances there might be one or two labor reps on a committee or -- even more rare - on the Board of Directors, but that is not in anyway common.

"But this system does not exist in the public sector. Public sector employees are paid through tax dollars, the collection of which is compulsory, not through voluntary sales of goods or services. There is no "competition" to control pricing or offer alternatives to government-provided services. And, as public sector unions have long ago discovered, it is very easy for unions to control elections by marshaling votes and providing campaign contributions to favored candidates; those politicians then return those favors by endorsing government policies that favor unions. "

More bullshit. "It is very easy for unions to control elections by marshaling votes and providing campaign contributions to favored candidates" Control elections? Only in the hyper-moronic mind of a Fox News host are elections "controlled by unions".

"With this in mind, can public sector unions be trusted to ensure the best interests of their members, and of John Q. Taxpayer, who finances their members' compensation (and by default, the operation of the union, which is supported by dues paid out of its members' taxpayer-financed compensation)?

Absolutely not. Just like their for profit counterparts, public sector unions are there to protect the employee, not the taxpayer - just as private sector unions are there to protect the employee, not the customer.

What are you smoking? Or better -- where were you edumacated?

Elected officials and the management they hire are there to protect the taxpayer.

"Yet just as their UAW brethren did thirty five years ago when faced with the prospect of cutbacks in compensation from the Big 3 automakers, public sector union leaders are actively resisting any attempt to limit their members' compensation, or union collective bargaining power."

More bullshit. Sorry, there isn't a polite word for this made up crap. Public sector unions are making wage and working conditions concessions left and right - even in Wisconsin.

The issue in Wisconsin is over curbing the union's ability to adequately represent the employee. Why don't you read a newspaper? Something other than Fox News.

"Before General Motors was reorganized, over $1500 of the sticker price of each automobile that it sold went to pay for employee and retiree health insurance costs; these "legacy costs" were a major contributing factor to the eventual insolvency of the company. We simply cannot allow our state and local governments to be pushed into a similar corner through union contracts."

Pushed into the same corner? Through mismanagement governmental entities and other public sector orgs have negotiated contract provisions like pension plans and then failed to adequately fund them.

The fact that a state has unfunded pension liabilities is the fault of the non-union managers and the non-union elected officials.

Now these clowns want to take away and reduce the employee's pension because of the mistakes made by the elected clowns and the clowns they hired to manage.

"It's time to loosen the grip of public employee unions on the public purse strings, before we dig ourselves into a financial hole that we cannot climb out of."

In other words, it's time to strip away benefits of school teachers who have worked for 30 years because the Governor of Wisconsin gave tax breaks to the rich and is otherwise incapable of managing the crisis he volunteered to fix - so take it out of the hide of the teachers because hey - they tend to vote Democratic.

Hell no. I hope the Wisconsin unions shut down the state and run these mismanaging idiots out of office.

Now we know what Woop stand... (Below threshold)
914:

Now we know what Woop stands for:

Waste Of One's Poop

Funny thing is, a union con... (Below threshold)
Jim Addison:

Funny thing is, a union contract with a State isn't like a contract with a private company. If GM couldn't pay what previous managers agreed, they would have to declare bankruptcy and restructure, and usually would be able to rid themselves of onerous contractual obligations in the process.

States can't declare bankruptcy, but neither can they be sued by individuals or corporations in federal court without their permission. They alone determine what contracts they can honor and which they cannot.

It is ridiculous to argue otherwise, as easily seen by the extreme example. Suppose a particular Governor agreed to a egregiously lucrative contract for a union with a term of 99 years. Is it the position of the Left that yes, the State is stuck for the full period and can never alter the deal, no matter how unaffordable it is?

You can believe it, but the law says you don't get it. Leftist unionists, this is Reality. I don't believe you've met.

Woop wrote:<blockquo... (Below threshold)
iwogisdead:

Woop wrote:

I hope the Wisconsin unions shut down the state and run these mismanaging idiots out of office.

But, wait, Woop also said:

Only in the hyper-moronic mind of a Fox News host are elections "controlled by unions".

So, Woop has the "hyper-moronic mind of a Fox News Host." Either that or he/she/it wants unions to change government by means outside of the electoral process. Maybe that's it.

James H:Please exp... (Below threshold)
Ryan M.:

James H:

Please explain, using logic and not "Oh the evil EVIL rich" why you, or I, have ANY RIGHT WHATSOEVER to tell a company what it does with its money, how it accounts for its profits or losses? Without using the word 'fair' - which is liberal code for 'because I said so'.

You can choose to ... (Below threshold)
James H:
You can choose to not give your money to Gannett and choose to give your money to Southwest. Or vice versa. [But not to the state]

True enough. But I wasn't really commenting on public-sector unions, but rather on management-labor relations in general, as well as ways that good managers interact with workers.

In the case of Wisconsin, has the governor tried to negotiate head-on with the union from a position of shared sacrifice (i.e., I'm cutting expenses in gov house as well, voluntarily giving up a portion of gov's salary)? I honestly don't know if he has or he hasn't. I would think principles of management would translate from private sector to public sector.

Despite my leftward leanings, I really don't have strong feelings about Wisconsin one way or the other. My default position is that if you don't like the way your employer operates, you either (1) seek change within the workplace; or (2) find another job. During my career (100 percent private sector, thankyouverymuch), I have done both at times.

PS, Ryan:

Please explain, using logic and not "Oh the evil EVIL rich" why you, or I, have ANY RIGHT WHATSOEVER to tell a company what it does with its money, how it accounts for its profits or losses?

I have that right as an actor in a free marketplace in which feedback (i.e. information and commentary) is one of several vital mechanisms by which consumers and investors buy products from or shares in a particular company. Not only are both enterprises active members of this marketplace, but they are both publicly traded companies.

Additionally, under the "stakeholder" theory of corporate management, I qualify to comment on both companies' actions because I am a consumer of both news and air travel, and because I am a member of the greater community that is affected by these companies' decisions.

Now, reread my post carefully. Did I at any point say that Gannett or Southwest must do something? I did not. I said they should do something, and I averred that one company is an example of bad management, and another is an example of good management.

What, precisely, is untoward about this? I would love to hear your schpiel about why I shouldn't comment about management processes at publicly traded companies.

Les Nessman is at the very ... (Below threshold)
WildWillie:

Les Nessman is at the very core of the problem. When the public sector unions negotiate, neither one has a financial stake in the deal. The taxpayers are not at the table. Just a majority of legistaturs who will give the wages and benefits because they can garner full support for reelection. The union wins, the representative wins but the tax payer loses or at the very least has no say one way or the other. No one can possibly think this is fair. That is why FDR, Truman, Kennedy and many others thought is is inherently corrupt. Now we see the fruation of that mindset. The elected officials kicked the can down the road for many years and now it is time to pay. What do the unions want? The same system. ww

The Compensation "advantage... (Below threshold)
Tough Love:

The Compensation "advantage" that Public Sector workers have over their Private Sector counterparts is MUCH greater than most realize, and paying a few extra percent in employee contributions is woefully short. Read on:

Let’s cut to the chase …....

Private sector employers typically contribute 3%-8% of an employee’s cash pay towards retirement, yet the total cost (expressed as a level annual % of cash pay throughout one’s career) of Public Sector Defined Benefit pensions (for a 30-year employee retiring at age 55) ranges from 29% to 58% depending on the richness of the benefit formula (with safety workers generally at the highest end).

More specifically, for the noted formulas, the level annual %s of cash pay are as follows:
2% per year of service w/o COLA – 29%
2% per year of service with COLA – 39%
3% per year of service w/o COLA – 44%
3% per year of service with COLA – 58%

Even after deducting the typical employee contribution of about 5% of pay, that still leaves the employer (meaning TAXPAYERS) contributing 24% to 53% of pay. The middle of these %s is 38.5% vs 5.5% (the middle of the range of what Private Sector employers contribute) or SEVEN (yes SEVEN) times greater.

This is completely absurd, and the very modest “tweaking” at the edges by practically begging employees for a few more percent of pay contributions will NOT even begin solve the HUGE financial problem.

TOTAL COMPENSATION (Cash Pay plus Pensions plus Benefits) should be comparable in the Public and Private Sectors for similar jobs, and with Cash Pay in the Public Sector now AT LEAST equal to (if not greater) than that in the Private Sector, there is ZERO justification for greater Public Sector Pensions and Benefits .

Not for PAST service, but for FUTURE service, Public Sector pension accruals must immediately be brought FULLY down to the level of their Private Sector counterparts. Due to the huge reduction needed, the ONLY way to do this is to freeze the current defined benefit plans for CURRENT (yes CURRENT) workers, and switch everyone into a 401K-style Defined Contribution Plan with an employer contribution in the same 3%-8% range granted Private Sector workers.

Additionally, since Private Sector retirees rarely get any retiree healthcare subsidy before eligibility for Medicare at age 65, similar restrictions should apply to Public Sector retirees.

It’s TAXPAYERS’ money and Civil Servants are NOT more worthy of bigger pensions and better benefits.

Public sector unions are im... (Below threshold)
Jay Guevara:

Public sector unions are immoral (their "negotiations" with Dem politicians being redolent of corruption) and un-American.

Bottom line: All of 'em ... Got. To. Go.

Now.

Okay, then it's also not ok... (Below threshold)
Owkrender:

Okay, then it's also not okay for Chamber of Commerce-backed officials to negotiate public contracts with business interests?

Also, remember that the right to organize is a 1st Amendment Right. Sorry you find that inconvenient.

Okay, then it's also not... (Below threshold)
Jay Guevara:

Okay, then it's also not okay for Chamber of Commerce-backed officials to negotiate public contracts with business interests?

Not if they get campaign donations from them. That's ... a kickback, and corrupt.

Also, remember that the right to organize is a 1st Amendment Right.

Wrong. It's nothing of the kind. If it were a First Amendment right, why would JFK have had to sign an Executive Order to permit Federal employees to unionize?

The First Amendment says that, within limits ("Fire!"), you cannot be prosecuted for something you say. That's it. No one is saying people can't say their piece. You don't need a union to do that. Quite the contrary, in fact.

"Wrong. It's nothing of the... (Below threshold)
owkrender:

"Wrong. It's nothing of the kind. If it were a First Amendment right, why would JFK have had to sign an Executive Order to permit Federal employees to unionize?"

It was not until after JFK was murdered that the Supreme Court, in several different cases, established that the 1st Amendment right to free assembly extended to a right of free association. That's why...

I have very seldom met a un... (Below threshold)
Jeff:

I have very seldom met a union member who was a hard worker ... they could be but because of their union they don't have to be ... its that simple ...

fyi ... the majority of union members I've met are police, fire or teachers ... so don't give me the "nobel profession" BS ... maybe 30 years ago the majority where nobel, but no longer ... they are money grubing parisites ...

"But when it comes to auste... (Below threshold)
Sunvolt:

"But when it comes to austerity measures..." Boo-hoo-hoo! It is uncanny how we never hear about "austerity measures" being undertaken by the wealthy.

It was not until after J... (Below threshold)
Jay Guevara:

It was not until after JFK was murdered that the Supreme Court, in several different cases, established that the 1st Amendment right to free assembly extended to a right of free association.

Free association? You mean like all white country clubs, or all mens' clubs? That kind of free association?

You confuse freedom of association with the privilege of collective bargaining with the association. No one says people in a given job can't associate with each other; associate away.

But if those people are public sector employees, we're not going to bargain with you.

Their freedom of speech? Intact.
Their freedom of association? Intact.
It's collective bargaining with that association that's out.

"But when it comes to au... (Below threshold)
Jay Guevara:

"But when it comes to austerity measures..." Boo-hoo-hoo! It is uncanny how we never hear about "austerity measures" being undertaken by the wealthy.

Not true. I heard that Al Gore and Barbra Streisand are cutting back on how many mansions they have, and John Kerry is trading down to a smaller yacht.

I've heard about plenty. D... (Below threshold)
James H:

I've heard about plenty. Do you follow the legal industry? Consider associate attorneys at large law firms. They typically earn an annual salary ranging from the low to mid six figures.

By any measure, somebody in that income bracket, while not fabulously wealthy, is doing quite well for himself.

In the period from 2008 to 2010, as the economy crashed around our ears, a large percentage of those folks lost their jobs ... and they had a hell of a time finding new work.

Them? They went on austerity measures. You betcha. We're talking about people with graduate degrees moving back in with their parents because they couldn't find work.

And even those with significant savings felt the pinch as week by week went by without permanent work. So don't tell me "the wealthy" weren't affected.

Actually, the GM Profit Sha... (Below threshold)
Ron T.:

Actually, the GM Profit Sharing Plan was negotiated in the early 1980s (circa 1982) as a part of the GM/UAW contract that eliminated automatic wage increases at the time. The recent profit share is simply that agreement coming into fruition. The market ultimately determines the wisdom or foolishness of those contracts, (bankruptcy, anyone?). The public may choose to purchase a competitor's car (like Toyota or Honda) and avoid paying the increasing costs associated with such contracts. In the case of collective bargaining for public employees, this is not the case; because taxes are compulsory -- the taxpayer cannot choose not to "give the raise", as it were.




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