The Public Union Dilemma: Why New Bounds Are Required

Both private and public union-management systems in the U.S. are controlled and bounded by similar rules (laws). Private sector union-management systems are inherently stable but public sector union-management systems are inherently unstable. The differences between private and public sector union-management systems are a significant source of the financial and political problems of our nation. Failing to recognize these differences can forever change our nation. There are several differences but the biggest difference between private and public unions is: “In the private sector managers must control labor costs to stay in business while in the public sector politician managers must allow increases in labor costs to be re-elected.” We must bound public unions through laws that reflect public union’s political management realities.

Union workers made up thirty-five percent of the workforce in the 1950s, this went down to 12.3 percent in 2009. The number of union members began to drop in part because the number of manufacturing jobs was decreasing, unions had been successful in achieving livable wages for relatively unskilled workers, and the increasing service jobs were less amenable to unionization. Realizing these facts, union leaders started a big push to gain access to government workers. In 1960, there were only 900,000 public sector union members. In 2009, 37.2 percent (7.9 million) of the approximately twenty-one million government employees belonged to unions, compared with just 7.2 percent of private sector workers. With the help of politicians, many public workers are now unionized. Unionized public workers constitute fifty-two percent of all unionized workers in 2009 and the public union percentage continues to grow at the expense of all private sector union and nonunion citizens.

Private sector unions-management systems are inherently stable because there is a balance between labor’s need for reasonable compensation and working conditions, and management’s need for controlling labor costs. This balance of needs results in a self-correcting system that is bounded by man-made laws as changes occur.

Private sector union demands for safely making a living wage that are viewed as fair by the general public puts pressure on management to be reasonable. The public has options of purchasing goods and services from competitors if they do not like a business’ treatment of its employees. Conversely, managers of businesses have constant pressure to maintain profits acceptable to their owners, and cannot afford to have long labor disruptions or excessive labor costs.

Historically, private sector union-management systems that peaked in the 1950’s have served the nation well. Private sector unions and good public policies made many bad private sector jobs evolve into good middle-class jobs for millions of citizens making many of their dreams attainable.

Public sector unions-management systems are inherently unstable because many career politicians are happy to provide whatever labor wants in exchange for labor’s dollars and manpower support for the politician’s re-election. This lack of self-correction results in a system that eventually reaches an unstable tipping point, and changes rapidly to some new status.

Many public sector union demands are not fair. Unhappy citizens have no options to purchase goods and services from a competitor. Public sector jobs involve health, safety, education, and personal services; thus, unlike the private sector, strikes are immediately very serious. Public jobs are seldom eliminated, and pay and benefits are better than similar jobs in the private sector. Politicians received public funds from unions for their re-elections since all union resources provided to a politician are passed on to citizens whether or not they like the politician.

Public sector union-management systems have not served the nation well, and continue to be a significant part of our federal, state, and local financial crises. Conditions have changed but labor, management, and politicians have not kept up. The present lack of adequate bounds on public employee unions needs to change. Many unions representing both public and private sector employees have become large and powerful. These near monopolies are not unlike business monopolies for which there are controls. Years ago the private sector had few long-term options other than to hire local workers. Today the world economy presents more options to outsource both labor and materials off shore. Many politicians exasperate these problems for personal or party gains by driving wedges between rather than uniting union-management members to solve problems.

Our public systems are at unstable tipping points where public employee unions are capable of “buying” enough politicians to get everything they want. This is what has happened to public sector unions-management systems throughout our nation today. Letting these union members make more in wages, benefits, and perks than do their counterparts in the wealth and job building private sector, and the use of public money controlled by public unions that is provided to “union compliant” career politicians needs to be stopped. The public sector is not a business. The public labor unions’ ability to support political persons and causes should not be equal under the law to those in the private sector. Conversely, the ability to support political persons and causes should be equal under the law for both private sector businesses and labor unions.

It is not clear career politicians will address these public employee issues. President Obama’s administration and many politicians seek the power that union support provides. We can expect planned “strong screams” about worker “rights.” But what about the “rights” of the private sector? Why should wages and benefits for public workers be higher than for similar jobs in the private sector when the private sector is paying the bill? The answer seems to be power politics. AFL/CIO boss Richard Trumka bragged in a taped video about how he speaks to the White House every day and visits 2-3 times a week. This is consistent with a quote from President Obama’s book, Audacity of Hope, in which he discusses relationships and states: ”So I owe those unions. When their leaders call I do my best to call them back right away,”and his later promise to, as president, walk picket lines for union labor’s rights. It appears we can expect the political party wars will continue with the democrats and administration letting the republicans take the heat for trying to clean up the mess. This strategy allows the democrats to stand on the sidelines and play their blame, divisive, is it awful, and other political tricks hoping to regain their lost power.

In California, a so-called “progressive state,” public unions essentially own the state. The almost two-thirds majority democratic politicians and the public unions walk in lock step. Fully fifty-four percent of state government workers – that’s almost 1.8 million people – are unionized. Governor Brown was a major champion for public unions during his first terms as governor in the late 1970’s. Today as Governor, he is attempting to manage a 2011-2012 deficit of over $25 billion by proposing taxes and “kicking the can down the road” to counties and cities while avoiding the “untouchables,” the public employees and their unions.

We have choices. We can either be held hostage by ever increasing governmental costs for public workers or we can act to bound public unions through laws that reflect public union’s political management realities. Unless we scream loudly, and educate those who will also suffer the consequences, the mess will only get worse. Let’s hope we are not too late.

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Dr. Cleland’s Ph.D. is from Purdue University where he specialized in complex systems theory. His technical training and experiences includes analyses of many types of systems, involvement with numerous federal, state, and local agencies, and management of a broad set of set of professionals, services, and trades people. He has managed scientists, engineers, policemen, firefighters, environment, health, safety and emergency planning experts, building trades and maintenance crafts personnel, and others.

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March 2011
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