Saturday, January 21, 2012

Joining Los Angeles Times Debate on Public Sector Unions: Part 1

I long for the days when unions, whether public or private, cared about the interests of the individual consumers and the communities they were sworn to serve and protect, not just their own narrow interests.

President Franklin Delano Roosevelt understood the threat posed by collective bargaining among public sector unions. George Meany, the President of the AFL-CIO brought up the effects of public sector collective bargaining for the neglected taxpayer. Why should a work stoppage hurt those who have very little say in the negotiation of these lucrative contracts? Joseph McMartin claims that voters can fire the elected officials in the same manner that stockholders can dismiss managers in poor negotiations with private sector unions. This analogy fails in one fundamental point -- private sector stockholders can fire a manager immediately or even dissolve the company. Voters in the public have to wait two or four years before they can change the leadership, and by then it is too late to resolve contractual disputes or unconscionable benefits. What's more, whereas private firms can declare bankruptcy and disband from their contractual obligations to unionized workers, the state cannot break free of these contracts without the entire city or state declaring bankruptcy, which does immense harm to every shareholder, i.e. citizen in that community. Even if a city or a county declares bankruptcy, there is no certainty that a federal judge will void overgenerous obligations, which can still enforced as they are backed by state law.

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