In 2012, Wisconsin’s Republican governor, Scott Walker, was forced into a recall election after less than two years in office. The reason: his plan to restrict collective-bargaining rights for public-sector workers and to make such workers contribute more to their health-care and pension plans. He also ended the automatic dues-paying requirement for these unions, making it more difficult for them to raise money from their members. (Showing shrewd political instincts, Walker exempted police and fire unions from the new law.) Massive protests erupted in the state capitol, but Walker retained his seat, winning even more votes in a recall election than he had in his first electoral victory.
Since the Great Recession, the role of public-sector unions has gained more attention from Republicans such as Walker, and even from some reform-minded Democrats. This has occurred at the exact moment when the number of unionized public-sector employees has surpassed that of private-sector union workers. Our traditional vision of the American union member has been the blue-collar tradesman or steelworker, but today the typical union member is more likely to be a teacher, a firefighter, or a health-care worker. Roughly one-third of government workers are unionized, while less than 10 percent of private-sector workers belong to a union.
Daniel DiSalvo, a political scientist at the City College of New York, finds this a highly consequential development, and argues that historians and political scientists have not given it enough attention. The dominant academic and journalistic narrative has focused on the (undeniable) weakening of American private-sector labor unions, and neglected the transformation of public-sector unions into the dominant force in organized labor and a major political force in the Democratic party.
DiSalvo has written an important and timely book, one that should serve as a primer for anyone concerned about public finance and the size of government. His basic argument is that “the introduction of unions and collective bargaining into government labor relations has increased costs to taxpayers, weakened state and local public finances, and exacerbated labor-market inequities.” Public-sector unions “increase the costs of government without providing commensurate benefits to the public.”
The author is critical of public-sector unions, but his book is anything but a polemic. He is the son and grandson of union members and, as a professor at a public university, he pays representation fees to a union. Instead, Government against Itself combines current social-science research on public unions with a review of recent news stories to produce a readable and eminently sensible overview of the topic. He offers a study “shorn of mythology” and devoid of the usual romanticization of labor unions too often found in academic studies.
Throughout American history, unionizing public workers and granting them collective-bargaining rights was thought, even by liberals, to be a bad idea. Franklin D. Roosevelt and union leaders such as the AFL-CIO’s George Meany agreed on that. To begin with, when private-sector unions win concessions from their employers, their gains come out of corporate profits. In the public sector, such labor gains come not from profits but from tax dollars.
Another problem with government unions is that they are able to help elect those whom they are facing across the negotiating table. A politician who has received large campaign donations, in addition to large numbers of campaign volunteers and a great deal of organizing assistance, from public-sector unions is much more likely to look favorably on those unions’ demands when it comes time to negotiate. Wouldn’t autoworkers love to be able to “elect” the management of the car companies with whom they must collectively bargain?
DiSalvo presents a raft of statistics demonstrating how public-sector unions have in fact helped drive up the cost of government and destabilize the finances of many states and local governments. Since the Great Recession, employment in state and local governments has actually declined, yet spending continues to increase. It is not really the salaries of government workers that are the problem — it is their pension and health-care obligations. In New York City, spending on government workers’ pensions increased from $3.2 billion in 2005 to $7.8 billion in 2012. Sixty percent of Washington State’s budget goes to pay salaries and benefits for its workers.
Many (but not all) government workers pay little toward their health-care and pension plans. At all levels of government, increasing debt is a growing concern. As local and state governments pay more for workers’ pensions and health care, other government spending must be pared back. The other option is tax increases, but states with highly unionized public-sector workers already have larger-than-average tax burdens. Raising taxes in these states will make them even less competitive with states with lower taxes, diminishing their tax base and further destabilizing their finances.
Public-sector unions drive up government spending in other ways. Take Medicaid, which is becoming a larger and larger percentage of state budgets across the country. In no state is this truer than in New York. A 2012 report by the nonpartisan State Budget Crisis Task Force noted that the state’s Medicaid program was “by far the largest, most extensive, and most expensive in the country.” That is in no small part due to the lobbying efforts of the 1199SEIU, a political powerhouse that represents state hospital workers. As DiSalvo explains, the union and its employers — New York’s hospitals — have actually worked hand in hand to push for more Medicaid spending and looser eligibility requirements.
In today’s political world, public-sector unions have a level of strength and clout that old-time trade unions would have envied. The numbers are stark: Between 1989 and 2012, public-sector unions were three of the top six donors to American political campaigns, and six of the top 15. And they give almost exclusively to Democrats. The American Federation of State, County, and Municipal Employees (AFSCME), with around 1.5 million members, donated some $46 million during that period, more than the National Association of Realtors or Goldman Sachs. In addition, these public-sector unions provide many of the foot soldiers for the Democratic party’s notoriously effective ground game come election time.
Nowhere is the political power of public-sector unions more evident than in education. For years, teachers’ unions have been persistent obstacles to nearly all attempts at education reform, from charter schools to assessments of student learning. Liberals might think such advocacy beneficial, but they should be more cautious. DiSalvo cites a study of California’s corrections-officers’ union that shows that the union was a major force in pushing for more prison construction and the passage of tough law-and-order measures such as the state’s “three strikes” law.
DiSalvo is careful not to scapegoat public-sector unions for all our fiscal woes. He examines the question of whether government workers make more than private-sector workers, a charge heard often from Republican politicians. What he finds is that lower-skilled workers in government do make more than their counterparts in the private sector: A unionized janitor working in government will make more than one working for a private company. But higher-skilled workers in the private sector will outearn those with similar skills who work in government. Where government workers have the edge is in job security and benefits, thanks largely to collective bargaining.
DiSalvo takes care to review the case for public-sector unionism. Such organizing has helped government workers achieve middle-class status. In New York City, for instance, the rise of collective bargaining in the 1960s has resulted in dramatically improved living standards for sanitation men, transit workers, and other government employees. But there is a cost to such progress, and DiSalvo argues that — even though public-sector unions often couch their arguments in terms of a larger social good — there are actually few public benefits that accrue from government unionization. The benefits accrue mostly to the union members, while the rest of the public must bear the costs.
DiSalvo provides some suggestions for modest reforms, mostly modeled on what Governor Walker did in Wisconsin: making government workers “pay their fair share” toward their health care and pensions, removing pension benefits from collective bargaining, and eliminating the agency shop in the public sector, whereby all employees in a bargaining unit must pay some kind of union dues, usually collected through their paychecks. These measures would not eliminate public-sector unions, but instead ease some of the fiscal burdens they have helped create.
These reforms are essential because of the danger of what DiSalvo calls the “French disease”: an “economic sclerosis resulting from the demands of public-sector unions, social-service providers, and other interest groups.” Consider Italy, where the unionization of railworkers means that on any given day you run a 50–50 chance of some kind of transit strike somewhere. It is no accident that governments with the kind of bloated public sectors that encourage such activity, whether in Italy or in Illinois, are also struggling with massive public debt. Stronger economic growth would help state and local governments deal with these problems, but greater unionization and higher taxes to fund the benefits that accrue from collective bargaining just as surely dampen such growth.
DiSalvo is correct to note that the “politics of collective bargaining and public pensions are likely to [become] more partisan and polarized than ever.” The political influence of public-sector unions within the Democratic party continues to grow, and their demands will increasingly collide with efforts to deal with long-term pension and health-care obligations as states and local governments confront the problems of structural deficits and mounting debt. In that case, Wisconsin will prove to have been the first battle in a very long campaign.
– Mr. Cannato teaches history at the University of Massachusetts, Boston, and is the author of The Ungovernable City: John Lindsay and His Struggle to Save New York.