The Economist–The battle ahead on public sector unions

“Industrial relations” are back at the heart of politics””not as an old-fashioned clash between capital and labour, fought out so brutally in the Thatcherite 1980s, but as one between taxpayers and what William Cobbett, one of the great British liberals, used to refer to as “tax eaters”. People in the private sector are only just beginning to understand how much of a banquet public-sector unions have been having at everybody else’s expense…. In many rich countries wages are on average higher in the state sector, pensions hugely better and jobs far more secure. Even if many individual state workers do magnificent jobs, their unions have blocked reform at every turn. In both America and Europe it is almost as hard to reward an outstanding teacher as it is to sack a useless one.

While union membership has collapsed in the private sector over the past 30 years (from 44% of the workforce to 15% in Britain and from 33% to 15% in America), it has remained buoyant in the public sector. In Britain over half the workers are unionised. In America the figure is now 36% (compared with just 11% in 1960). In much of continental Europe most civil servants belong to unions, albeit ones that straddle the private sector as well. And in public services union power is magnified not just by strikers’ ability to shut down monopolies that everyone needs without seeing their employer go bust, but also by their political clout over those employers.

Read it all.


Posted in * Economics, Politics, Economy, Labor/Labor Unions/Labor Market, Pensions, Personal Finance, Politics in General, State Government, Taxes, The Credit Freeze Crisis of Fall 2008/The Recession of 2007--, The U.S. Government

3 comments on “The Economist–The battle ahead on public sector unions

  1. Bart Hall (Kansas, USA) says:

    People working in the government sector make approximately 40% more that their counterparts in the productive economy. The notable exceptions are a few people such as engineers who most likely could make more in the private sector.

    In my own parking lot I have overheard customers saying thing such as — and these are very close quotes — “It’s just too hard working in the private sector, so I’m gonna try to get a job with the county.” and “I’ve just got two more years to go before I can retire on a nice pension from the state.”

    I will state my position clearly: There is absolutely no justification for unions amongst government workers, and they should be abolished — yes, outlawed — at the earliest possible date. With it, governments should repudiate their pension “obligations” to such unions because such a contract was “fraudulent in the intent” … meaning it never was able to be fulfilled. I cannot contract to jump over a moving train, because my obligation was never actually possible, and any contract to that effect is void.

    Ditto defined-benefit pensions for government employees.

    As a matter of fact, let’s define government job pay at a rate 80% of that commonly available in the productive sector. Then those choosing to work for government really will have a servant’s heart.

    These people have no idea how much they are absolutely hated by the people whose lives they attempt to run and whom the force to pay for the development of their little bureaucratic fiefdoms.

  2. lostdesert says:

    Didn’t Ted Kennedy help usher in the monopoly govt unions? What a travesty. The teachers union last year spent millions on democratic campaigns. We are the ones who suffer. Democrats…teachers…unions…democrats…federal workers…unions, all in a continuous circle which canno be broken. We pay and pay and pay and they control our strings like we were puppets.

    George Soros and Barry Obama… what a team. Creating our Socialist Republic.

  3. IchabodKunkleberry says:

    Here’s an eye-opener regarding AFSCME (American Federation of State,
    County, and Municipal Employees). It is an appendage of the AFL-CIO.
    They are the 2nd or 3rd largest labor union in the U.S.
    According to the article, they contributed more than $87 million
    to campaigns in the 2010 elections. AFSCME funds Democratic
    causes over Republican causes by a ratio of 98 to 1. Here’s the link.

    I am seriously considering moving out of Illinois, where I was born
    and have lived these past 58 years. Onerous taxation is about
    to be levied on the citizenry of Illinois so that Baby-Boomer
    public-sector retirees can enjoy a cushy lifestyle, while the rest of us
    are only viewed as sources of revenue for a rapacious state.
    Flee from the taxation that is to come !