Opinion and Economic Analysis and Labor

HICKS: Failure of public unions is good for country

June 9, 2012

This week’s recall vote in Wisconsin has been heralded by many observers as a forecast of the presidential election. I think they are wrong. It is far more consequential.

Instead, this election is a serious conversation about public unions and their benefits—something many state and municipal governments need to address to dodge a Greek-style disaster that’s far closer than most Americans recognize.

The salient issue of the Wisconsin recall is the surrogacy of public-sector unions in states’ and local governments’ budget processes. Even a punishing loss by the reformer, Gov. Scott Walker, would not have changed the frightful truth: Public-sector unions have become vestigial to state and local governance.

The growing irrelevance of public unions is not new. The Ball State Chapter of the American Association of University Professors, for example, last updated its website in the fall of 2006—about the same time Facebook entered the scene. But Wisconsin is a special case. Madison is where public-sector unions were launched in the 1930s, so Walker’s reforms are especially significant.

In Wisconsin, the end to mandatory membership saw union enrollment plummet by two-thirds. Freedom of choice meant the majority of government workers and teachers in Wisconsin made the simple calculations and abandoned the unions. It is not hard to figure out why.

Throughout the nation, the profligacy of government spending is becoming apparent to even the most ardent spendthrift. A dozen states border on effective bankruptcy, while those most fiscally prudent thrive. But one need not be a student of public finance to understand the problem. Just compare the pension and health care plans many public employees receive with those in the private sector to see a crisis in the making. Wisconsin signals hope, but three additional points need making.

First, it is common rhetoric—especially in Indiana—to accuse those who oppose public-sector unions of “demonizing” public workers. There’s no better way to stir up member passions. But that tactic failed in Wisconsin. The unparalleled exodus of public-union members proved beyond a doubt that most government workers aren’t looking for special breaks, early retirement and exceptional perks. They simply want to teach students, improve their cities and towns, and keep their neighbors safe.

Second, the real political beneficiaries of the Wisconsin vote are not Republicans, but Democrats. Throughout the nation, the states, cities and towns that face bankruptcy over public-sector unions are overwhelmingly Democratic bastions. These Democratic governors and mayors around the country seek ways to unburden their budgets from decades of union excesses. This recall provides real ammunition for change.

Finally, the Republic could well benefit from thoughtful, spirited, public-minded unions representing government workers. What we have now is none of the above.•

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Hicks is director of the Center for Business and Economic Research at Ball State University. His column appears weekly. He can be reached at cber@bsu.edu.

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