LaborPains.org

As cities across California and moreover, the entire state face financial obligations they can’t meet, the city of LA was on the cusp of reducing costs when the SEIU stepped in to bully another union.

Heaven forbid that the city of LA should be able to reign in employment costs and that another union be able to accept a deal the SEIU isn’t happy with.

According the the LA Times:

“Los Angeles Mayor Antonio Villaraigosa and his top budget advisers thought they negotiated a labor contract last week that would begin to address the steadily rising cost of employee healthcare benefits. But that deal, reached with the 4,800-member Engineers and Architects Assn., has come under attack from members of another civilian employee union, which contends that the agreement contains “unprecedented and dangerous” concessions and should be rejected.

With the Engineers and Architects voting on the tentative agreement this week, organizers with Service Employees International Union Local 721 have begun warning that the proposed pact is part of a larger effort to “divide and conquer” the city’s civilian employee groups.”

The head of the beleaguered union says that behind the SEIU’s interest in the deal is their ongoing attempts to raid his union. So much for the “new directions” under Mary Kay Henry:

“Any move by one union to interfere with the negotiations of another union will ultimately backfire,” Szabo said, “because the city is likely to impose these healthcare provisions and more on those who opt out of the deal.” Michael Davies, interim executive director of the Engineers and Architects, said the Service Employees International Union is opposing the deal as part of its push to raid his union’s membership. Last fall, nearly 2,000 workers from his organization moved to the SEIU.

While unions will not let their hopes and dreams for the Employee Free Choice Act, or EFCA, go, arguing for the “freest and fairest elections,” they seem quite content to deny taxpayers (the ones footing the bill) the ability to vote on pension reforms. I guess fairness isn’t what EFCA was about after all. From the Silicon Valley Mercury News:

Unions representing Menlo Park city workers are expected to file a lawsuit today in an effort to prevent a pension reform initiative from going before voters on the November ballot. The ballot initiative, spearheaded by Citizens for Fair and Responsible Pension Reform, would reduce pension benefits for new city employees. The organization gathered 2,788 signatures, more than the 1,884 needed to qualify for the ballot. The council in May approved the initiative for the Nov. 2 ballot.

Today at noon, representatives of the local chapters of the Service Employees International Union, which represents non-management city employees, and the American Federation of State, County and Municipal Employees, along with some residents and city workers, are scheduled to hold a news conference outside Menlo Park City Hall after the lawsuit has been filed. An SEIU representative called the initiative unlawful, but wouldn’t elaborate on the legal grounds for the lawsuit against Menlo Park. In the past, AFSCME representatives have said the ballot measure violates a state law that prohibits amending retirement contracts through initiatives.

Image from Dean Terry.

It’s summer time, and that means it’s time for America’s children to get to their summer reading!

That is, unless you live in Santa Cruz, California, where the SEIU’s negotiations with the city may shut down local libraries for three months:

“All but one county library could close for three months, smaller branches could be shuttered permanently or hours at all branches slashed further if managers and union workers do not reach an agreement to save money on this year’s budget. [...] Basically we’re coming up with plan B or C or D,” said Library Director Teresa Landers. “We have our fingers crossed that the city and SEIU will be able to come to an agreement.”

“Library leaders find themselves in a unique position because while the Joint Powers Board governs 10 branches from Santa Cruz to La Selva Beach, library workers belong to the city of Santa Cruz chapter of SEIU. Therefore employees negotiate their contracts with city leaders, not library leaders. As a result, Landers said, issues that hold up talks at the city level affect the libraries, too. Santa Cruz is in talks with SEIU to help save $3.7 million from next year’s city budget.

“Landers said she and board members are hoping that SEIU agrees to continue concessions made to save money last year, which include postponing 5 percent raises and taking an unpaid day off each week. The library’s budget next year is just under $11 million, a drop from $11.3 million.”

Given what happened in Palo Alto in the fall when another library closed due to a strike, I recommend that California’s children save themselves and horde books. Perhaps they could pick up my Grandfather’s book, “Unions–Who Needs Them?”

Here’s the first thing you need to know about Senator Casey’s event on March 22, 2010, introducing the Create Jobs and Save Benefits Act of 2010, is who was in attendance at the announcement:

“Senator Casey was joined at the event in Carlisle by representatives from YRC Transportation, ABF Freight Systems and the International Brotherhood of Teamsters.”

Folks these days know that if you put the phrase “Create Jobs” at the beginning of a piece of legislation, its easier to yell at your opponents about how they opposed a “jobs bill.” There are about one hundred cliches, mores, and epithets that would work  right about now, but I think sticking with the old favorite “You can’t judge a book by it’s cover.”

Borrowing from the Wall Street Journal, the bill would better be entitled “The Union Pension Bailout.” Because that’s what it is. During the health care legislation reform debacle, part of the bill was section 164 that bailed out failing pension funds to the tune of $10 billion USD.  It passed in the final version of the bill relatively unnoticed, giving Jimmy Hoffa a taste of sweet, sweet success.

Ten billion dollars is a drop in the bucket compared to how much money this legislation would cost. From the Wall Street Journal:

“Mr. Casey is claiming his multi-employer-bailout scheme will cost a mere $8 billion, but Moody’s estimated last year that multi-employer plans were $165 billion underfunded.”

“The tab is likely to be much higher given the moral hazard Mr. Casey would create. As Hudson Institute economist Diana Furchtgott-Roth notes, the bill creates “a vicious circle. Once PGBC took over some plans, other employers would want to declare bankruptcy, unload plans on the PGBC, and reorganize under another name. The incentives to do this would be enormous.” [...]

Union chiefs prefer the power that comes with managing huge pension investments—even if they’re failing. They are now counting on Mr. Casey to preserve their power by making taxpayers pick up the tab for years of pension mismanagement. With the union priority of “card check” stalled, word is that the Casey bailout is Big Labor’s consolation prize. Taxpayers should let Congress know they don’t want to pay.”

If Hoffa wins this one, perhaps it will be enough to fend off the attacks from within his own ranks. Vice President Fred Gegare is vying for the number one spot, according to reports, in the upcoming election in 2011. Interestingly enough, the reason Fred Gegare cites for breaking ranks with Hoffa is all about pension funds:

Gegare especially points to the decision to let UPS out of the Central States Pension Fund, saying that move has led to employers “lined up” to get out of the pension fund, with Central States losing two-thirds of its participants. Gegare is the union chair of the Central States Pension Fund. He also alleges that the union is experience financial difficulties because of some Hoffa decisions. “I cannot understand some of your decisions in the last four years regarding some of your expenditure that you were questioned about,” he writes.

Gov. Paterson may have gotten mad in January, but he’s finally laying down the law against labor unions in the state. According to the Wall Street Journal, Governor Paterson is considering going all Schwarzenegger on the State of New York:

“In his most aggressive move yet to slash state labor costs, Gov. David A. Paterson on Tuesday presented lawmakers with a choice of either freezing government operations or imposing a one-day furlough without pay for 100,000 unionized state employees. [...]

For months, the administration has tried to extract about $250 million in labor-reduction costs from the largest public employees unions, the Civil Service Employees Association and the Public Employees Federation. Union leaders have refused to relinquish a scheduled 4% raise that went into effect last month.

The governor said the unions “have given us nothing. Everyone is sacrificing. They are basically telling us they shouldn’t take a cut at all.” The governor said the furlough measure would save the state about $30 million, marking the first time the administration has cut costs this fiscal year, as opposed to deferring them.”

As an FYI for Paterson, the unions haven’t made it easy for Gov. Schwarzenegger. At all. But if the Mayor of San Francisco’s victory isn’t proof that standing your ground “works,” I don’t know what is.

Image courtesy of M. Bob in Tokyo.

Higher public sector unionization means higher public sector debt (speaking of the debt, have you seen our sister organization, the Employment Policies Institute’s Defeat the Debt campaign?). Labor unions generally ignore the connection, or claim its caused by something else, but when public sector employees are draining state coffers, like California’s, into deeper debt, it’s an unavoidable connection.

From Boortz.com:

The Cato Institute did a little study on states and their rising debts. Interestingly enough, they discovered something common among states with high per-capita debts.

That something in common would be a high level of unionization of government employees. Yup, the states with the highest per-capita debt also happened to be the states with the largest government union workforces. You can see a handy little chart if you click here, but here are some of the details:

Among states whose government workers are less than 40 percent unionized, median per capita state debt is $2,238.

Among states with between 40 and 60 percent of their government workers in public sector unions, the average debt is $3,609.

Among states with more than 60 percent of the government workforce unionized, the average (median) per capita debt is $6,380.

Image courtesy of Jeff Belmonte.

From the Wall Street Journal:

“According to the U.S. Bureau of Labor Statistics (BLS), from 1998 to 2008 public employee compensation grew by 28.6%, compared with 19.3% for private workers. In the recession year of 2009, with almost no inflation and record budget deficits, more than half the states awarded pay raises to their employees. [...]

“By the way, nearly this entire benefits gap is accounted for by unionized public employees. Nonunion public employees are paid roughly what private workers receive. What if government workers earned the average of what private workers earn? States and localities would save $339 billion a year from their more than $2.1 trillion budgets. These savings are larger than the combined estimated deficits for 2010 and 2011 of every state in America.” [...]

These stark statistics bring to light contracts that are a testament to successful efforts by unions and a relic of a different economy where people did not noticed the discrepancy quite so much. That’s not the case anymore. The Economist shed light on this last month. New York finds itself on the brink.  California too. The Wall Street Journal continues:

“So if your state is broke, this is a major reason. Eventually, governors, state legislators and city council members are going to have to decide whether protecting America’s privileged class of government workers is a higher priority than funding such core functions of government as public safety. Something has to give. It’s time to close the biggest pay gap in America.”

Image courtesy of Maury McCown.

You heard that right. Somehow SEIU President Andy Stern passed the vetting to be nominated for the National Commission on Fiscal Responsiblity and Reform, so-named so that it can be declared a success without actually reducing any deficits.

He has gleefully accepted. From the SEIU release:

“I am honored to have been asked to serve on the National Commission on Fiscal Responsibility and Reform, and thank President Obama for ensuring that the voice of ordinary working Americans will be heard. “I have talked to thousands of our members, many low-wage workers, who have to make hard choices everyday to make ends meet, while never losing sight of their dreams — to provide a more prosperous future for their families.”

The Daily Caller hailed the move as par for the course for the Administration. Hot Air exclaimed that perhaps President Obama was getting tired on Stern and saw the commission as a perhaps opportunity to get him out of Obama’s hair. The Atlantic pointed out he’s not the only SEIU-er on a high level panel; SEIU’s Anna Burger sits on the Middle Class Task Force and the President’s Economic Recovery Board.

The Atlantic continues that “oddly enough” Stern opposed the commission when it was being considered in the Senate.

Maybe the difference is that the Senate commission possibly would have had some teeth.  The labor-laced presidential commission on the deficit is practically guaranteed to have nothing of the sort.  For Stern this means access to his favorite house (The White House) and clout. Stern likely will have little meaningful to say about deficit reduction–unless you count his own experience spending flagrant amounts of other people’s money, all while being millions in debt.

Image courtesy of Squeaky Marmot.