Labor Pains: Because Being in a Union can be Painful

Public Sector Unions Hold Taxpayers Hostage

Steve Malanga’s Wall Street Journal op-ed provides a good overview of how public sector unions are the most powerful and destructive forces in both federal and state government. Unions at the national level influenced the White House and Congress to funnel a significant portion of the stimulus funding to preserve public sector jobs in states and cities. And now they are fighting at the state and local level to preserve their salaries and benefits, even while private sector employees (union and non-union alike) are taking cost-saving measures to save their jobs. That’s not the case with public sector employees.

Employment in the public sector has grown “virtually every month of the recession.” The unemployment rate for government employees is only 2.8 percent. Malanga references a study that found that the average public sector employee earned 46 percent more in total compensation than comparable private sector employees. While state and local workers’ total compensation went up by 3.1 percent last year, private sector workers went up only by 1.9 percent.

The problem with this is that taxpayers are paying for the growth in public sector employees, even while the economy is in a downturn. This growth in union-backed bureaucracy is part of the reason why so many states have to raise taxes ($12 billion in California, $5 billion in New York) amidst a recession.

And this growing problem shows no signs of abatement. Public sector unions essentially have the ability hold politicians and taxpayers hostage. They flex their muscles in the political realm, spending millions in dues to lobby, organize, and campaign against any measure that threatens to cut back on spending or increase competition (such as school choice).

Malanga summarizes the vicious cycle that public sector unions and the government are engaged in:

“In the public sector, however, more union members means more voters. And more voters means more dollars for political campaigns to elect sympathetic politicians who will enact higher taxes to foot the bill for the upward arc of government spending on workers.”

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