George Rebane
[This is the submitted form of my regular column in The Union which appears in its 12nov11 print and online editions (here) under its less harsh title 'Public service unions will be our demise', no doubt edited for a more sensitive readership than frequent these pages.]
Today socialist Europe is unraveling after years of ‘robbing Peter to pay Paul’ has finally hit a brick wall. With riots in the streets, the Peters have run out of money and patience with a system of governance that simply does not work. And what has caused the rot now toppling governments of countries that have essentially gone broke and live on borrowed money? You need look no further than the trans-national common denominator – public service unions.
These unions have bloated governments to hire and retire workers in prodigious numbers. In Greece, the current paragon of socialist corruption, more than one in four of the country’s workers are government employees being paid benefits that are out of reach in the private sector. Well, the music has stopped and everyone there is scrambling for a safe seat. Why? Because the lenders are refusing to throw more money into a fiscal cesspool from which there is little chance of payback. Eurozone lenders say that there is less than one chance in ten that Greece will NOT go fiscally belly-up in the next twelve months.
But Greece is chump change when compared to Italy, Europe’s third largest economy on a headlong charge off the inevitable socialist cliff. Maybe Greece can be bailed for a year – anything longer is not feasible. There is no will left in Europe’s more fiscally prudent countries to rescue Greece. It will simply have to quit the euro, and print itself into oblivion with drachmas. But Italy is too big to bail and, for the sake of international stability, too big to fail. The country’s sovereign debt is over $2,500,000,000,000 (that’s trillions), and they can’t print euros.
Next to bankrupt behind Italy are Spain, Portugal, Ireland, …, and even France, whose banks have been heavy lenders to both Italy and Greece. And every one of the teetering Europeans has been put on a collision course with the iceberg by their respective public service unions that have organized their government employees into wards of the state – with recourse. When pushed, these short workweek, long vacation, early retirement, large pension workers know they can shut down their country in a heartbeat. They have done it before, and they’ll do it again.
Why does all this concern us? Because we connect to Europe in more ways than we can count, and we are copying their mistakes at an extraordinary clip. When public service unions appeared in America, our first socialist president FDR fought the idea, and wrote a prescient letter in 1937 about their collective bargaining powers, foretelling their disastrous impact on the country. He was ignored.
Over the decades since WW2, the power and reach of public service unions have grown through their incestuous relationships with elected politicians who became their handmaidens and co-conspirators in bamboozling private sector taxpayers (to the extent we pay government employees their salaries, we also pay their taxes). And so these cancerous unions grew until they metastasized through all levels of government, its agencies, bureaus, and schools. Today the active military is still free of their influence, but don’t hold your breath.
The spread of this cancer in our public infrastructure has recently been detailed by Philip Howard, chairman of the non-partisan, non-profit Common Good (commongood.org). It is a shocking tale of unions whose leaderships and members have bilked jurisdictions out of hundreds of millions, and run up unfunded liabilities into the hundreds of billions (California’s current obligation is over a half a trillion dollars).
The methods the unions have taught their members include ‘spiking’ salaries and going on disability just before retirement. We actually pay for them to take college courses on how to game retirement benefits. For example, 82% of senior CHP officers are ‘disabled’ in their last year of employment. Union rules tie the hands of government and school administrators, and sky-rocket operating costs. In the last ten years the LA school district succeeded in firing just five out of their 33,000 teachers at a cost of $3.5 million. And such stories are the norm in thousands of agencies, bureaus, towns, and counties across the country.
In sum, today almost every busted government budget can be traced back to the excesses squeezed out by public service unions with the help of their toady elected politicians. And as recent occupations and elections show, the European disease has now fully riddled our public sector, with its inevitable devastation soon to follow. Philip Howard advises – “America should ban political contributions by public unions, by constitutional amendment if necessary. Government is supposed to serve the public, not public employees. America must bulldoze the current system and start over. Only then can we balance budgets and restore competence, dignity and purpose to public service."
George Rebane is an entrepreneur and a retired systems scientist in Nevada County who regularly expands these and other themes on KVMR and Rebane’s Ruminations (www.georgerebane.com).
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