Government Workers vs. Taxpayers

Wisconsin Governor Proposes Deep Cuts for Schools

March 1, 2011

AP – After focusing for weeks on his proposal to strip public employees of collective bargaining rights, Gov. Scott Walker on Tuesday presented his full budget — a plan that cuts $1 billion in aid to public schools and local government but avoids any tax or fee increases, furloughs or widespread layoffs.

Walker said the cuts could be paid for in large part by forcing government employees to pay more for their pension and health care benefits. And the governor whose cost-cutting ideas have stirred a national debate over public-sector unions gave no indication he would soften his demand to reduce their power at the negotiating table.

Schools and local governments targeted for cuts would not be allowed to make it up with higher property taxes.

"This is a reform budget," Walker told lawmakers inside the Assembly chamber as protesters on the floor below screamed, banged on drums and blew horns. "It is about getting Wisconsin working again. And to make that happen, we need a balanced budget that works — and an environment where the private sector can create 250,000 jobs over the next four years."

Walker's legislation has drawn tens of thousands of demonstrators to the Capitol over the last three weeks, and tensions were still high as Walker outlined the budget during a joint session of the Legislature convened under heavy security. Assembly Democrats refused to stand as the governor arrived to speak.

"It feels like we're announcing a going-out-of-business sale," said state Rep. Cory Mason, a Democrat from Racine who criticized Walker's proposed cuts to education.

Walker's budget places "the entire burden of Wisconsin's budget shortfall on our children, our most vulnerable citizens in need of health care and long-term care, and our dedicated public employees," said Robert Kraig, director of the consumer-advocacy group Citizen Action of Wisconsin.

Doing so is Walker's "own value choice, not an economic necessity forced on him by others," Kraig said.

The governor released his two-year spending plan in part to support his argument that public-worker concessions are essential to confront a projected $3.6 billion budget shortfall. His proposal to eliminate most collective bargaining remains in limbo after Senate Democrats fled the state to prevent a vote.

Wisconsin "cannot grow if our people are weighed down paying for a larger and larger government, a government that pays its workers unsustainable benefits that are out of line with the private sector," he said. "We need a leaner and cleaner state government."

By eliminating most collective bargaining, Walker says, state agencies, local governments and school districts will have flexibility to react quickly to the cuts.

The budget will put tremendous pressure on schools and local governments, which will be asked to shoulder huge cuts without raising property taxes to make up the difference.

Walker's budget includes a nearly 9 percent cut in aid to schools, which would amount to a reduction of nearly $900 million. The governor also proposed requiring school districts to reduce their property tax authority by an average of $550 per pupil — a move that makes it more difficult for schools to make up the lost money.

Additionally, cities would get nearly $60 million less in aid, an 8.8 percent cut. Counties would lose more than $36 million, a 24 percent reduction. They would not be allowed to increase property taxes except to account for new construction.

Walker estimates that his controls on property taxes would save $736 over the next two years for the owner of a home valued at the median price of $161,300.

He proposed a $500 million cut in Medicaid spending, which would be achieved through a number of changes that include increasing co-payments and deductibles and requiring participants in SeniorCare to be enrolled in Medicare Part D, too. Overall spending on the program would still increase, just not as much as it would have without the changes he's seeking.

Walker asked for $82 million in tax cuts, including an expanded exclusion for capital gains realized on investments made in Wisconsin-based businesses. The Legislature previously approved more than $117 million in Walker-backed tax cuts that take effect later this year.

The budget also cuts funding at most state agencies, by 10 percent, except for salary and benefits.

The governor would permanently eliminate 735 positions that have been vacant for more than a year. Some other jobs could be cut, but no widespread layoffs were envisioned. State spending over the next two years would go up a paltry 1.3 percent.

Walker targeted many law changes passed by Democrats in recent years, including a provision awarding prisoners time off their sentences for good behavior. Instead, Walker would reinstitute a truth-in-sentencing law that he sponsored while a member of the Assembly.

As expected, Walker proposed removing the flagship Madison campus from the University of Wisconsin system. The system has been ordered to study a similar move for the Milwaukee campus.

Over the next several months, the Legislature will review Walker's budget and offer revisions, with the expectation that lawmakers would vote by early summer.

It wasn't clear when Senate Democrats would return to take up the collective bargaining proposal. Walker said in his speech that their inaction could lead to thousands of layoffs in order to balance the budget, but decisions on whether to cut teachers and other local government employees are not up to Walker.

Republican Senate Majority Leader Scott Fitzgerald met Monday in Kenosha with some of the missing Democrats and discussed terms under which they could return. No agreement was reached.

Senate Democrats held their own news conference in Illinois after Walker's speech.

"It's a sad day for our state," said Sen. Dave Hansen of Green Bay.

Numerous compromises designed to end the stalemate have been floated by unions, Democrats and even a Republican senator, but none has gained traction.

In addition to the bargaining rights changes, the bill designed to fill this year's projected $137 million deficit called for refinancing state debt to save $165 million. But the deadline to get that done was Tuesday.

Walker has threatened to make more cuts after the deadline but has not outlined what those would be.

Polls indicate national public opinion favors unions in the dispute, but Walker has been resolute.

A Pew Research Center poll released Monday found 42 percent of adults surveyed nationwide sided with the unions and 31 percent sided with Walker. That poll of 1,009 adults had a margin of error of plus or minus 4 percentage points.

The latest New York Times-CBS poll found Americans oppose efforts to weaken the collective bargaining rights of public employee unions by a margin of almost two to one — 60 percent to 33 percent. The nationwide telephone poll of 984 adults had a margin of error of plus or minus three percentage points.

Just a quarter of adults in the poll considered public employees' benefits and pay to be too high, while about the same share believed they are too low. About 36 percent say they are about right.

Majorities oppose cutting public employee benefits or pay in order to reduce state budget deficits or taking away some collective bargaining rights from public employee unions.

Some of the opposition may stem from skepticism about the state government's motivations. Forty-five percent of those who responded to the New York Times-CBS poll believe states want to reduce employee benefits to help ease the deficit, but nearly as many (41 percent) say their aim is to weaken the power of unions.

Both polls were conducted Feb. 24-27.

Gov. Scott Walker Not Backing Down on Wisconsin Union Fight

February 27, 2011

The Christian Science Monitor - Two weeks into the political fight of his life, Wisconsin Gov. Scott Walker (R) shows no signs of backing down. Neither do the protesters camped out at the state Capitol in Madison.

For both sides, the battle over public employee unions – particularly the right to bargain collectively – is fundamental, almost visceral.

Police officials estimated the crowd gathered Saturday to number 70,000-100,000 – large numbers, even for a liberal university town that saw some of the biggest protests against the Vietnam War.

"I've been around Madison for 50 years, and I have not seen anything like it so far," Madison Police Department spokesman Joel DeSpain told the Los Angeles Times.

Pro-union sympathy demonstrations were held around the country as well.

As the stand-off continued, Gov. Walker said Sunday that the only alternative to his plan to cut public employee benefits and curtail collective bargaining rights for state workers would be lay-offs.

Majority Republicans in the Wisconsin state Assembly abruptly cut off debate and passed Walker’s bill shortly after midnight Friday morning. But Senate Democrats (also in the minority) are still holed up beyond state borders, denying Republicans the quorum necessary to pass the bill.

“If we do not get these changes, and the Senate Democrats don’t come back, we’re going to be forced to make up the savings in layoffs and that to me is just unacceptable,” Walker said on NBC’s Meet the Press Sunday.

Walker says he's trying to close a $3.6 billion budget gap for the next two years. That includes cutting $1 billion in payments to local governments as well as cutting the state contribution to workers' health care benefits and pensions.

Union officials have agreed to that, but Walker doubts their sincerity.

“Over the past two weeks, even after they’ve made those promises, we’ve seen local union after local union rush to their school boards, their city councils … and rush through contracts that had no contribution to the pensions and no contribution to health care,” he said on Meet the Press. “In one case, in Janesville, they were actually pushing through a pay increase.”

So far, there’s no give on either side regarding collective bargaining. (Walker’s plan would limit collective bargaining to wages, but only up to the rate of inflation.)

Potential GOP presidential candidates have been quick to use the Wisconsin political fight to beat up on President Obama, particularly as they seek to establish their tea party bona fides.

At a Tea Party Patriots rally in Phoenix Saturday, former Minnesota governor Tim Pawlenty accused Obama of “coddling out of control public employee unions.”

“Wisconsin does not need a lecture from someone who has never balanced a budget in his life,” Pawlenty said. (It may have been a sign that Republican presidential hopefuls still haven’t decided how cozy to be with the tea party movement that the only other speaker with White House ambitions was Rep. Ron Paul.)

As a presidential candidate, Obama once said,

“If American workers are being denied their rights to organize and collectively bargain when I’m in the White House, I’ll put on a comfortable pair of shoes myself, I’ll walk on that picket line with you.”

But aside from a brief statement when the protest in Madison began two weeks ago – describing Walker’s plan as “an assault” on unions – Obama has not been drawn into the rhetorical fight over weakening public employee unions.

"The president is one of the greatest politicians in the history of the United States, and he's quiet because he understands that most Americans know that [cutting government employee costs] has to be done," Mississippi Gov. Haley Barbour said Sunday on Meet the Press.

Obama stays out of the fightBut Obama’s not speaking up more on the issue does not mean others in his administration have been muzzled.

“The fight is on,” Labor Secretary Hilda Solis told the closing session of the Democratic National Committee’s winter meeting Saturday.

“We know there’s room for shared sacrifice,” Solis said, referring to “our brothers and sisters in public employee unions.”

“But the governors of Wisconsin and Ohio aren’t just demanding that they tighten their belts, they’re demanding that they give up their uniquely American rights as workers.”

While private sector unions have seen membership drop to about 6 percent in recent years, more than one-third of public employees remain unionized. Experts and analysts debate whether this relates to state budget woes, but it’s a major target for many of the 29 Republican governors.

"There may have been a time, a century ago, where public employees were mistreated and vulnerable and underpaid,” Indiana Gov. Mitch Daniels said on Fox News Sunday. “If that was ever a problem, we have over-fixed it.”

Ohio, Wisconsin Shine Spotlight on New Union Battle: Government Workers vs. Taxpayers

Fewer than 7 percent of private workers are unionized, down from about 25 percent in the 1970s

February 28, 2011

Washington Post - Across Ohio last week, the legislative push to restrict the union rights of government workers was greeted again and again by noisy protests.

But in this state dotted with manufacturing plants and their locals, this may have been more striking: At least some elected officials normally sympathetic to industrial unions were questioning whether they should side with government workers.

"I believe in what unions do, but as an elected official I represent the taxpayers," said Jeff Berding, a registered Democrat on the Cincinnati City Council who ran as an independent after he opposed the party on a union issue. "I'm trying to get the best deal for them."

The divide between government worker unions and their opponents, playing out now in several state capitals, highlights a critical aspect of the evolving labor movement.

Throughout U.S. history, the most prominent union clashes largely involved employees squaring off against big corporate owners over how to share profits. The recent state budget controversies feature union members bargaining against state and local governments over wages and benefits provided by taxpayers.

The shift reflects the profound changes in American unionism. Last year, for the first time in American history, a majority of union members worked for the government rather than private firms. About 36 percent of government workers, or 7.6 million people, are members of unions, compared with about 7 percent of private-sector workers, or 7.1 million people, according to the Bureau of Labor Statistics.

And with that evolution comes different tactics and politics.

"These people are bargaining against the American taxpayer," said Ned Ryun, a former speechwriter for George W. Bush and the president of American Majority, a grass-roots political training organization that also has helped coordinate anti-tax rallies. "I'm not sure they can win the PR battle. People are saying, 'You're kidding me. They're making that much and I'm paying for it?' "

Randi Weingarten, president of the American Federation of Teachers, was in Columbus this week for protests. She said in an interview that the argument that public unions are fighting the taxpayer is misguided.

"You have long-standing history in Ohio of using collective bargaining to do transformative things in education," she said.

Public vs. private

While government unions and their private-sector counterparts are lumped together under the labor movement umbrella, they are in some ways starkly different, emerging according to different laws and bargaining under different constraints.

While the National Labor Relations Act, passed in 1935, allowed employees to form unions and collectively bargain in much of the private sector, it was not immediately clear to what extent government workers should be protected by unions.

Union Bargaining Just a Dream for Many Government Workers

February 27, 2011

AP - Whenever Mississippi Gov. Haley Barbour has asked lawmakers to weaken benefits for state employees, his proposals have met little resistance from workers.

Mississippi is among those states — many in the South — where most government employees do not have the right to collective bargaining, the benefit that has caused a political upheaval in Wisconsin and has become a national flashpoint for those who argue that public employee benefits are too generous.

Those states provide a snapshot of what life is like for government employees who do not have the same union clout that workers in Wisconsin and some other states are desperately trying to retain.

"We've been holding on by a hair through the political process," said Brenda Scott, head of the Mississippi Alliance of State Employees, which has no bargaining power but provides a voice for state government workers to air their concerns before the governor and Legislature.

Across the South, governors like Barbour and state legislatures dominated by conservative lawmakers find it relatively easy to chip away at public employees' benefits or eliminate government jobs because most state employees in the region — even when represented by a union — lack collective bargaining rights.

Nine of the 10 states with the lowest percentage of public employees eligible for collective bargaining are in the South, according to data compiled by Barry Hirsch of Georgia State University and David Macpherson of Trinity University in San Antonio. Their research shows only about two in five public employees nationwide have the type of collective bargaining rights that have drawn fire in Wisconsin and other states.

To be sure, government jobs are still seen as more secure and desirable than most private-sector jobs even in states where public employees do not have the right to collective bargaining. In Mississippi, one of the poorest states in the nation, state workers get 10 paid holidays a year, their sick days and vacation days can be rolled over from year to year, and they can retire after 25 years of service under a defined benefit plan. They also have a certain level of civil-service job protection.

But those workers have fewer protections and generally less generous compensation and benefits than public employees represented by collective bargaining. While pay and perks vary greatly among states, the primary benefit is that governors and lawmakers cannot unilaterally impose changes, such as pension reforms, without going to the bargaining table, nor can they impose lay-offs without following union tenure rules.

In California, where most state employees are covered by collective bargaining, negotiated labor contracts allow state workers to retire, collect their pensions and then return to work, allowing them to make more money than before. They also can purchase more lucrative pension benefits before they retire.

Two independent government auditing agencies in California have recommended reforming the state's pension system, even for current employees, but unions there have vowed to sue if the governor and Legislature try to enact reforms outside the bargaining process.

Governors and lawmakers in states without collective bargaining can make such changes without consulting workers. Pensions for new public employees in Virginia, for example, were shifted last year from the traditional defined benefit — the type of pension that many governments say they no longer can afford without major changes — to a 401(k)-style system similar to that used in the private sector. The change was made with little fanfare and no organized opposition.

In North Carolina, some state workers are represented by a local of the Service Employees International Union, but the group has no bargaining power. That leaves employees with no real say over how many jobs would be shed this year due to budget cuts — Democratic Gov. Beverly Perdue has recommended eliminating 10,000 state government jobs, 3,000 of them currently filled.

In 2009, Perdue signed legislation that made sweeping changes to the state worker health insurance plans, creating higher premiums, deductibles and copays without having to get consent from an employee union. Barbour, a Republican with possible presidential ambitions, came into office on a promise to shrink Mississippi's state government and reduce employee benefits. Unencumbered by union contracts, he has scored a number of successes.

He persuaded the Legislature in 2004 to temporarily erase civil-service protections for corrections employees, which allowed the prison system to fire workers and trim the payroll. Mississippi lawmakers also voted last year to make public employees put 9 percent of their own pay into the state retirement system, up from 7.25 percent, and they've made government workers hired since 2006 pay more for their health insurance than their longer-serving colleagues.

Barbour defends his actions as tilting the balance of power away from unions and toward the side of state taxpayers. He said he supports Wisconsin Gov. Scott Walker's effort to eliminate most collective bargaining rights for government workers.

"When they have collective bargaining in Wisconsin, on one side of the table there's state employee unions or the local employee unions. On the other side of the table are politicians that they paid for the election of those politicians," Barbour said. "Now, who represents the taxpayers in that negotiation? Well, actually, nobody."

In states without collective bargaining, public employees are "completely subject to the power of the governor" because lawmakers often don't want to get involved labor disputes, said Ed Ott, who has been active in the New York labor movement for 42 years and is a former executive director of the New York City Central Labor Council AFL-CIO.

"It's really about a balance of power between employer and employee," said Ott, a lecturer on contemporary labor issues at the City University of New York's Murphy Institute. "Without any collective bargaining rights, you have no ability to say, 'Whoa, why don't we try something else?'"

Maryland and Tennessee have hybrid systems. Some Maryland employees are represented by unions and have the right to bargain with the governor, but there is no binding arbitration and no right to strike.

"We call it collective bargaining-lite L-I-T-E because they're not as strong as what you see in a number of the northern states," said Sue Esty, assistant director of the Maryland chapter of the American Federation of State, County and Municipal Employees.

Teachers in Tennessee have the right to collective bargaining, but other public employees do not. That is still too much for Republicans in that state's Legislature, who have wide majorities in both chambers and are looking to quash teachers' bargaining powers.

The Tennessee Education Association, which represents 52,000 teachers, has said the proposal is political payback by Republicans because the group has given more financial support to Democratic candidates over the years.

Gov. Bill Haslam has not signed on officially to the movement by his fellow Republicans, preferring to focus on teacher tenure, expanding charter schools and other issues he says are necessary to improve academic performance. But he also sympathizes with their intent to give the Legislature as much leeway as possible to control costs without having to submit to union negotiations.

"My job in the state of Tennessee is just like when I was running a company," said Haslam, a former president of Pilot Corp., a family owned national truck-stop chain. "It's to bring in the very best people to work, to provide the very best product we can, at the lowest price."

Like its neighboring states, Alabama does not allow public employees to bargain collectively, even though associations representing teachers and state workers have had some success working with the Legislature.

Lawmakers have approved cost-of-living raises and maintained health and retirement benefits that are better than those offered by most private-sector employers in the state.

The two organizations, which traditionally have supported far more Democratic candidates than Republican ones, have come under attack since Republicans gained control of the Legislature in November. Since then, a new law has stopped the organizations from using payroll deductions to raise money for their political action committees and any other political activity, greatly reducing their influence.

When the Legislature convenes Tuesday, one of the House Republican leaders will push a bill to provide state-paid liability insurance for education employees. Currently, the Alabama Education Association supplies this insurance as an incentive for teachers to join.

"Obviously what they are trying to do is discourage members," said Paul Hubbert, the association's executive secretary.