Understanding the Corruption Inherent in the Public Employee Unions

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The American private sector labor movement is an important part of our history. It provided a needed balance between large businesses and individual workers. By imposing the collective power of human resources against the financial power of the businesses, a balance was struck — management, responsible to the shareholders, sought to hold down labor and production costs, while unions sought to maximize benefits and working conditions. The resulting tensions tended to provide living wages while maintaining profitability. The growth of America’s great middle class — the backbone of our political and economic engines — was an outgrowth of the private sector labor movement combined with the entrepreneurial skills of America’s mainstreet retail merchants.

Not so with the public employees union movement.

In fact, even as the labor movement grew in America, federal, state and local governments either prohibited public employee unions or barred them from engaging in strikes or other forms of labor activities. The reasons were clear and reiterated by legislature after legislature and state supreme court after state supreme court. The affairs and services of government were too important to be disrupted by strikes of other labor activities. Even though policymakers understood the dangers of public employee unionism, they failed to foresee the real evil inherent in combining politics and mandatory union membership for government employees. It is the very lack of tension, inherent in private sector union/management relationships, that has proven the breeding ground for the corruption of power that has ruined states like Californian and New Jersey and is on the verge of ruining Oregon.

It took specific legislative acts in Oregon and other states to permit collective bargaining by public employee unions. It is unfortunate that the politicians of those days did not have the foresight to understand the inevitable corruption that would follow.

In a recent column Washington Examiner columnist Michael Barone provided a succinct description of the dangers of public employee unionism:

“Public-sector unionism is a very different animal from private-sector unionism. It is not adversarial but collusive. Public-sector unions strive to elect their management, which in turn can extract money from taxpayers to increase wages and benefits — and can promise pensions future taxpayers will have to fund.” [Emphasis supplied]

That is it pure and simple. In states like California, New York, New Jersey and a host of others, the public employee unions spend the monies extracted from mandatory dues to elect the very persons with whom they will bargain. The net effect is that the elected politicians no longer represent the interests of the citizens/taxpayers of the state, but rather the interests of those who have funded their elections — the public employee unions. Where then is the balance, the tension between labor and management? It doesn’t exist. It doesn’t exist in terms of the loyalty of the politicians to the citizens/taxpayers because it was the unions, not the citizens/taxpayers who paid for their campaigns. It doesn’t exist in terms of the natural reservations about spending ones own money because it is the citizens/taxpayers monies that are spent. And it doesn’t exist in terms of the resistance to raising money because it is extracted unwillingly from citizens by virtue of mandatory taxes.

In Oregon, the public employee unions extract about $60 Million every biennium in the form of mandatory contributions. They are aided by the state and local governments who have, as a part of collective bargaining agreements, agreed to collect those mandatory contributions by withholding it from employee paychecks. The amounts are remitted quarterly, or more frequently depending on the collective bargaining agreements.

Because public employees must belong to the unions as a condition of employment there is precious little of the $60 Million that is spent on organizing and recruitment. Because the unions bargain with those whose elections they have paid for there is precious little of the $60 Million that is spent on collective bargaining. Virtually the entire $60 Million is available for political activities including political education, candidate recruitment and training, direct campaign financing, polling, canvassing, providing campaign volunteers and a variety of other activities.

The results were predictable. The Democrats who receive virtually all of the formal and informal political assistance from the public employee unions dominate Oregon’s political landscape. They hold every statewide office, hold a supermajority in both houses of the legislature, have both United States Senate seats and four out of five of the House of Representative seats for Oregon.

And with the Democrat dominance of Oregon politics, the public employee unions have fared very well. In addition to their generous annual salary increase, most public employees are entitled to a “step increase” — in essence receiving two raises annually. Gov. Kulongoski granted unions members an additional five percent (third) increase a couple of years ago. The public employee healthcare benefits now average nearly $1200 per month and the taxpayers are on the hook to fund their gold plated retirement plans which, today, have an unfunded future liability of nearly $18 Billion dollars. While Oregon’s private sector employees lost nearly 130,000 jobs in the recent recession, the public employee unions added over 2,200 jobs — complete with generous healthcare benefits and gold platted pension benefits. The unions have been successful in eliminating a secret ballot for determining union representation, instead implementing a system in which the public employees are exposed to the threats and intimidation of union thugs. And finally, the unions now stand first in line in terms of insuring payment of their benefits — state law now requires payments to fund PERS be made before budgeted amounts are released to state departments.

The nature of the America’s “tea party” movement is to expose and rectify these abuses of government. Let us hope that they seize upon Oregon’s abuses before it is too late — before Oregon becomes the next California.

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Posted by at 06:00 | Posted in Measure 37 | 28 Comments |Email This Post Email This Post |Print This Post Print This Post
  • Jerry

    Unions defined:

    People who take money from hapless. luckless losers, keep some for themselves, and then give it to people who take from those who work and give to those who do not.

  • Britt Storkson

    Great article but there are other unfair advantages the unions have. Not only do union member NOT have Union members are not guaranteed fair, impartial third party elections of union bosses. The union bosses conduct the elections, count the votes and declare the winners. So the “rank and file” cannot replace the union bosses even if 100% of them wanted to.

    I’m running for state representative (district 59, The Dalles) in the Republican primary against a RINO John Huffman who is against fair, impartial third party elections. This is a critical issue because if our election process does not allow us to elect the leaders we can kiss any freedom we have left good bye.

  • Erik Seligman

    This article shows how important it is for us to take advantage of any cracks, however small they might be, in the public employee unions’ armor. Remember that local government bodies, like cities, counties, and school boards, are the employers of huge numbers of unionized staff. School boards are especially important, as they can approve charter schools, a major opportunity to hire non-union workers to replace poorly performing unionized employees.

    Any conservatives in Oregon who are concerned about these issues should seriously consider running for a local govt office. Please sign up at http://rescueoregon.com for more information!

  • Ron

    I’m know there are public employees who frequent this website, perhaps even union bosses. I’d like to see some of you step up and tell those of us in the private sector why we should allow you to bankrupt this state.

    Waiting………..

  • Bill Sizemore

    Nice article, Larry. All true.

    However, where was your support when I placed measure after measure on the ballot to end the use of public sector payroll deductions for politics? Where was the business community money supporting our campaign? We lost by four-tenths of one percent after the OEA, SEIU, AFSCME and friends spent more than $12 million fighting us.

    If the business community had invested a fourth of what they just spent on the Measures 66 and 67 campaigns, we would have won in 2008 and the unions would not have had the money to do what they just did to us.

    It is easy to write articles about the evils of public sector unionism and I am glad you wrote this one. But it is another thing to get out there and fight them and raise money to actually rein them in. I have been doing that for well over a decade and have garnered more than 49 percent of the vote twice with almost no money on my side.

    We suffer under the unions’ iron hand because we choose to. We could have taken them down several times, but the business community has sat on their hands and complained that our side couldn’t win because Sizemore was involved. With my name on a measure and $12 million spent against us, our side still garnered 49.6 percent of the vote. This should disprove the theory and yet once again there is no support for a measure to fix this problem. And it is worth mentioning that this time the measure doesn’t even have my name on it. Nonetheless, the business community is apparently going to sit on the sidelines and let the OEA and friends continue to kill us. As I said, we do this to ourselves. The solution is right before us and yet no one wants to face the giant head on. It is easier to simply talk about it.

    • Steve Plunk

      I agree the the business community has been negligent in recognizing and understanding what threats the public sector unions are. My experience in the local Chamber of Commerce was eye opening. The leadership was more concerned with their own reputation and prestige in the community as great guys or big supporters of public projects. They seldom looked at the big picture or spoke up about runaway PERS costs or rising inefficiencies in the public sector. Before long it was clear most C of C’s were social clubs more than organizations minding business interests.

      The public sector will do whatever it needs to do to maintain growth. If that means killing Oregon business then so be it. The sooner we all realize how dangerous they have become the sooner we can start taking this state back from them.

    • Jim Ray

      I agree with you Bill! All these people who whine, piss & moan after the fact just prove the fact that Sizemore has “the hair on his ass” that guys like Huss do not.

      BTW, two guys overheard at breakfast yesterday in Beaverton. Both out of state head hunters, not for employees but for COMPANIES. They’re licking their chops!

    • davidg

      Bill, I think you are right about the timidity of Oregon voters and its business community. We’ve had the chance to do something about this and didn’t. That’s discouraging, but it doesn’t mean things are hopeless.

      I lived in California during the 1960’s and 1970’s through the run-up to the famous Proposition 13 campaign. The public was slow to recognize the need for tax reform. Throughout the 60’s and 70’s there were a number of major tax reform initiatives on the California ballot. All were defeated – until voters finally got alarmed at their continuing property tax increases. In 1978 Proposition 13 came along and passed by a two to one margin.

      The public is often slow to recognize danger and just as slow to act. But I think the era of reining in the public employee unions is coming in the near future. The financial distress or collapse of state and local governments will be the precipitating cause.

    • Ron

      Bill,

      What are the particulars of this measure and where can we go to support it ? My means are meager but if the unions continue to take from me, I may have no means at all.

    • retired UO science prof

      I find myself in the weird situation of agreeing with Sizemore here. The timid Oregon business establishment has not had the guts to try to take on the unions. So, they get what they deserve.

      • Rupert in Springfield

        Oh good lord, you saw an opportunity to blame business for something and took it. Hardly a fluke or a weird situation at all.

        If you had actually blamed the unions for abusing their position rather than blaming business for not stopping them, now that would have been something.

  • John Fairplay

    It will be interesting to see if the Measure 66/67 results open business’ eyes on these issues. There was a lot of brave talk a few months ago about a “new coalition” that would stick together after the election, but it remains to be seen. As Bill notes, business has been acting against its own best interests – adopting essentially a “go along to get along” attitude – for decades in Oregon. 66/67 show the results of that strategy.

  • valley p

    “The affairs and services of government were too important to be disrupted by strikes of (sic) other labor activities.”

    Wow…knock me over with a feather. I never thought I would read on Catalyst that public sector services are more important than private industry. But what else can one conclude? It is ok by Larry for private sector workers to unionize and strike, because who cares about the private sector? We can live without it I guess. If they stop making new cars for a while we can drive our old ones or walk. But public sector services? Teachers, police, fire fighters, sewage plant workers, highway engineers….all too important to be allowed to unionize and perhaps strike? The wheels of civilization would ground to a halt?

    Say it aint so Larry. Or you will be banned from further posts here.

    • Steve Plunk

      Poor logic once again on display. If the county offices are closed a builder can’t get a permit to start work. If the DMV is closed it inconveniences the public. If city hall is not open how do I get a business permit? You see the reason it’s important they stay open is because of all of the rules and regulations they impose upon us. If they close it’s not what they do for us as much as what they require of us that can’t get done. Without government being such a self licking ice cream cone we could do without much of it.

      • Anonymous

        I’m not disagreeing with anything you’ve got to say, Steve, but as a finish carpenter I can tell you that without government enforcement of building codes me and a lot of other guys would be out of work. Folks would be a lot less willing to pay us for our skills if they felt (rightly or wrongly) that they were capable of doing the work themselves. Not to mention that there would be a whole heck of a lot more shoddy craftsmanship (e.g. dangerous staircases etc) out there. Just felt the need to mention that.

  • Pinkie

    You know I have always wondered. Why is it the DEMOCRAT party gets all, if not the lions share, of the campaign donations from the UNIONS. The democrats in turn hold a gun to the kids heads every single time they demand more money…and the UNIONS pony up for the “fight for the kids” battle with the VOTERS, all the while no one notices it was the DEMOCRATS that pulled the gun and are holding the ‘kids’ education hostage…

    Next session…UNIONS GIVE BULK OF MONEY TO DEMS, and the process repeats.

    Does anyone besides me think…THEY ARE WORKING TOGETHER ON THIS?

    Either UNION members are really stupid…or they are working together.

    • r UO sp

      My post was not about the unions or whether they are good or bad or whom they support — it was about whether Larry Huss is a good anti-union spokesman. I think he’s a good exhibit of why you guys usually lose. A corporate fat cat — from central casting! — talking about the corrupt, overpampered public workers. The unions must love having opposition like this!

  • retired UO science prof

    Always amusing to hear the thoroughly mediocre former head of USWest in Oregon, Larry Huss, complaining about public worker health plans and pensions. What was your health plan like, Larry? What is your annual pension?

    Pension and health benefits may be too high for public workers, or they may not, but Larry Huss is a preposterous spokesman for cutting them.

    By the way, Larry, did you have a chauffeur? A corporate jet? Did you fly economy class, like public employees do?

    • Rupert in Springfield

      One can only hope that you had a more mature attitude in making an argument in class than you present here. This is first order sillyness – the idea that only the absolutely pure can ever raise disagreement with a perceived wrong.

      If you believe in your position, be my guest, however I sure hope you gave every student an A in every class they ever took.

      After all, unless you were pure as the wind driven snow you were in no more a place to judge your students than Mr. Huss is to write a simple commentary.

      For a public university professor to be going on about a private sector persons retirement is the height of absurdity. At least people had a choice whether to contribute or not to Mr. Huss’s retirement, he was a private employee. You on the other hand got your retirement through tax raises at the point of a gun.

      Your retirement is hardly an alter to purity, so you might want to pipe down with all the high horse stuff. Its really a bit absurd. Thanks.

      • r UO sp

        I got my retirement at the point of a gun? And I thought all I had done was sign a contract when they recruited me to your fair state!

        If you’re that much against public universities in Oregon — though UO is just barely public these days — go ahead and campaign to have them disbanded. Perhaps this year’s Republican candidates will hire you on as their Karl Rove.

    • Pinkie

      So will you please tell me Professor…Why do the UNIONS give the bulk of their money for campaigs to DEMOCRATS? Why, when it is always the DEMOCRATS that pull out the gun and hold it to the head of the child? Why? And the cycle repeats.

      PERHAPS, if we took away union power in that way, we could take back the state and FORCE the DEMOCRATS to fix the funding problem. YOU SEE, Professor the problem is still there. Nothing was fixed with 66 & 67. NOTHING.

      So, again, why do the unions give their money to the people that pull the gun everytime? Please Professor, I will wait for your anwswer.

    • Steve Plunk

      I know I’m not paying for Larry’s pension with my tax dollars and I also know that pension was negotiated in good faith rather than between two parties with similar interests and playing with other people’s money. Professor, you really can do better (of course you can’t ever win).

      • Rupert in Springfield

        >rather than between two parties with similar interests and playing with other people’s money.

        You damn sure got that right.

        If you are feeding at the rough, slop it up, but please don’t get on a high horse about it.

      • r UO sp

        Yet you send your son to — an Oregon public university! One of the ones which, by the way, has very high relative costs per degree granted.

        Why don’t you campaign against pensions for public university professors? You’ll make it easy to recruit faculty to Oregon! Oh, I know, you think it’s easy.

        Maybe you should apply to teach accounting courses at SOU, I’m sure the great income boost would be welcome, no?

        As for the negotiations for MY pension — I signed the contract they offered me. That was all I had to do with it, HONEST! I took the deal they offered me. Maybe I should feel like a skunk, but I don’t.

        By the way, I suspect Larry had much more direct negotiations with USWest about his pensions. And in all likelihood, you WERE forced to pay for his pension, if you had phone service then. Regulate monopoly and all that.

        You actually have FAR MORE choice in higher education in Oregon than you had in phone service back then.

    • Anonymous

      Well, guys, if you think Larry is a good spokesman for the anti-union cause, send him out there! He and Bill will make a dandy team.

      By the way, a regulated monopoly especially as USWest was then is hardly a poster-boy for “private eneterprise”.

      No wonder you do so well in elections among the students!

      Maybe you can enlist some high bonus Wall Street types — Goldman Sachs anyone? — to help you make your case.

  • Tom Cox

    Reading this story about Hunt’s hardball tactics:

    http://bbedit.sx.atl.publicus.com/apps/pbcs.dll/article?AID=/20100217/NEWS0107/302179999/1009&nav_category

    I suggest this be opposed by an equal level of seriousness on our side.

    • Tom Cox

      I should add that we should operate ethically and within the law — thus differentiating ourselves from Hunt.

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