The Unions Win Again

Governor Kulongoski has given public employees another five percent raise. The governor stated this was the result of a collective bargaining agreement. The outrage was almost immediate but by and large the outrage missed the essential problem.

There are two essential problems and they will be ignored completely by the mainstream media. The first is how the raise is categorized. It is classified as an “additional step increase.” For the uninitiated, a step increase is a salary increase that is granted for simply remaining employed for another year. It is in addition to the regular (and usually annual) salary increase.

When the public is told about the salary increases bargained for by the public employee unions, the amounts disclosed do not include the step increase. Thus, what appears to be relatively modest annual salary increases are, in actuality, compounded by the addition of the “step increases.” For the public employees unions and their supporters it is important to mask the true amount of annual raises to minimize adverse public reaction.

But it is the second issue that is the most important and which is routinely ignored by the mainstream press even though they have an undue fascination with “public corruption” – real or preceived – in every other facet of government.

In traditional labor-management relationships, there is organized labor on one side and management on the other. The unions are ostensibly beholden to their members – the employees, while management is beholden to the owners (shareholders). There is a tension that exists which is likely to result in an appropriate balance – sufficiently robust wages to attract quality workers vs. low enough wages to insure that business remains competitive in an open marketplace.

But that tension does not exist in the case of the public employee unions simply because the management structure (elected and appointed officials) are beholden to those who place them in office rather than the shareholders (taxpayers). In Oregon, the Democrat party is largely financed by the public employee unions. In Oregon, the public employees unions have a substantial influence on who is selected to run in the Democrat party. In Oregon, the current governor acknowledged during his last gubernatorial campaign on July 25, 2006, during a speech to the AFL-CIO, which is dominated by the public employee unions:

“. . . I’ve never lost sight of who I represent, and that’s you.”

In response to the substantial financial and “volunteer” support Kulongoski received from the public employee unions, he has returned the favor in spades. Kulongoski appointed three former public employee union officials to his three top administration spots – chief of staff, deputy chief of staff and communications director. He negotiated a generous wage increase for the public employee unions and thereafter secured the funding for it through the Democrat controlled legislature. He declared reform of the burdensome and overly generous PERS system off limits. Kulongoski has routinely authorized “sole source” contracts with the public employee unions which prohibits the state from outsourcing any function that was previously performed by a public employee union member thus ensuring continuing inefficiency. Kulongoski signed into law a provision that deprives public employees the right to a secret ballot as to whether to unionize and thus makes the vulnerable to intimidation by the public employee union representatives – many of whom would scare the bejeezus out of a professional wrestler.

And when the public employee unions whined about the exorbitant salary increases Kulongoski granted to his supervisors, including the three previously mentioned former public employee union officers, Kulongoski immediately folded and granted the public employee unions yet another salary increase – all of this in the space of 12 months.

The system we have in place in Oregon is pernicious at best. Men and women are required to join the public employees union as a condition of employment. They are required to make mandatory payments to the public employee unions. These mandatory payments result in over $55 million dollars being available to the public employee unions each biennium to fund political activities designed to ensure that officials like Gov. Kulongoski are elected and remain in office. By using these vast sums to ensure that people dependent on their political largesse are elected, the public employee unions ensure that those with whom they negotiate are beholden to them and grant them robust salary increases, handsome pensions, ease in imposing mandatory membership on new employees and unlimited political power. And all of this at the expense of the taxpayers.

This is a system that goes largely unnoticed and unappreciated by the average Oregonian – in part because the average Oregonian is so busy trying to put food on his/her table that (s)he cannot pay attention to the nuances of political power, and in part because Oregon’s mainstream media refuses to disturb the liberal status quo.

In the end, the public employees unions and their Democrat stalwarts will overstep their bounds – they can’t help it – power and greed are insatiable masters. But until they do, the public employee unions will remain as the single most powerful political force in Oregon and will continue to pick the pockets of the taxpayers as they have done expertly during 2007.

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Posted by at 05:55 | Posted in Measure 37 | 29 Comments |Email This Post Email This Post |Print This Post Print This Post
  • Jerry

    I sure have not overlooked it as I was once a part of it. It is nothing short of disgusting. No one should be entitled to a raise simply because they hung around for another year. What utter nonsense. Of course they have to hide the real amount of the salary increases just like the hide the actual cost of benefits. If more people knew the whole thing might come crashing down on them, but I doubt it.

    Of course Ted is giving away the store – it is not his money – so it is VERY easy to do. If this buffoon had to run a private sector company he simply could not do it.

    The forced union membership is a complete joke and only something one would expect in Russia or Cuba.

    Nothing will ever change in Oregon. The whole system is rigged and everyone knows it and no one seems to care.

    State employees have it down to a science. Great benefits, huge retirement, nice pay, short work days, short work weeks, short work years. Short change the public. Short, short, short. Short circuit common sense.

    Have you noticed – never a problem filling these do-nothing state jobs. Never.

    I am glad people like you are pointing all this out, but to what end? NOTHING is going to change in Oregon EVER. These people are very smart – I have to give them credit – for taking complete control over state government at every level, stealing money from their forced to join members, using that money to sustain the control – and all this right in front of everyone!!

    I must say, they are to be commended for so successfully duping the Oregon public. Keep the raises coming, keep the unions in power, keep the forced joining requirements – these people have earned all this through their amazing dishonesty, duplicity and mendacity.

    What a state!

  • John Fairplay

    A few years ago during the Recession (let’s pretend it’s not still going on in Oregon) the Governor boldly – and to great fanfare – froze salaries of state workers for a time. The outrage from the unions was tremendous! What will happen, pundits kvetched, when the Governor has to run for re-election? Will the government employee unions support him? They did, of course, and now we know one more of the things he promised them to get that support.

    On the positive side, the system as it is can’t last forever. No organism, not even a government, can survive if it is mostly parasites. If the host stops eating, there is nothing to sustain the parasites. As more and more productive people leave Oregon and are replaced by “creatives” and “sustainables” who look pretty but produce nothing of value, the host will begin to die. This is beginning to happen – and may accelerate – in the Counties that have become addicted to O&C timber money.

    When the current recession deepens there will be a bloodbath the likes of which has never been seen in this state. As long as voters do not stupidly allow any tax increases, some of the parasites will have to be shed.

  • Bill Sizemore

    Crying woe is me has never solved a problem. Larry has pointed out a glaring problem that can be solved. The starting place is obvious. We must stop the payroll deductions public employee unions are allowed as the means for raising all of their political funds. That is both the source of their strength and the Achilles heel.

    I will have a measure on the 2008 ballot that stops the use of the public payroll system for collecting political funds. If right thinking Oregonians will support it, we will take a giant step forward in reclaiming our state for its citizens and taxpayers. The measure polls well and fixes the problem. If conservatives cry woe is me and then refuse to support this measure, they deserve their fate.

    Larry did an excellent job of identifying the problem. And it’s a big one. But the solution is obvious and not really all that difficult to bring to pass.

    • Lt. Col. Elias Osmundo Ramirez Cervantes

      Too little, too late. I say let’s do what the CIA does to trade unionists. Slit their throats, stuff them in canvas bags and dump them in the Caribbean Sea.

      • CRAWDUDE

        Isn’t the Carribean an Ocean? And don’t they use burlap sacks?

        • Lt. Col. Elias Osmundo Ramirez Cervantes

          It’s a sea. But you’re right about the burlap. Sorry.

  • Jerry

    Agreed Bill. Stopping payroll deductions, where taxpayers pick up the bill for collecting forced union dues which are used to elect Democrats who continue to do whatever the unions want has to STOP.
    It would sure be a good place to start.

    I am very glad the O&C timber monies are drying up. It has been a gravy train for the counties to waste money for too, too long. They waste so much money on useless, redundant, foolish, stupid programs that it is refreshing to see them cut off at the knees.

    • John Fairplay

      I’m not as thrilled as you as I have a lot of friends in the timber parts of our state, and the payments are being cut off more due to the destruction of the timber industry than for any other reason. However, the County Commissioners in all the O&C counties have done a miserable job of preparing for the future. They have known for a decade that these funds were going away, and have done absolutely nothing to prepare.

  • Bob Clark

    Elected and politically appointed officials should remove themselves from public employee benefit negotiations if they have directly or indirectly received a disproportionate share of their political contributions from public employee unions. Otherwise, as this article argues, it is self dealing.

    • Jerry

      They NEVER will, though, precisely because they are effected. They are dishonest people – period.

  • Captain_Anon

    I haven’t read of the increase anywhere else but here so i don’t have a lot of informaiton. But a 5% raise does not seem extrodinary to me. Particurally, as John pointed out, that state worker salaries were frozen for a few years (in essence salary CUTS because of inflation). the 5% is on top of a Cost Of Living Adjustment, which really, when was the last time you saw a COLA actually match inflation? the feds just issued economic data that said inflation was up .8% the last MONTH alone. over 12 months thats 9.6%. so if state workers got a 3% COLA, which is unlikely, they’d still be losing ground on their salary because of inflation.

    but getting back to larry’s take on the additional step increase…. while i have seen the pay strucutre, it sounds as if there was a nother pay step added. so instead of maxing out on the salary scale after 8 years, they max out after 9 years. or instead of 10 years, they max out at 11 years. doesn’t seem unreasonable.

    I also find it interesting that so many on this board seem to think public employees get hired simply to mastermind world (state) domination. as if they dont’ have jobs to do? as if each and every one of them joins the public ranks to get some ‘power’ and free hand in the state treasury? i mean, c’mon. how unrealistic is that? DOT road crews join the state so they can steal money rather than repair Highway 30? or DHS caseworkers join so they can have slave labor? no, they join because they care about abused kids and know they need an advocate.

    those who think state workers dont’ do thier jobs and are on board simply to run a kingdom need a reality check


      While I won’t begrudge the pay raises for employees, 2 pay raises in a year is over the top………………..any non government employees ever have that happen to them?

      I’m trying to remember if the year the wages were frozen was the year the Oregon Supreme Court ruled it illegal to not charge the employees an income tax. If I recall, the governor at the time gave all employees a 6% raise to cover the ruling and all future taxes. Of course, it was really a raise………then again I guess it all depends of what your definition of raise, is. Ala Bill Clinton….

      • Captain_Anon

        my understanding is that there were two times that salaries were frozen. public employees agreed to freeze raises for a period of time in the 80’s as part of barganing. the give by the government was they woudl contribute to thier retirement ala PERS. but it was the same percentage exchanged. so instead of salary, they got retirement. then again in what, 2001-2004 or 5? the gov froze all pay increases (salaries and cola’s i believe).

        i’m unfamiliar with the court’s decision on public employees not paying income tax. as far as i know, they all do.

        • CRAWDUDE

          Thanks for setting me straight on the dates, the 80’s period I would have known about.

          The deal with the income tax was that PERS retirees did not have to pay it at one time but the state did collect it from Federal retirees. I found a report on it:

          What they did back then was give all retirees and current employees a 6% raise to cover the tax or eventuality of it. Yet, claimed that it was a freeze………the current employees got 6% since they were already paying income tax………..not much of a freeze.

          I don’t believe in balancing budgets on the backs of your employees, a little financial restraint can do that. At the same time 2 raises in one year is beyond the pale also. Regardless, it proves that the liberal politicians especially Ted are in the pockets of the public unions.

  • Dogman

    I agree w/ Captain that most workers do their jobs. But what needs to happen the control over the goverment needs to go back to the taxpayers. We have some state goverment workers that abuse their power, because they can. I beleive it is the class of state workers that received a higher pay raise that just a worker with creditbility. As we know the supervisers. That go to work and dictate policies they beleive is the good for themselves.

    I beleive Bill S has the right way of the people taking back the control to the citizens, not the fat cats recieving money just to put into office the clonies that run this state. Without money they can not force anything on us, or make use beleive they are doing this for us citizens

  • Common sense

    Larry thanks for using that picture of sleepy ted it is appropriate and my favorite for the subject. It looks like the face of a man getting a rectal exam by a mad gorilla. But it really is just the union giving him his daily therapy. Billery please take him off of our hands and make him a monkey in your circus.

    • Dogman

      I hope the taxpayers of Oregon is not paying for his trip. I don’t like the ideal of him going and representing Oregon. I beleive we should have a voice if the govenor can represent us in the elevtion of Clinton.

  • Right thinker

    Captain Anon has shown his true colors:
    -5% is not that big?
    -inflation is 9.6%?
    -step increases are not so bad?

    Captain, you are either very deceived or intentionally deceptive.

    No private sector company is paying 5% increases. Oh, you say that is to overcome the wage freezes? Private sector companies laid off people instead of wage freezes. How many public employees were laid off? Zero. The Unions screamed bloody murder when they had to cut open job reqs.

    Inflation is not 9.6% annualized. The economy is slowing down, the housing crisis is spreading to the rest of the economy. We are in the beginnings of a recession.

    The step increase pays additional money for EVER. The employees did one thing to earn this increase: they fogged a mirror! No additional education; no additional training; no additional performance; no additional hours or days worked. Nothing. Zip. Nada. Just because they showed up for another year, they get an additional step up the ladder. In addition to COLA. In addition to their salary increase.

    This is the reason schools are over crowed, and class sizes are sky high. NOT because there is no money for the kids. But because the money that is available is going towards paying the existing teachers lavishly, and leaving no money left over for ADDITIONAL teachers.

    OEA’s motto:
    Existing Union Teachers First!! School Kids Last!!

    • Captain_Anon

      based on your comments, you didn’t read what i said at all. You also put words into my mouth i didn’t say, and make very painful reaches to come to your conclusions, without facts.

      5% is a good increase, no doubt. but it’s not outlandish. in the private sector, people get raises within a wide range. My fiance received a 10% raise last year. other places of work offer comparable wages. it probably depends on what sector you’re in. additionally, most employees of private firms get a bonus every year at the end of the year. many to the tune of 1-10 thousand dollars (again, industry dependant). I’d like to see you back up your claim that no private sector jobs are giving raises of 5% or more. I also didn’t say the raise was because of the pay freeze from before. you said it was correlated to that.

      the index on inflation showed that prices (CPI) increased 0.8% last month alone. times that by 12 and you get 9.6%. that’s basic math. Additionally, whole sale prices rose 3.2% in ONE MONTH. here is where you can read the article on how prices and inflation are speeding up while the economy is slowing (Stagflation – remember from the 70’s?) ( Energy prices ALONE, went up 5.7% in the month.

      and yes, adding an additional step to the pay scale isn’t a bad idea to me. in the private sector, people get raises every year. in most government jobs, it is capped at 8 years. some contacts have 10 (teachers have the largest number of steps that i know of). most public employees are required to get training of one form or another. in fact, teachers are required to get a masters degree – at thier own expense. Again, i’d like to see proof from you that no public employee has 1. gotten training, 2. hasn’t taken corses or classes to improve their education and 3. improved efficiency or perfromance.

      and lastly, i would say our schools are overcrowded because we allow illegal aliens to take privledges and resources that do not belong to them. get rid of them, and that frees up a lot of classroom space.

      i look forward to your documented facts.

      • CRAWDUDE

        The last figure I saw stated the educating children of illegal aliens cost the Oregon taxpayers approx. 491 million per year.

        The answer to many of the budget shortfalls in this state and country for that matter are the result of funds being used to benefit illegals. Send the home 🙂

      • lw

        Here’s a fact, Anon. Legacy Health System’s cost of living increase this past year was less than 2%-80% less than public employees. Do you have many friends in the private sector that you can begin asking to substantiates your claims. Where are your sources that “most employees of private firms get a bonus every year”? It seems that you work in the public sector. I’ve worked in both and your claims are false.

        • captain_Anon

          as a matetr of fact, yes. i know many at intel, a garbage company in portland, several in real estate and seceral at nike and other garmet industries in the area. all get bonsuses (unsure about this year, but i’m assuming they will since they always do). all got raises higher than the cost of living.

          ifyou’re referrign to retail and bottom level/entry level jobs. you’re probably right. those who wok at the mall or fast food joints probably don’t get a bonus. but the skilled laborers, typically do.

          my question about legacy’s COLA is 1. was it given uniformally to all staffers? nurses, doctors, admin staff, janitors? or did each class get a different cola? and 2. was there ALSO a step increase or other raise also granted? many in the hospitals are represented employees and have a very similar pay structure to the government unions. i know lots of tradesmen who get cola’s AND raises. and my sister, who works at Fred Hutch cancer research center in seattle got both a cola and a raise of 5%. Not only is it private, but its non-profit.

          • CRAWDUDE

            The suggested Federal raise this year is 2.5% which is inflation 3.5% minus 1 point.

            Though the formula you used looked nice but businesses, financials, unions and state governments (including Oregon) use the Federal rate, which this year is 3.5%.

            Along with their earlier raise this year, the PERS employees are enjoying as 8+% pay raises this year. More than double the the inflation rate……………………once again I ask : Who else on here or do you know of , outside CEO’s and professional athletes got an 8% raise this year?

          • Captain_Anon

            i wasn’t aware there was a suggested federal cola rate. That being said, i know that the feds normalize thier salaries based on local economic factors. a G-10 in california will make more than a G-10 in Idaho colorado. Cola’s and step increases are all negotiated in the contracts. I posted several school districts contracts a long time ago. while looking at those, it notved the step increases and i believe the cola’s. the best way to figure out the raises are to look up some more i suppose. but i don’t agree that ALL gov employees receive the same cola or step increase amounts. that being said, if inflation was 3.5% (which it was actually over 4% as i heard on the news) and the total raise of say employee A was 2.5% cola and 3% step increase, that would be only a 1.5% raise over inflation. if employee B had a 2.5% cola and a 5% step increase, that would only be 3% over inflation. i still don’t see that as an extravigant raise. and like i said, my fiance got a 10% raise last year and a Christmas bonus. those i know at Intel usually get between 3-10K bonuses and raises over 5% or more too. not sure of the raise percentage numbers of my nike friends etc.

          • CRAWDUDE

            True but you are only referring to the GS force, known as white collar employees. They do recieve on occaision a locality pay increase / decrease due to their geograhpical region.

            WG or Wage Grade employees (blue collar) recieve only the yearly COLA increse which is normally the national inflation index though in times of economic down turn the Prez. can decrease it by a point.

            The above was just FYI trivia, the main point I was bringing up was the 3.5% as opposed to your 9.6% but it was a very fair point that made about the locality pay increases.

            As for the bonus’ some companies give, I think they are based on the profits of that company. I think I can safely say that most Oregon tax payers don’t work for large corporations and undoubtedly don’t recieve such bonuses.

          • anon

            That pure falsehood. Not everybody at Intel got bonuses. Nor at Nike. Nor at most private sector jobs. And raises in the private sector this year ranged from 0% (that is right, no raise) to 1-2%, with a few getting 3-5%.

            Just cause you pull figures out of your a$$ does not mean they are real numbers.

            And you never addressed the above comment about layoffs. How come? Perhaps because unions avoid layoffs, even when there is no business to support the level of workers. Just keep the workers around, since it is ‘only’ the taxpayer’s money, who cares? That is the union mentality, and it sure sounds like it is the Cap’ts also. So sad.

          • Captain_Anon

            you’re right on one count. not everyone gets raises and bonuses. i never said that. However, at intel, everyone i know who works there DID. intel has an interesting system where each year, the entire work force has to compete against each other – to a ruthless point. because what is it, 25% have to reapply for thier jobs? they have a name for the process and evryone there hates it. there is a bonus system based on the results of the rankings. those at the top get big bonuses those in the middle get middle, lower tier get less and the bottom get fired. even if everyone is amazing, they WILL fire the lowest rung. who can then reapply for the job. each person must point out all thier accomplishments and how they contribute. its dog eat dog and a few i know have lost friends simply because of back stabbing in the process. its brutal. AT INTEL. not every place is like that. the product developers i know at nike DO get bonuses.

            I”m curious where you get your numbers about raises? are you talking across the board? the broad eomplyment market? because as i said, those who work retail and fast food, will get a minimal raise. so sure, they will pull the average down. and those companies not doing well, may or may not get a raise. but skilled labor, the majority DO get raises. at least those i know in portland, seattle and spokane. the figures arent out of my ass, they are based on 1st hand knowledge.

            Which comment on layoffs are you talking about? are you “right thinking” and refering to the comment: *”No private sector company is paying 5% increases. Oh, you say that is to overcome the wage freezes? Private sector companies laid off people instead of wage freezes. How many public employees were laid off? Zero. The Unions screamed bloody murder when they had to cut open job reqs.

            first, many companies are paying more than 5% increases. second, many private firms that are going under laid off people and many froze wages. the airlines and auto industry come to mind as some that froze wages or rolled them back rather than fire people. some were also let go. and your completely wrong about no pubic employees being laid off. its clear you’re not working with any real data or knowledge of what has been happening the past six-8 years in oregon. multnomah county has let over 400 employees go the past i dunno, 6 years (here’s an example : At least 13 employees with Multnomah County Health Department will lose their jobs due to budget cuts. The Southeast 34th Avenue clinic, which employs about 30, will close at the end of the month. Remaining staff will transfer to other clinics in the county’s health system., portland public schools has let hundreds of tradesmen go, teachers go, middle management go,… portland state let public employees go, the city of portland has laid many off and also not filled vacancies. the city of gresham has let employees go. The city of Bend just released this press release: Citing “enormously” decreased revenues caused by the steep downturn in local building industry markets, The City of Bend announced this week its intention to lay off ten employees. ( City of Astoria has laid off workers:, jackson county has been letting employees go and closing libraries.

            i really wish you would get some knowledge of what’s going on and some facts before you just spew information that makes you completely unbelievable an irrelevant to the discussion.

        • Captain_Anon

          lw, are you saying public employees got a COLA of 10%? a Cola of 2% doesn’t meet inflation but is around most public employees that i’m aware of. the ranges i’ve hearf for COLA’s are 2-3%

  • Jerry

    OEA’s motto is actually this:

    We run the state
    and won’t hesitate
    to do what it takes
    to cover our mistakes
    even as we rakes and rakes
    ill-gotten gain from forced rates
    of union dues from teachers’ plates.

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