Commentary
11:04 am
Wed July 27, 2011

State Employee Unions and Contract Negotiations

There are many fewer state employees now than there were thirty years ago, but the total is still nearly fifty thousand. Most of them are union members, and contract talks are now underway between their unions and the Snyder administration.

Negotiations aren’t likely to be easy. The governor wants a new contract that will save $265 million dollars, or about six thousand dollars per worker. The administration says we can’t afford to maintain the level of benefits they’ve been getting.

The unions sharply disagree. So -- who is right?

For many years, the great bargain has been that public sector workers traded high salaries for secure jobs with good benefits.  A few years ago, a former student of mine talked to me about her husband, who just then was getting an advanced degree in economics. He was a very intelligent and capable man.

He was also a hard worker, and wanted to have children. But the husband wasn’t entrepreneurial. He preferred security to the chance to make a lot of money. He had thought about becoming a stockbroker, but didn’t want the pressure.

What, she asked, did I think he should do about a career?

The answer seemed very clear. The husband ought to look for employment with the government, I said. He wouldn’t get rich doing that, but he’d make a adequate salary. The benefits tended to be excellent and there would be a great deal of job security.

Well, I never found out what happened to him. And I’m not sure I’d give the same answer today. Government workers at all levels are under siege. Many of us think that they are overpaid, underworked and get too many Cadillac benefits in a shrinking economy.

Some in the legislature seem to positively relish the thought of socking it to anyone in the public sector. At the same time, the leaders of some of the public employee unions seem oblivious to what’s happening in our state and our economy.

That was clearly evident a year ago, when then-Speaker of the House Andy Dillon proposed putting all state and local government workers under the same health care plan. This would have made  sense, and saved the state money. But the unions got mad.

Some of their members would have had to make do with reduced benefits. So in revenge for Dillon’s heresy, they did everything they could to defeat him in the Democratic primary when he ran for governor. They succeeded. Instead, Democrats nominated a candidate who had no chance of winning, and the unions ended up with Rick Snyder and a legislature full of unfriendly Republicans.

Now that’s effective strategy.

The fact is that the economy has changed. Public sector benefit contracts were often patterned after those the United Auto Workers union achieved in its glory days. The changing economy has meant that auto workers had to make concessions.

The rest of us have to as well. At the same time, we want and need state workers to be smart, tough, and efficient. Demonizing and insulting them, on top of slashing their benefits, makes no sense.

The UAW and Detroit’s automakers now seem to realize that these are tough times, and we‘re all in this together. That‘s a sentiment that needs to spread to the public sector too.