State governments around the nation are experiencing a budgetary crisis. New Jersey Governor Christie wants a pay freeze on state employees and teachers. For those of you around the United States that ain’t nothin’ compared to what Wisconsin Governor Scott Walker is doing. Ostensibly, this is all to balance an over three billion dollar state deficit. That is partly true but in reality it is good old Union busting on a grand scale. National media outlets should really jump on this story from Wisconsin. Walker is the most anti-Union Governor in the nation at the moment.
In Wisconsin public sector workers have had collective bargaining rights via state law since the 1930’s. In fact Wisconsin led many states in first providing collective bargaining rights and fully recognizing public sector unions. It is a great tradition and indicative of the great heart and progressive nature of the state. Not any longer. A large state Budget Repair Bill introduced this past Friday and to be rammed through the State Legislature next Wednesday goes beyond making budget cuts to taking away these collective bargaining rights. As the more perceptive will realize immediately, collective bargaining rights are not budget cuts. They are blatant attempts to destroy Unions.
Hundreds of thousands of public school teachers and state employees minus police and firefighters have been asked to step up to the plate and help balance the budget. They should. But this goes beyond making a contribution in that direction. These people would have their pay and benefits cut 15 to 20%. They would all be permanently on probation at work. Even private sector workers often get off a probationary status after six months or a year. These people never will. While the shell of collective bargaining rights remain in place, the right to bargain the hours they work, and the conditions they work in will be denied to them. They can get up to the cost of living for a pay raise but it could be bargaining to below that. And, if somehow won, it must be submitted to the public for a referendum. While that last part is appealing to non-public sector workers and citizens it makes a mockery of being able to bargain this at all. Effectively, collective bargaining rights are gone.
Public sector employees are being required to pay 5.8% of pension contributions from the state and their employer and at least 12.6% of their health insurance premiums. To long suffering private sector workers this sounds eminently reasonable. Perhaps if just one of these two provisions were the entire bill, it would be. But this will take thousands of dollars out of their pockets each year. It is not unreasonable for state employees and the over 98,000 teachers and education professionals in Wisconsin to be concerned about this. Anyone would be if it were happening to them.
But one thing not considered in the rush to balance the state budget is the impact the take aways in pension and health insurance costs to employees will mean for the economy of the State of Wisconsin. Walker has come into office not just promising to tackle our state’s budget deficit but to improve the job picture in the state and get our state’s economy moving. As he took office Governor Walker threw away over a billion dollars in Federal aid and stimulus money as an austerity measure. But this was Federal and not State money. And it was going to be spent by the Obama Administration in any case. It meant 4,800 jobs for the stimulus project itself (high-speed rail) and any number of ancillary jobs created by the stimulus in Wisconsin. The big excuse offered for rejecting this largesse was that it would cost $7.5 million to operate the high-speed rail line when it was built. But a provision of the stimulus package program already put in place by the outgoing Doyle Administration included having the Feds pick up 90% of this cost too!
Walker has been Governor for less than two months. He is a fast worker when it comes to cutting economic development and consumer demand in the State of Wisconsin. The Institute for Wisconsin’s Future has studied the economic impact of Walker’s plan for public sector employees. Anyone who is anti-Union and loves to see public employees and especially public school teachers kicked in the teeth at every opportunity should pay attention while we watch the Governor shoot our state collectively in the foot while doing his thing to public workers. In the summary of their report, the Institute says:
“This analysis shows that the proposed cuts in public worker compensation would lead to the loss of $660 million a year in economic production in the private sector. It would eliminate $46 million in property taxes or shift them to other taxpayers. It would noticeably increase the state unemployment rate.”
What does Wisconsin’s state government Legislative Reference Bureau have to say about the economic impact? The numbers might not exactly coincide with the IWF Study but the basic verdict would be the same: taking discretionary income at thousands of dollars apiece for hundreds of thousands of workers in the state who happen to work for local or state government in Wisconsin will harm small businesses of all kinds and any businesses that depend on these people to buy goods and services in Wisconsin. It’s that simple. The people ramming this Budget Repair Bill through the Wisconsin State Legislature have not thought this through.
On a human scale we can well imagine this. You operate a restaurant on main street in your town. It is the county seat and near the main schools in your community. Lots of public sector workers have lunches and sometimes dinners and even breakfasts at your place. Business has been a little slower but these folks are loyal customers and they have been shielded somewhat from the recession/depression and they come in a lot. Now, they will come in far fewer numbers. You now have to lay off a couple of bus boys and one of your best wait staff. And the hiring of a couple of new people you were planning to do goes right out the window. Even your bottom line looks dicey now. That is what this bill will do all over the state. Have Wisconsin state legislators thought of this? Have even small business owners in the state realized this yet? Probably not. The Governor unveiled the plan last Friday and will sign it within a week.
That brings us to another aspect of the problem that citizens in Wisconsin should be taking note of. This is a huge change taking most or nearly all of public employees collective bargaining rights away from them. It also is a huge decision about not just the state budget but the health of the state’s economy in terms of the need to maintain and even enhance consumer demand to create and maintain jobs in the state. If you voted for Governor Walker for more jobs and to keep your job think again. This is a very unwise measure if you are concerned about anything more than balancing the budget on the backs of state employees and hitting public sector employment hard.
And it is bad government. Changes in state statutes on collective bargaining and so much more should not be pushed through in a week. There should be full state hearings and the people of the state given more time to understand what it is the Governor is proposing and what effect his proposal will have beyond its budget balancing positives. You can’t have proper legislative committee hearings on this bill in one week nor can people who are hurt by this let their voices be heard. That is what Walker and the Republicans in the legislature are counting on.
And just who does Governor Walker and state Republicans represent? Of course the answer is all the citizens in their districts and the state. But here Walker is acting like “somebody else’s governor.” If this bill passes in its present form and very quickly, Wisconsin citizens will have a full positive litmus test that the Republican Party in the state is bought and paid for by corporate interests and individual middle class residents as well as the poor and even small business in the state are left out of the political loop.
These coming days will be stormy ones. Public sector employees will not take this lying down. And they should not. Let’s watch Governor Scott Walker, Republican from Wisconsin, “somebody else’s governor.”