Step One: state politicians promise big pension and health care benefits to their unionized work forces, but don’t set aside enough money to fund those benefits when the bill comes due. This makes union leaders and unions look good, because they can point to the shiny new benefits they have negotiated with the politicians. Meanwhile, it makes the politicians happy because the unions support them with contributions and volunteers at election time, but because the unions don’t insist on full funding for the benefits, the politicians don’t have to raise costs or otherwise disturb the big majority of voters who don’t work for the government.
http://blogs.the-american-interest.com/wrm/2012/06/25/time-to-occupy-the-pension-funds/
Regular federally backed unions are bad enough - they punish workers by preventing those workers inside the union from having to compete for their jobs against workers outside the union - even if those outside could do a better job, or do the same job for lower cost, or both. Some win, some lose, but the coercive monopoly on labor chooses which gets the bad deal.
A government union doubles down on this perversion - it empowers some workers to use political rent seeking to get the state to coercively extract tax money from other workers - and other "non-workers" as well - to send to the union members. How could this possibly be considered even remotely justifiable?
Let state workers do what everyone else does - come to work if they think the pay and benefits are worth the life energy that must be exchanged to gain those benefits. Why would such a group of "public servants" need a union? Work for the state or get a better job - that's not a formula for injustice to "workers" it's natural law and the human condition.
But that's not as bad as it gets - it also feeds our current state of crony capitalism, in which profits may be had by feeding the political cycle much like unions do; backscratching all around.
Pension reform is about more than cutting benefits to realistic levels, and ensuring that politicians and union leaders have to stop the collusive scams. It is also about enabling pension funds to invest in safer investments and stop paying huge fees to hedge fund managers and investment banks — and because public pension funds are such large pools of capital, this would be an effective way to help bring Wall Street back down to earth.
The conclusion:
This is not a pretty sight, and the whole mess is a strong argument for those who believe that “regulatory capture” means that a powerful government ends up serving the rich and well-connected rather than helping working and middle class Americans. Transforming what ought to be a safe and reliable pension system into a Wall Street boondoggle is exactly the kind of thing a serious labor movement would fight. That the public unions are in effect fighting to retain the “freedom” to put worker pension money in high risk, high fee assets is an indication of just how intellectually and politically bankrupt much of the American public sector labor movement has become.
http://blogs.the-american-interest.com/wrm/2012/06/25/time-to-occupy-the-pension-funds/
Regular federally backed unions are bad enough - they punish workers by preventing those workers inside the union from having to compete for their jobs against workers outside the union - even if those outside could do a better job, or do the same job for lower cost, or both. Some win, some lose, but the coercive monopoly on labor chooses which gets the bad deal.
A government union doubles down on this perversion - it empowers some workers to use political rent seeking to get the state to coercively extract tax money from other workers - and other "non-workers" as well - to send to the union members. How could this possibly be considered even remotely justifiable?
Let state workers do what everyone else does - come to work if they think the pay and benefits are worth the life energy that must be exchanged to gain those benefits. Why would such a group of "public servants" need a union? Work for the state or get a better job - that's not a formula for injustice to "workers" it's natural law and the human condition.
But that's not as bad as it gets - it also feeds our current state of crony capitalism, in which profits may be had by feeding the political cycle much like unions do; backscratching all around.
Pension reform is about more than cutting benefits to realistic levels, and ensuring that politicians and union leaders have to stop the collusive scams. It is also about enabling pension funds to invest in safer investments and stop paying huge fees to hedge fund managers and investment banks — and because public pension funds are such large pools of capital, this would be an effective way to help bring Wall Street back down to earth.
The conclusion:
This is not a pretty sight, and the whole mess is a strong argument for those who believe that “regulatory capture” means that a powerful government ends up serving the rich and well-connected rather than helping working and middle class Americans. Transforming what ought to be a safe and reliable pension system into a Wall Street boondoggle is exactly the kind of thing a serious labor movement would fight. That the public unions are in effect fighting to retain the “freedom” to put worker pension money in high risk, high fee assets is an indication of just how intellectually and politically bankrupt much of the American public sector labor movement has become.
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