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February 25, 2010

From the Garden to the Ocean

Justin Katz

One must suspect that Ed Achorn is link-seeking when his column addresses both state-government dependents and the state of my youth, New Jersey:

Ultimately, while the public-employee unions and other government-fed special interests keep fattening up, the middle class suffers from a loss of jobs and opportunity, and the poor suffer from a loss of charitable dollars. The quality of life goes down, as money to pay for vital government services disappears, leaving a state with poor roads and bridges, aging school textbooks, leaking roofs and canceled sports programs, while the politically connected demand the same plush benefits they have long received.

In the comments to my Sakonnet Times letter, a teacher is claiming that he can't possibly survive with a 5% cut. The disconnect from what the rest of us have been experiencing is palpable. There's just not much more my family can cut from its budget, and nothing more we can trim and still justify living in a state that won't recover from its economic slump for years to come.

We have to turn things around quickly, in Rhode Island, because the downward spiral is self-propelling; the faster it goes, the faster people will leave, and the faster it will go. It isn't a matter of whether public-sector employees can afford a cut. If current trends continue, the cities and towns and the state will find it more difficult to pay them every year.

Comments

Don't hold your breath waiting for the public sector unions to "get it."

The union leadership affiliated with the statewide / national keeps their jobs only so long as some form of union local remains in place -- and so long as that is true, like politicians, they only have to appeal to a plurality of the vote to maintain their position.

Invariably the local leadership has seniority, and so is more interested in maintaining its / their own pay and benefits than those of the younger members.

So when things get really bad, the younger members are let go (in seniority order) rather than significant cuts in pay and benefits across the board.

The union leadership then only has to appeal to a plurality of the voting members that remain employed and so remain union members, not those who are gone.

They do this by maintaining the above-market pay and benefits for those who remain, and who bet that they'll not be let go before retirement, as the cuts to more junior members continue year after year.

This dynamic can continue for decades. Just look at the UAW -- its pay and benefits remain way above market, at least for those who remain, even as hundreds of thousands of UAW members have lost their jobs (never to be replaced) since the UAW's peak around 1979. In turn, those who remain know that they can never replace the sweet deal they have with the union, so they hang onto that life preserver with dear life, even though it'll prove to be about as effective as life preservers on the Titanic.

So one shouldn't expect economic rationality from those who remain within the union ranks. Up until now the public sector unions have remained on an idyllic island isolated from the forces battering their private sector "union brothers and sisters." But the waters of reality are now rising, and those rising waters are now lapping at the doorstep of those public sector beachside villas. The waters of reality are going to continue to rise as the scope of unfunded pension liabilities and retiree healthcare liabilities hit home with the average taxpayer ...

Posted by: Ragin' Rhode Islander at February 25, 2010 10:53 AM

Justin,

I want you to run for Loughlin's seat. You can win it hands down and we need you. Please call me 301-1018

Posted by: Sean Gately at February 25, 2010 10:56 AM

Justin,

I want you to run for Loughlin's seat. You can win it hands down and we need you. Please call me 301-1018

Posted by: Sean Gately at February 25, 2010 10:56 AM

Great idea, Sean. I agree with you. Justin definitely has the right stuff.

As an alternative, I'd love to see someone buy the Projo and convert it into a real journal of political analysi, with the AR team in charge of editorial policy.

Posted by: BobN at February 25, 2010 11:09 AM

RUN JUSTIN RUN

KATZ for the GA!!!!!!!!!!

Posted by: Sean Gately at February 25, 2010 11:19 AM

Problem is, the public sector unions don't have beachside villa's, they are the very middle class people who Ed Achorn continually attempts to portray as the elite. Simply not true. What is true is public sector employees have better benefits than many private sector employees, and that has driven a wedge into the middle class population that the true elite use to their advantage. Divide and conquor, or at least baffle the masses with BS.

If universal healthcare ever becomes reality, and if defined benefit pensions are converted into 401 K's there will be nothing left to draw attention from the fact that anybody with any real money has more tax loopholes and advantages such as vacation homes and luxury vehicles written off as business expenses and on and on than most realize.

Posted by: michael at February 25, 2010 11:27 AM

Jeez, Michael, you have suffered an enormous amount of Marxist/Progressive indoctrination in your life.

Posted by: BobN at February 25, 2010 11:44 AM

"[T]hat has driven a wedge into the middle class population that the true elite use to their advantage. Divide and conquor, or at least baffle the masses with BS."

The only B.S. is that there is some elite class controlling the media and the masses from behind the scenes, Michael. The obvious problem with your story is that Bill Gates and Steve Jobs never coerced tax money from anyone like public unions do, they earned their billions from people voluntarily purchasing valuable products and services from them. That's valuable services, to reiterate, not the crappy services public unions provide to us against our will because we fear violent reprisal if we cancel our subscriptions by withholding taxes.

From the comments:
"Just like you perceive us “unionist” as the reason your family is struggling, did it ever occur to you, that many on our side of the fence, view you and your fellow TCC buddies as a group who is trying to take food off our children’s plate? If your idea of reasonable cuts were to ever go through, I could loose my house! Am I supposed to just lie down and let you do it?????"

This guy is teaching kids? I sure hope he teaches gym. He can't even string a sentence together. A lot of my highly skilled friends are coming out of grad/law school with 100k in debt AND they have no jobs, so he can take his sob story and shove it.

Posted by: Dan at February 25, 2010 12:05 PM

Not so, Bob. My indoctrination in life came mostly from my "middle class" parents, my father being first an IBEW union man, then manager at AT&T. Both positions worked well for him. My mother worked part-time jobs, full tome mother.

My political indoctrination was formed mostly in high school, when I watched Ronald Reagan become the President of the United States and restore some some pride to the country.

Philosophically I lean toward Objectivism, the Ayn Rand philosophy made famous in her novels Atlas Shrugged and The Fountainhead.

A close friend is a CPA. I have to believe him when he tells me the richest among us pay ZERO in taxes when all is said and done and the loopholes are are manipulated. I know for a fact that the poorest among us pay ZERO in income and property taxes, and we actually pay them through earned income credits on the federal tax return.

I belong to a union and firmly believe in the princables of organized labor; the right to collectively bargain, the legality of contracts and the need for a strong voice in government, collectively, to equal the immense power and wealth of corperations and wealthy individuals whose lobbying power far exceeds all of labor combined.

I own a small business and know for a fact that the tax burden in that community is far from onerous, as portrayed in newspapers and blogs and talk radio. It cost me less that $1000.00 to incorperate, pay licence fees, pay workers compensation insurance, inventory tax and various permits. I am open for business and making money, and employing three part time workers and doing okay.

I've published a book, seen my 1% royalties add up and have paid taxes on that, while my publisher makes a heck of a lot more. That is fine by me, they took the risk, they reap the rewards. I get to build on their confidence in my future promise.

I love Capitolism. It works well if you let it.

Posted by: michael at February 25, 2010 12:14 PM

I definitely don't have a problem with unions...but many unions in this state, and i have and will continue to repeat this, believe that they have a right to dictate terms to the masses. They have a self-serving short-sightedness (read: Central Falls teachers) that in the long run does not even serve them well.

I am coming to the mindset that the unions run our state and that every decision is either approved by or challenged by the unions. And to me that means their fingers are too heavily dipped into our cookie dough.

Still, I've heard from some politicians that they are negotiating and winning concessions from different unions. That's a good sign that some are getting it. But there are still some that are giving all the others a really bad name.

Posted by: don roach at February 25, 2010 12:26 PM

What is wrong with the sentence Dan? It is surely as good as any of the overly wordy pretentious crap that Mr.Katz writes. Katz would do well to apply ockhams razor to his usually self-congratulatory swill.

Posted by: DandildoNtop at February 25, 2010 12:45 PM

I'd much prefer Katz to a Fox in the henhouse.

I had an interesting discussion with some legislators recently though, they said that an incoming senator or rep from an opposing party would likely have to scratch backs and kiss boots for about four years before they would get a piece of legislation on the agenda.

Change is much farther away than you thought, unless we can break the binds of seniority and leadership in the General Assembly.

Also, at the same time that moderate Democrats are vacating their offices to seek higher positions, younger and more progressive Democratic candidates are vying for the open seats left behind. I predict (with great sorrow) that the landscape on Smith Street next year will be even more left-leaning than it is today. That will continue to be the case as long as other parties aren't able to field candidates for the majority of seats.

Posted by: mangeek at February 25, 2010 12:50 PM

>>Problem is, the public sector unions don't have beachside villa's, they are the very middle class people who Ed Achorn continually attempts to portray as the elite. Simply not true.

Hmmm.

Funny how next door to my house in Middletown is a retired NYC cop and teacher. He bragged about working lots of OT his last few years in order to goose his pension. They keep their place in NYC and NY plates, because that way their pension income is free from NY state tax.

Their house -- this their second / vacation home was probably worth about a million at the peak of the market (don't know about now), as it was located in a desirable area within walking distance of two beaches.

They summer there, spend some time in NY, and spend a few months of the winter near St. Augustine, FL (for all I know they own a place there too).

Next door to them, in a second / vacation home of equivalent value, are a couple of teachers from Hartford who summer there.

Real middle class people aren't buying second vacation homes, but instead are worried about job security and if they'll be able to retire at all, much less retire with a "unlike personal savings, can't outlive it" taxpayer-financed pension and second homes by the beach.

Of course, these second homes owned by the rank and file don't compare with, e.g., former LIUNA leader Arthur Coia's place in Barrington. You know, the place with the Ferraris in the garage.

Posted by: Ragin' Rhode Islander at February 25, 2010 12:52 PM

"I belong to a union and firmly believe in the princables of organized labor; the right to collectively bargain, the legality of contracts and the need for a strong voice in government, collectively, to equal the immense power and wealth of corperations and wealthy individuals whose lobbying power far exceeds all of labor combined."

Which is precisely why I support PRIVATE unions, but not PUBLIC ones, Michael. You apparently draw no distinction between the two, but any economically-minded person can see that they are apples and oranges. I have no problem with laborers spontaneously organizing themselves, they have that right of assembly in a free society. I have a problem with monopolistic public unions collectively bargaining against "the taxpayer." That makes NO sense in a free society. None.

Posted by: Dan at February 25, 2010 12:59 PM

"Problem is, the public sector unions don't have beachside villa's, they are the very middle class people who Ed Achorn continually attempts to portray as the elite. Simply not true."

Michael, in Boston it is common for police to make 160-200k through (bogus) overtime. I'm not talking about chiefs and deputy chiefs either. Oh yeah, and half of the firemen here go out on disability while filling in for a supervisor to exploit the pension loophole. They are currently under investigation by the Feds for mass disability fraud. Retirees from the above-mentioned public departments almost all own beautiful homes in affluent Newton and Needham alongside doctors and corporate attorneys. It is well known here that the police and fire unions own the MA legislature. Public unions are not the good guys you have been indoctrinated into believing they are. They are a philosophical absurdity and a millstone around the neck of any state's economy.

Posted by: Dan at February 25, 2010 1:09 PM

I'm probably doing better than the average union person and there is no way possible I will be going on vacation any time soon, never mind buying a million dollar vacation home. I used to think you made some sense, but this is truly ridiculous.

Posted by: michael at February 25, 2010 1:10 PM

Just marry another public sector employee and you'll have plenty of cash flow to be able to get that nice vacation home!

When you're both looking at fat lifetime pensions and retiree healthcare you can spend every single dime you make, such as having a second mortgage on a vacation home.

After all, unlike private sector middle class couples, you won't have to be bother diverting money into 401k's or other retirement savings ... with whatever is left paying income, sales and property taxes to fund those fat public sector pay and benefit packages, that is.

Posted by: Ragin' Rhode Islander at February 25, 2010 2:14 PM

Or, you could marry the director of the education whatever it was that Ed Achorn's wife was running and really strike it rich.

Posted by: michael at February 25, 2010 2:32 PM

So, Dan, I assume that two sets of rules apply in your world, one for people who work for the private industry, the other for the lesser citizens, those working for the government.

Thank god we are governed by law rather than economics.

Posted by: michael at February 25, 2010 3:50 PM

Michael, that's ridiculous. I don't judge people by whether they are a public or private employees. As a libertarian, I believe in equal treatment under the law for everyone, and I myself work for state government.

Ideally, I would like the state to be right to work, since I think the right to not join a union is just as important as the right to join one (you will always find me on the "anti-coercion" side of an issue). But even aside from the right-to-work question, the "disparity of bargaining power" argument for private unions against employers simply makes no sense when applied to the public sector. I could reiterate all the economic and philosophical reasons why, but you've already heard them numerous times from myself, BobN, Ragin', Justin, and many others. Equating the fundamental natures of public sector and private sector jobs makes no sense. The ways in which salaries are set are completely different.

Posted by: Dan at February 25, 2010 4:23 PM

Michael, there is a good example of how your education has led you astray. The laws of economics are laws of nature, like the laws of physics, and they cannot be repealed or superseded by man-made laws. Whenever politicians to try to do so, they create worse consequences than the false problem they intend to solve.

Posted by: BobN at February 25, 2010 5:32 PM

"My political indoctrination was formed mostly in high school, when I watched Ronald Reagan become the President of the United States and restore some some pride to the country."---Michael


Michael

I cannot help you with the discussion with those here who are clearly anti union. There is no middle ground. They will tell you private unions are OK, it's the public ones they object to, but they are not being honest. They dislike all unions. They dislike minimum wage laws. The dottering old fool who you admired opened up the country's treasury to the wealthiest at the expense of the middle class and the poorest. Ketchup was a vegetable in Reagan's world of make believe for the poor children relying on school lunches. Divine justice turned the bastard into a vegetable at the end of his second term. So do not expect any help from me when you list an enemy of labor as one whom you admire. Good luck. Maybe if you suffer the financial consequences as a result of the political activity of union enemies and the job you clearly enjoy is less than what is has been you may decide to in a phrase you and they will understand "Go Galt". Good Luck.

Posted by: Phil at February 26, 2010 8:13 AM

If the government employee unions (and here I do not mean you, Michael, and your brothers in the fire and police unions who are professionals), meaning all of the AFSCME and SEIU pawns in the army of the Statists, were to "go Galt" it would be a great benefit to the public.

Posted by: BobN at February 26, 2010 9:08 AM

What can I say, Phil, I like Reagan. I was a junior in 1979 when the Iranian hostage crisis was in full swing, my father was on strike, and had been for months, we were eating Spaghettio's, (no meatballs) and pancakes, Japan was killing us economically.

I remember the election in '80. The guys in school were talking about the new president, how he was going to wear a military uniform in the white house, reinstate the draft and do a John Wayne thing to get the country back on its feet.

Springsteen was singing Nebraska, I was looking for work, interest rates were in the 20% range and my family was looking at welfare.

1980 comes around, the strike is over, meatloaf starts to show up now and then and I got a job at Texas Instruments, a company that was just about out of business. Then I read Atlas Shrugged and decided I was in control of my future and nobody else. Excellence was my goal, and I've carried that into by careers, union and otherwise.

Its worked for me. So I don't need your help. Thanks anyway.

Posted by: michael at February 26, 2010 9:57 AM

Phil writes, "I cannot help you with the discussion with those here who are clearly anti union. There is no middle ground. They will tell you private unions are OK, it's the public ones they object to, but they are not being honest. They dislike all unions."

When somebody accuses you of not being honest about your own opinions and motivations, there really isn't anything else to be discussed. It's a conversation-ender. No matter how you try to defend or clarify yourself at that point, that person will simply claim dishonesty, and since opinions and motivations are internal matters that only the holder can truly know, it is impossible to prove them wrong.

Nevertheless, for the sake of other readers, I will say that what Phil writes is inaccurate. I have stated many times that I have no problem with the concept of private unions, and many other posters have said things to the same effect. I do not think unions are good for companies or the workers who are inevitably laid off as a result of loss of profitability and their compensation and jobs being rerouted to senior members, however I think self-organization is a right that workers should retain in a free society. What I do oppose is the government intervening to grant unions a monopoly over public services and then giving them special powers and protections, distorting the entire market and giving them a grossly unfair advantage. Collective bargaining with an employer is philosophically tenable, although I believe it to be detrimental more often than not. Collective bargaining with the taxpayer is a completely nonsensical idea which will always lead to abuse and financial ruin for any society which promotes it.

Posted by: Dan at February 26, 2010 10:30 AM