June 6, 2005

Rhode Island Politics & Taxation, Part XVIII: Union Doublespeak, Again

Marc did an earlier posting highlighting comments by the NEA's Bob Walsh on the Dan Yorke radio show last week.

One of the most insightful and knowledgeable observers of RI politics, Tom Coyne of RI Policy Analysis, has provided further information for us about that Dan Yorke show in a June 5 posting, which is recreated here:

If you ever needed a perfect example of the old saying, "give them enough rope and they’ll hang themselves", Dan Yorke gave it to Rhode Island last week, beginning with his interview with Guy Dufault, followed by WPRO’s broadcast of Union RI’s "Rally for Respect", and ending up with his interview with the NEA’s Bob Walsh.
Let’s start with some self-serving Dufault quotes, and our responses. "Rhode Island teachers pay 9.5% towards their pensions – that’s one of the highest contribution rates in the country." Yes, for one of its most generous pension deals. No surprise there. And that doesn't begin to tell the real story.

"People are quick to criticize teachers because they don’t think that what they do is important work." No, it's because Rhode Island spends more on education than most other states in the country, but still gets much lower scores on the NAEP tests.

"We’re fighting for working families." Let’s define "working families" as those making less than 200% of the Federal Poverty Limit. This is currently $47,125 for a family of four. There is no doubt that the Democratic Party has been fighting for them. 200% of the FPL is the cutoff point for Rite Care eligibility. A family of four earning up to $47,125 currently pays $92 a month to insure two children under Rite Care. Moreover, new legislation has been proposed (S. 321) that would reduce this to just $46 per month, or $552 per year.

A similar situation exists with respect to our state subsidized daycare program. We are currently the only state in the nation that offers, as an entitlement, the right to state subsidized childcare for families who earn up to 225 percent of the federal poverty limit, or $42,412 for a family of four. Democratic Senator Elizabeth Roberts (a declared candidate for Lieutenant Governor) has proposed (in S. 539) to raise that eligibility cap to 250 percent of the FPL, or $47,125 for a family of four.

Moreover, the Democratic Party’s "fight" on behalf of "working families" goes well beyond these two programs. We also have on of the nation’s highest income thresholds before a family has to start paying state income tax, and we are also one of the few states to offer an Earned Income Tax Credit at the state level (in addition to the Federal EITC). And let’s not forget that people stay on welfare (TANF/FIP) longer in Rhode Island than in any other state in the nation, and that we exempt a far higher percentage of TANF/FIP recipients from the federal five year limit than any other state.

Of course, this raises an obvious and interesting question: Just how many Rhode Island families make less than 200% of the Federal Poverty Limit? According to the National Center for Children in Poverty at Columbia University, the answer is 39,232. That is 29% of all family households in Rhode Island – hardly a majority (the comparable percentages for Massachusetts and Connecticut are, respectively, 25% and 23%). Moreover, according to the U.S. Census, there are 411,579 households in Rhode Island, both family and non-family. 39,232 is about 9.5% of the total. It is, for example, dwarfed by the 104,365 households that contain at least one person age 65 and older – you know, the people being forced out of their homes by Rhode Island’s crushing tax burden. Funny how Guy Dufault forgets to mention these inconvenient facts.

And let’s not forget how Rhode Island treats families who are just above the magic 200% of the FPL cut-off. Consider a family of four that makes $48,854 -- the median annual household income in Rhode Island in 2003. Not being eligible for Rite Care, they might have to pay almost $9,000 per year to buy a family policy from Blue Cross. But that’s nothing compared to what they might have to pay for (unsubsidized) childcare. In her recent testimony to the state House of Representatives, Kate Brewster, the executive director of the Poverty Institute, noted that a family earning this level of income would pay $4,812 per year for subsidized care for two children. However, a family earning the state median household income of $48,854 would pay $14,580 per year. So much for "fighting for working families." I think many Rhode Island families would choose another verb besides "fighting" to describe what the public sector unions, the Poverty Institute, the One Rhode Island Coalition, and the Democratic Party are doing to them…

But let’s not say Mr. Dufault lacks a sense of humor. With a straight face, he actually told Dan Yorke that "we [Union RI] are working to improve the environment so people will want to come here and build there companies here in Rhode Island." Right. Those of us who own small companies here are just overwhelmed by the attractiveness of a state where we bear the nation’s fifth highest tax burden (and its absolute worst one if you are retired or affluent), and in exchange receive some of its worst performance in public education, the condition of our roads and bridges, and the effectiveness of its social safety net…

Let’s move on to the unions’ "We Demand Respect" rally (also described in this Projo story). I think Dan Yorke set the perfect tone for the day with his opening observation that "you earn respect, you don’t demand it." What followed on Wednesday was an incredibly powerful argument for re-electing Governor Carcieri.

Here are some of my favorite quotes: "We’re going to demand that we get treated with respect and dignity." -- George Nee.

"Tell that guy in the center office who calls himself a governor, ‘we don’t want you to take our money.’" – Frank Montanaro. Of course not. The public sector unions want him to take more of the taxpayers money...

The Tax Payer Relief Act proposed by a bipartisan group of Republican and Democratic State Reps calls for a 20% health insurance premium co-share by public sector employees and management’s right to use subcontracting and to layoff employees. Tom Poppa, a Woonsocket firefighter, led the crowd in an "It Stinks!" cheer.

Speaking of crowd cheers, the first time this technique was used, it was a good rhetorical device. By the tenth time, it had become a tired comedy routine, reminding one of a group of people in late middle age trying to recapture the glory days of Civil Rights and Anti-Vietnam War demonstrations.

Moving right along, there was a history teacher from Pilgrim High in Warwick who predictably criticized the alleged "lack of adequate state aid to education" without mentioning where the additional funds should come from – higher taxes or cuts in other spending (like the $1.2 billion in General Revenue funds we spend on our social welfare programs). I began by wondering why they used this teacher to make these points, instead of Democratic Senator Jim Sheehan, who is also a member of the Warwick Teachers Union. I also wondered why they weren’t talking about the Warwick Teachers Union’s demand for free health insurance for life for family members. I ended up thinking that the teacher’s chant of "We get no respect!" sounded like a terrible Rodney Dangerfield impression…

And the teacher's call for voters to "send them [who?] a message next November that they better respect us!" was priceless. After listening to the speeches at this rally, I’ll bet quite a few voters had a message they’d like to send to the public sector unions and their alter ego, the Rhode Island Democratic Party.

Then Larry Purtill, the head of the NEA, got up and once again asked, "why won’t the Governor increase state aid to education?" And, just as predictably, failed to suggest where the money should come from. No chapter in the next Profiles in Courage book for Larry…

And then we come to Amy Mullen, a teacher from Tiverton, and head of her local union. I just loved her call to raise taxes on you-know-who, based on the justification that "the wealthy won’t leave Rhode Island, because they can’t take the beauty of Narragansett Bay with them!" Apparently, the fact that they already have left (as evidenced by Rhode Island’s far lower share of affluent taxpayers than neighboring states, as well as the fundraising woes of many Rhode Island charities) hasn’t made much of an impression on Ms. Mullen…

On the other hand, the speaker from the American Council of State, Local and Municipal Employees who shouted that "today, the line in the sand has been drawn" undoubtedly, if inadvertently, probably summed up most Rhode Islanders’ impression of the rally…

Finally, what can you say about the firefighters union’s attempted intimidation of Dan Yorke, who was broadcasting live from the rally, while surrounded by firefighters (you know, the guys – and in RI it is mostly guys, and white ones at that – who like to portray themselves as heroes) banging loudly on drums and swinging mallets an inch from his head. If ever we needed an image of the ever present threat of thuggery that lies underneath the unions’ rhetoric, they provided it on Wednesday…

Now let’s move on to NEA Executive Director Bob Walsh’s surprise appearance on Dan Yorke’s show after months of apparently refusing invitations. While we appreciate the teachers unions’ new-found desire to engage in public debate, we can only respect them for it if they don’t lie about key facts.

Here’s an example of what we mean. Dan Yorke asked Bob Walsh about the fact that the ratio of the average Rhode Island teacher’s salary to the average private sector worker’s salary is the highest in the nation. Walsh replied that this was due to the "fact" that Rhode Island’s average education level was the lowest in the nation. This made Rhode Island workers "uncompetitive" with workers from other states, causing our average private worker’s salary to be lower than those in other states. Let’s look at the real facts. First, how do average education attainment levels in Rhode Island compare to those in other states? In terms of the percentage of Rhode Islanders with a BA degree or more, we rank 19th in the nation. The comparable rankings for Massachusetts and Connecticut are, respectively, #1 (the best) and #6. At the other end of the spectrum, in terms of the percentage of residents who have not graduated from high school (with 50th being worst), Rhode Island ranks 44th, Massachusetts ranks 27th, and Connecticut ranks 13th. Finally, in terms of average private sector earnings, Rhode Island ranks 24th in the nation, according to the Bureau of Labor Statistics (#1 being best). In sum, the facts do not support Mr. Walsh’s argument; rather, they disprove it.

Mr. Walsh then claimed that Rhode Island had to offer its very generous package of salary, health insurance and pension benefits to teachers in order to effectively compete with Massachusetts (where, I note, teachers pay a higher share of their health insurance costs) for qualified candidates. He conveniently avoided mentioning this recent report from the Progressive Policy Institute, which found that three quarters of the fall in the quality of teachers over the past 30 years or so has been caused by salary compression due to union contracts. We have a better idea for Mr. Walsh: let's institute merit pay with real teeth in it, as well as alternative certification (e.g., to facilitate mid-career moves into teaching) and see how well we compete with Massachusetts for high quality teachers...

Moving right along, Bob Walsh once again rolled out the sob story about Rhode Island teachers contributing 9.5% of their pay to their defined benefit pension plan, and not being eligible for Social Security. As we have extensively explained here, like Sherlock Holmes’ dog that didn’t bark, it’s what Mr. Walsh doesn’t say on this subject that tells the real story.

On the subject of pensions, we got a real kick out of Bob Walsh’s clarion call for "a fully transportable pension system for all employees." Uh, Bob, we’ve had one for quite a few years – it’s called a 401k or 403b plan.

This was followed by an awkward turn to the phones, which featured a member of the IBEW saying that Frank Montanaro and George Nee had done a very bad job of leading the union movement in Rhode Island, and should be replaced. Frankly, I have a lot of empathy with this caller. You have to admit, that the specter of Marcia Reback's iron-fisted demand for "free heath care for life for family members" was a bit off key at a time when Ford and General Motors were downgraded to junk debt status because of this type of obligation, and when United Airlines was forced into bankruptcy by them. In our view, it is just more evidnece of the fact that public sector unions and private sector unions have little or nothing in common...

After this call, Dan began to take off the gloves, and asked Walsh about the Education Partnership’s report and its calls for merit pay. After repeating his "declaration of war on the Ed Partnership" (and, one presumes, on the businesses and taxpayers who support its recommendations), Walsh noted that he is "philosophically opposed to merit pay." But, just to hedge his bets, he also tried to claim that teachers already receive merit pay, in the form of higher compensation when they receive a master’s degree, or obtain national board certification. Yorke then slammed him with a great line: "That’s not merit pay, that’s resume pay." Anybody who works in the private sector could instantly see the absurdity in Walsh’s argument: "Hey, boss, I know that our performance is way below most of our competitors, but, you see, I got a masters and went to some great training programs, so, like, I think I deserve a merit bonus this year." Yeah, right.

This forced Walsh back to his next defensive argument, that "Lot’s of folks coming at [the merit pay issue] have a business perspective, and can’t understand it because they don’t have a teacher’s perspective on it." I suppose this would also mean that if crime is up, don't complain to the police, or if fire deaths are up, don't complain to them, etc. Here's the simple truth: all organizations, from bacteria to multinational corporations to schools systems and all stops in between, can be evaluated on three criteria: (1) effectiveness: does the organization achieve its goals? And are those goals, in comparison to the goals set by competitors, sufficient to ensure its survival? (2) Efficiency: how many resources are used to produce one unit of effectiveness, however you measure it? And (3) Adaptability: to what extent does an organization maintain or improve its effectiveness and efficiency as conditions change in its environment? Basically, Walsh is full of it when he says, in effect, "you can't take part in this discussion if you're not a teacher."

Walsh then rolled out the howler of the day: "teachers don’t want merit pay." Yorke basically said, "B.S.". I continue to wonder why Walsh isn't loudly pitching this argument to faculty members at Brown or PC or URI – or even at the otherwise egalitarian RIC School of Social Work. Think about how well Walsh’s argument that people who teach should be paid just on the basis of seniority would go down with faculty members on those campuses! I still marvel that Bob Walsh and the NEA believe that North Kingstown’s Kathy Mellor – the United States national teacher of the year in 2004 – should be paid the same amount as her system’s worst teacher, if both have the same amount of seniority...

If you want to learn more about RI public policy issues, spending time exploring the information available on Tom and Susan's website will be a very worthwhile investment of your time.

This posting continues a periodic series on Rhode Island politics and taxation, building on seventeen previous postings:

I - Guiding Principles for Sound Public Policy
II - The Outrageous Tax Burden in Rhode Island
III - 2004: The Year in Review
IV - The NEA's Disinformation Campaign
V - Governor Carcieri's State of the State Address
VI - "Citizens for Representative Government's" Deceitful Manipulation of the Constitutional Convention Vote
VII - The Extreme Tax Burden in the City of Providence
VIII - Rhode Island Gets a C+ on its Report Card
IX - How Speaker Murphy's Changing of the Rules of the House Reduces Your Freedom
X - East Greenwich Teachers' Salary and Benefits Data
XI - What Was Rep. Fox Doing in Portsmouth?
XII - Why Do RI Citizens Passively Consent to Governmental Control by Powerful Interests?
XIII - RI House Leaders Show No Respect for Rule of Law by Undermining Separations of Powers, Part I
XIV - More Bad Faith Behavior by the NEA
XV - RI House Leaders Show No Respect for Rule of Law by Undermining Separations of Powers, Part II
XVI - Tom Coyne - RI Schools: Big Bucks Have Not Brought Good Results
XVII - RI Public Pension Problems