Work Part 2

This post is kind of a continuation of yesterdays comments.  At any rate it is related.

Over at the Belmont Club there is an interesting post that is focused on the Democratic chances in the November 2010 elections, in Ohio.  How does that relate to work?  Well, embedded in the article are a number of items relating to unions, and union membership in the US (or at least Ohio).

The article really focuses on how effective labor unions can be (or not) in driving the voting choices of their members, and helping to drive an election result through endorsements.  What I found interesting though is this nugget:

…past policies have driven a wedge between the private sector workers and the public sector ones?  Cuhayoga Falls Mayor Don Robart told an audience in February that 30 years ago there were twice as many private sector union members as there were in the public sector. Today, the public sector union membership is in the majority and government is increasingly hard pressed to pay them.

As recently as 1980, there were more than twice as many private sector union members than there were public sectors. Today 51.4% of Americans 15.4 million workers are employed by the government. This is the first time in American history that there are more public sector union members than there are private.

Robart added that “with payrolls being essentially locked –in, due to mandatory collective bargaining, at 3% and health care cost rising between 12 and 15%, it was only a matter of time before the economic bubble would burst.”  Getting more money to keep the bubble up was not an option. On the supply side taxes were drying up; the air was running out. That meant that even public sector employees were beginning to hurt and some were being asked to accept unpaid furlough during the year.

…on the income tax side, historically, the city would expect growth of 1-2% per year. In 2009, we saw our income tax decline by $504,000 over 2008. A third source of income for most cities is the interest on our reserve funds. Once again, we are seeing a significant drop in revenue. In the year 2000 for example, we realized over $2.2 million dollars in interest, and now due to significant lower interest rates, we saw the interest on our reserve drop to $547,000.

In response to these significant drops in revenue, we mandated that the nonbargaining employees accept a wage freeze along with six furlough days.

Now that relates back to my point from yesterday.  Through their negotiated agreements, and aggressive approach to achieving better conditions and wages for their members unions have in fact taken the economy past the tipping point.  Now, unions are not the sole cause of our current economic woes but, I think a successful argument can be made that they have been a significant contributor.

I recognize that it does take two to tango here.  Corporations, and government agencies also bear a portion of the fault as well.

I just found those statistics and comments interesting and thought they tied in.  I hope it makes you ponder potential solutions.