As the Wisconsin protests have continued and spread to Indiana and Ohio, with solidarity rallies held in Sacramento and elsewhere, the strategy of Republican Governors becomes clear: cripple public unions. If there was ever any doubt about this goal, it was dispelled by Wisconsin Governor Scott Walker’s conversation with a newspaper editor (impersonating billionaire conservative campaign contributor David Koch) in which Walker discusses their anti-union strategy.  This conservative effort has important implications for the Sacramento area. 

Not coincidentally, the effort follows a long decline of unions. In 1945, according to the Department of Labor, unions represented 34% of private employees, 10% of workers in the public sector. This is now reversed: 7% of private, 36% of public workers – the overall number of union workers declining from one in every three in 1945 to one in every eight today. Crippling public employee unions, in the guise of balancing state government budgets, could well put the finishing touches on unions.

How is this important to Sacramento?  Our area is currently more unionized than the rest of California, far more than the nation as a whole. According to data compiled by Hirsch and Macpherson (2011) from the Current Population Survey, 26% of Sacramento area (Sacramento, Arden, Arcade and Roseville) workers are covered by collective bargaining, compared to 19% across California and 13% nationwide. And of the 828,000 workers in the Sacramento area, 196,000 are public employees, three-fifths of whom are union members. An attack on public unions is an attack on a group of workers that comprises a vital segment of the local economy.      

Shouldn’t public employees have the right to organize and bargain just as do those in the private sector? President Roosevelt in 1937 argued that public workers have the right to fair pay and working conditions, but nonetheless being “public servants” should not collectively bargain or strike. Some today contend that public unions have undue political influence over their employers, public policymakers. But that argument is now irrelevant after several court decisions, not least Citizens United v. Federal Election Commission (2010) which enables anyone, anywhere – unions, business, BP, the Koch brothers, Carlyle Group, Americans for Prosperity, Carl Rove, etc. – to influence political activity without disclosing contributions to the taxpaying public.

The cause of unions’ decline? Multiple factors, not just as some experts allege, the 1947 Taft-Hartley Act or Ronald Reagan’s firing of federal air traffic controllers in 1981. Many conservatives argue that unions have lost their public support. The fallacy of this argument was revealed in a recent New York Times/CBS News poll showing that Americans support bargaining rights for public employees by nearly 2 to 1. Moreover, 61 percent of respondents to this poll feel that salaries and benefits of public employees are either "about right" or "too low" for their work. 

Current media accounts tie unions and bargaining rights to excesses in public pensions and benefits.  Truth is, the most outrageous of these pension excesses have been perpetuated by elected officials and management, not public workers.  The very most egregious - like, for instance, the city of Bell scandal or the City Council of Citrus Heights voting itself retirement benefits as the economy declined and the city's liabilities were increasing or the local Congressman whose retirement benefits from his State's Attorney General position were coincidentally increased by over $10,000 annually - are the result of poor legislation or management decisions, officials violating their public trust.      

In any case, over the past three decades unions have lost many rights to organize, employers finding ways to ignore the 1935 Wagner Act. The result: flat median hourly wages (the bottom one-fifth declining) while, astonishingly, worker output per hour nearly doubled and (equally astonishingly) executive salaries rose by five times.  At the same time, big employers found ways, through “reorganizations” (aka bankruptcies) to unload their health, severance and pension obligations to workers. With flat or lost wages and disappearing “fringes,” workers traded their union cards for credit cards.

The results of these events are evident in current federal and state reports. Of every 30 American adults:

• one is in prison, jail, on parole or probation
• two are “officially” unemployed
• two have quit “looking” for employment or can’t find full-time employment
• two are under-employed, working at near-minimum wage, mostly without benefits
• two work two or more jobs just to get by

Thus, nearly one out of every three American adults has lost out on the “American Dream.” Incredible numbers for “the most-wealthy nation on earth.”

Sacramentans certainly know this pain – struggling housing and construction, anchor public services problematic what with the State budget crisis, this area one of California’s leading communities in unemployment and foreclosures. According to Realty/Trac, one of every 151 homes in greater Sacramento received a foreclosure filing in January. Local real estate prices driven down by absentee owners buying lucrative short sales and foreclosures. Just coincidentally, Harper’s March edition features “Homeless in Sacramento.”

More numbers: one percent of Americans account for 25% of the nation’s income, the worst wealth inequality in modern history. (Fifty years ago, the top 1% accounted for 10%.) Of every five homeowners, one is now “under water” (a mortgage greater than the home’s value) and 100,000 homes are foreclosed every month. Or: one in every four (yes, an incredible ¼ of) U.S. children live in poverty. And, despite healthcare reform, many Americans will continue to lack health insurance, joining long queues at the nearest ER for urgent health care, nevermind needed preventive care.

While today’s unions, including those in Sacramento and California, as well as Wisconsin, have and are willing to negotiate and compromise, Governor Walker refuses, arguing that they must give up collective bargaining rights. (Ironically, it was Wisconsin a half-century ago where non-federal public employees first got the right to organize and collectively bargain.) New Jersey Republican Governor Chris Christie divisively plays “divide and conquer,” by pitting a property tax reduction for seniors against the public unions. The news media typically portray the current protests as “public unions versus taxpayers.” Aren’t public employees, many of whom are teachers (public safety workers seem exempt from the discussion), also taxpayers?

What’s next? Privatizing social security and other safety-net programs? Class warfare? Perhaps that’s not an accurate description of this scenario. What is clear, however, is who is getting the short end of the stick - in Sacramento as well as across the country. Loss of unions would exacerbate Sacramento's and America's on-going redistribution of wealth from poor to rich. As Mohandas Gandhi said, “The earth provides enough to satisfy every man’s need, but not every man’s greed.”

Chuck McIntyre
Sacramento economist, writer, and small-business owner.