Solving Government’s Biggest Problem

Richard Salbato 11-16-2010

Over the next three years the new Constitutional Conservatives may be able to reduce the size of government but the hardest thing will be the contracts of Government Workers Unions both at the Federal Level and the State Level. The object of this Newsletter is to let you see the options we have and their pros and cons.

History

Throughout American history -- and as recently as the 1950s -- there were no unions for government workers. Public-sector employees were expected to earn a bit less than their private-sector equivalents. The reasons they did so included an interest in public service, job security and reasonable benefits.

But that changed in the late fifties with New York City Mayor Robert Wagner's cynical appeal to the votes of city workers. He signed an executive order authorizing them to unionize, and soon other local and state Democrat legislators around the country followed his lead.

These efforts culminated in 1962, when President John F. Kennedy granted federal employees the right to collectively bargain. Since then, public sector union membership has skyrocketed while, in the private sector, unions have fallen out of favor. Also by executive order!

The historical basis of unions revolved around workers receiving a reasonable share of a company's profits. But that tenet is nonsensical when applied to public service. Governments don't make profits; they simply assess taxes.

The aims of public sector unions conflict directly with the interests of taxpayers.

And because it has been exceedingly hard to fight public sector unions, the salaries and benefits of public employees have skyrocketed in recent years. Since the election of Barack Obama, the number of federal employees making over $150,000 a year has more than doubled to over 10,000.

In 2009 government salaries jumped 2.4%, approximately twice the increase earned by private sector employees. In fact, the average salary of a federal worker is now $71,000, about $22,000 more than the average private sector employee.

Worst of all, public sector unions have negotiated pension plans that are proving financially untenable. Many allow workers to retire at age 55 at around their full salary in their final years of employment. These pensions often include inflation adjustments as well as lifetime free health care.

These plans are so outrageous that state retirement systems, for example, are currently underfunded by about a trillion dollars.

So how have public sector unions achieved these amazing results? The answer is hundreds of millions of dollars, the approximate amount that unions have contributed to federal campaigns since 1990. Almost every dollar went to Democrats or Democrat causes. In the 2008 election alone, some estimates put public sector union contributions to Democrats at $60 million.

These unions are also astroturfing for Democrats, providing slush funds to help liberal causes. An example is ThePartyIsOver.org, a faux populist website designed to discredit TEA Party activists.

The Democrats' health care bill, the 'Employee Free Choice Act' and the $800+ billion stimulus bill all contained payoffs to public sector unions. In fact, while the private sector has shed 7,000,000 jobs since the recession began, the number of public sector jobs has risen every month.

Public sector unions are killing our economic system and the American taxpayer. The debt unleashed by their outrageous benefits plans simply cannot be paid. The union bosses have lied to their members about lifetime benefits and they have betrayed the American people.

Public sector unions must be disbanded and outlawed before our country resembles Greece, Spain and other European countries that are teetering on the brink of destruction, thanks to unions just like ours.

1. A Brief, Illustrated History of the Public Sector Unions That Are ...

Pros and Cons of Ways to Correct this Problem

The Contract

When you talk about the completely unfair contract that Unions have with Governments, they argue that you cannot break a legal contract. The real danger of these contracts is the life time retirement and Medicare benefits that we pay to people already that no longer work for the government. In some cases people only have to work 20 years and then retire at almost full pay for 50 to 60 years.

I believe we could break these contracts, even the old ones, because they do not meet the law of contracts. Contracts cannot be forced. Contracts cannot be one sided. Contracts cannot be bribed.

“From an immoral contract an action does not arise. Dolo malo pactumse non servaturum. An agreeeent induced by fraud is not valid. Pacto aliquod licitum est, quid sine pacto non admittitur. By agreement, things are allowed which are not otherwise permitted. Nulla pactione effici potest ne dolus praestetur. By no agreement can it be effected that a fraud shall be maintained.”

The very way that government unions get all these unsustainable benefits is fraud. They hand pick and then finance government congressmen, governors and presidents in exchange for favorable contracts. Since unions negotiate with the people they hand picked and paid off, these contracts are both fraud and an illegal monopoly. If we had a good legal system in this country I would advocate filing a lawsuit against these contracts, but I doubt we could win.

However, something has to be done, since states have a trillion dollars in unfunded government pensions and I don’t know how much the Feds have.

Constitutional Amendment

Since this country outlawed unions in government for over 250 years, it seems to me that we could outlaw them again by executive order – the same way they came into existence only 48 years ago.

However, since this president owes his election to the 80 million he received from unions, he would never do this. In fact most Democrats owe their elections to government unions.

The congress and senate could outlaw them but the president would veto it.

This would leave a constitutional amendment but it would take too many votes in the senate to pass, and would not address the existing pensions. The only way to reduce these pensions is bankruptcy, which I am not against. The reason I am for government bankruptcy is there is no other way to get rid of existing pensions which can never be paid off.

Privatize workers

Over 40% of state government workers are not unionized, but are directly employed by counties and cities. These do not have the problems of the other cities and states that have unions. But this also is not the best system because governments do not know how to run efficient businesses which these are. Firefighters, policemen, teachers and all other government workers are businesses but not run be people who know anything about efficiency and business.

Many European countries have privatized their postal systems, airports, and harbors and these are now run with a profit and don’t cost the government one penny in taxes. However, these are not run by the government but contracted out to private businesses.

Contract out all government labor

Now this is my recommendation because it is being done in other countries and very successfully without a dime to taxpayers in some cases. Lets see how this works. Call in a company that is doing a similar business to some government agency, let us say congressional payroll which now costs taxpayers three to four million dollars per house and senate members and millions in retirement. The government tells the company what it needs and the company bids to supply those needs at the best price and bids against other companies. If it wins the bid, it supplies the labor and monitors the results and hires or fires the labor that does the job or does not. Of course this does not solve the problem of existing retirement benefits but does stop all future benefits because they fall on the companies and not the government.

Efficiency Experts

The next thing that has to be done is to hire efficiency experts to look at each and every government agency to see if the see if the agency is even needed and if it is, is it run efficiency. Most departments will be found to not even be needed. But other, like health and safety, will be streamlined to see why they do not work. In most cases there is too much management and not enough workers in the field.

Once these efficiency experts make their reports, the agencies can be eliminated or given over to private companies to be run as recommended by the experts.

Never Happen

Not only do I not believe any of the above will happen, but even if it does, I do not see how we rid the government of the existing retirements that we cannot pay for. For this reason, I think this country is going to go bankrupt and we will have to close down and start all over again. This may be the only solution but it will be 3 to 4 years of extreme pain for everyone first.