Ohio Issue 2: Vote Yes for Reform

October 25, 2011

(Jump to provisions of new law)

I remember John Derbyshire arguing years ago that public-sector unions shouldn’t exist, in his top-ten list of “Necessary but Impossible” reforms:

Outlaw public-sector unions

Why do public-sector workers need unions? The purpose of unions is to protect employees against unscrupulous bosses, who might seek to maximize profits by taking advantage of those who work for them. In the public sector, however, there are no profits to be maximized, no shareholders to appease. The work that is being done is being done in the public interest — against which, as Calvin Coolidge quite correctly declared, there is no right to strike. So what do government workers need unions for? If public-sector workers don’t like their pay and conditions, they can appeal to the tax-paying public, who are their ultimate employers. If that doesn’t work, they can go get jobs in the private sector, and take their chances with capitalism, like free citizens of a free nation.  

Please don’t write and whine to me: “I’m a public servant. I’ve worked my buns off for 30 years at a demanding and essential job, for an unimpressive salary. Why are you being mean to me?” I’m not being mean to you. I like you. Thank you for your work, for your service to my country. I sincerely thank you. I just don’t see why you need a union.

The (private-sector) labor movement and unions we all know and sympathize with from The Grapes of Wrath etc. have next to nothing in common with public-sector unions.  As Jonah Goldberg remarks, “Traditional, private-sector unions were born out of an often-bloody adversarial relationship between labor and management,” and often terrible working conditions.  By contrast,

Do you recall the Great DMV Cave-in of 1959? How about the travails of second-grade teachers recounted in Upton Sinclair’s famous schoolhouse sequel to The Jungle?

(Read the whole thing.)  Goldberg observes,

Victor Gotbaum, a leader in the New York City chapter of AFSCME, summed up the problem in 1975 when he boasted, “We have the ability, in a sense, to elect our own boss.”

He also notes that “even George Meany, the first head of the AFL-CIO, held that it was ‘impossible to bargain collectively with the government.'”  According to James Sherk, “George Meany was not alone”; “Government unions are unremarkable today, but the labor movement once thought the idea absurd.”  Even FDR agreed that “the process of collective bargaining, as usually understood, cannot be transplanted into the public service,” and that “a strike of public employees . . . is unthinkable and intolerable.”

The American Federation of Labor (AFL) was founded in 1886; the CIO was formed in the 1930s.  Federal antitrust law was amended to make unions unambiguously legal in 1914, and the National Labor Relations Act was passed in 1935.  By contrast, the first state to allow public-sector unions, Wisconsin, didn’t do so until 1959.  Ohio didn’t allow them until 1983.

Keep all this in mind when you hear people arguing about Issue 2.  Despite what some of its opponents carelessly (or dishonestly) imply, it affects only public-sector unions.  It has nothing to do with private-sector unions.

Earlier this year, the state legislature passed and Governor Kasich signed into law a bold reform of public-sector unions in Ohio, then known as Senate Bill 5.  Its opponents collected enough signatures to keep it from taking immediate effect and put it on the ballot this November; if a simple majority of those who show up to vote (in what is essentially an off year, meaning that mainly only interested parties will show up) so choose, they can repeal SB 5 by voting no on Issue 2.

The Cleveland Plain Dealer has an excellent, helpful table (scroll to bottom of story), simple and easy to read but expandable for further information, setting out the differences between the old (1983) law and the new law.  Some of the highlights of the new law:

  • Public employees are prohibited from striking.
  • It basically ends collective bargaining over hours and benefits.  Collective bargaining over wages is still permitted.
  • It ends the old system of binding arbitration.  Instead, in the case of a dispute between employees and employer, each of the two sides submits a proposal to the relevant legislative body, such as a city council, which then chooses between them.  If the legislators cannot decide, the government’s (employer’s) proposal takes effect.
  • Employees must be paid on the basis of performance, rather than seniority—no more automatic raises just because time has passed.
  • Layoffs are no longer strictly “last in, first out”.  Seniority is still a factor, but now so is performance.
  • Employees must pay at least 15% of the cost of their health insurance.
  • Employer may no longer pick up employee’s share of contribution to pension plan.
  • Government employees who choose not to join the union can no longer be required to pay into the union anyway as a condition of employment.

Issue 2 is endorsed by the Cleveland Plain Dealer:

Senate Bill 5, now on the ballot as Issue 2, gives Ohio taxpayers the opportunity to re-establish control over local government spending. It sets right the relationship between the people and their employees, after 28 years of unions having an unwarranted upper hand.

(Read the whole thing.)

The Columbus Dispatch also recommends voting yes:

. . . several of the provisions of Senate Bill 5 are essential to the fiscal health of state and local governments in Ohio . . . .

The key provisions of Senate Bill 5 are common-sense improvements that most fair-minded people embrace.

See list of other endorsements here.

Even the Cincinnati Enquirer, while hitting Republicans hard for not following the process the Enquirer would have chosen, agrees that “SB5, or something roughly like it, is desperately needed in Ohio . . . .”

Issue 2 has given rise to dueling meaningless names, Building a Better Ohio (for) and We Are Ohio (against).  The two groups do disagree on some of the facts, but I think reading both Web sites with a fair and open mind makes it clear which one is more informative and which one relies more on misdirection and emotional appeals.  Accordingly, for further information on Issue 2, I recommend Building a Better Ohio’s “Myth vs. Truth”, FAQs, and the rest of the Web site.

It appears to me that reason, and the interests of the vast majority of Ohioans, are on the side of Issue 2.  Unfortunately, the other side apparently has plenty of money: “$3.7 million from D.C. unions, more than $2 million from Ohio unions, and less than $40,000 from individual donors”.

It is said, among conservatives, that public-sector unions engender a vicious cycle, or even a legal form of “money laundering”:  The government takes from us in taxes and gives to its employees, the employees give to their public-sector unions, the unions give money to elect Democrats, the Democrats raise taxes and pay the employees more, and the cycle continues.  One of the arguments I’ve heard against Issue 2 (in keeping with liberals’ fixation on assumed intentions, rather than policy results) is that the Republican legislature and governor are doing it only because it will hurt Democrats politically.  I think that’s a curious argument for the anti-Issue 2 people to make; by making it, aren’t they conceding the whole complex money-laundering charge, in which case Issue 2 is obviously right and necessary to fix that?

In any case, it seems clear to me that the anti-Issue 2 side is better funded.  I’m campaigning for Issue 2 as a volunteer; I learned a couple of days ago that someone I know is campaigning against it for pay.

I’m not sure I’ve heard a single ad in favor of Issue 2, but I can’t turn on the radio these days without hearing a recurring ad against it.  It’s long on drama and short on facts:  In it, we hear a 911 call.  Someone has just broken into the caller’s home.  Unfortunately, the dispatcher explains, there have been staffing cuts, and it will take the nearest patrolman some time to respond.

As The Columbus Dispatch frankly says, “The claims of the anti-Issue 2 campaign have been intellectually dishonest.”  Not just in this ad, the campaign against Issue 2 leans heavily on the claim that Issue 2 will result in widespread layoffs of government employees, especially police and firemen, making all of us less safe.  As both the Cleveland and Columbus editorials note, the truth is just the opposite:  Unless they live in a magical land with infinite money, sometimes government officials have to cut back on spending, and if union contracts leave them no flexibility to reduce wages or benefits, the only way to cut costs will be to lay off employees.  Issue 2 is a pro-jobs measure, not only for the beleaguered private sector, but also for the very public-sector employees whose interests it supposedly threatens.


Update (October 25th, 2011): Blogger Uncle Andy calls attention to the problem (not to say abuse) of “double dipping”, when public employees “retire” and then get another job—or even the same job—and so draw both a pension and a salary at the same time.  He also points out that the Buckeye Institute makes information about Ohio public employees’ salaries and benefits both public and easy to use:  It’s an interesting and useful reference, especially if you decide to wade into We Are Ohio’s arguments against Issue 2.

Example:  We Are Ohio says, “The average OAPSE (Ohio Association of Public School Employee) makes $24,000 a year and retires with an average pension of $900 a month.”  This has to be deliberately obfuscatory, if not outright false.  What kinds of public-school employees are we talking about? janitors?  We Are Ohio fails to say.  According to the Buckeye Institute’s database, the average Ohio public teacher makes an average salary of more than $55,000, and annual total compensation (i.e., including benefits) of $76,000.

For whatever it’s worth, We Are Ohio’s characterization seems inconsistent with OAPSE’s own claims, too:  OAPSE says, “Being an OAPSE/AFSCME member gets you the backing of the largest, strongest public employee union in Ohio. It gets you expertise and power at the bargaining table. It gets you health care and retirement security . . . .”

18 Responses to “Ohio Issue 2: Vote Yes for Reform”

  1. Uncle Andy Says:

    You can’t lay out the case for issue 2 any better than you have. Anyone who isn’t a selfish public worker, or a sheeple who has swallowed the scare tactic lies from the We Are Ohio ads, has to agree. I just hope the voters finally stand up to the greedy unions that are holding our communities hostage.

    • Thank you! Yes, I suppose it’s up to the people now. I can complain all I want about out-of-state money and off-year turn-out, but the fact remains that if Ohioans want to pass Issue 2, they can.

  2. Jason Says:

    First, I do agree that the unions have asked for a bit too much over the years. However, this is no more, probably less than, what the wealthy have been taking from us for even longer. Just look at the facts, how we are so far behind the other countries of the world in income disparity, how the income of the wealthy has grown over the years where the poor and middle class wages have stayed stagnant, how strong economies come from lots of money exchanging hands, meaning many people are needed for that. Well, if the “many people” don’t have the money to exchange, then business and, thus, the economy is going to go down.

    Amazing to me that just 10 short years ago, we were praising the work of all the emergency workers nationwide who dealt with the World Trade Center attacks. And, now, they are suppose to be the ones behind our economic downfall? Ridiculous. I am all for efficient government. I don’t believe a policeman/woman is needed for every citizen or a fireperson is needed for every resident house. However, for those who keep talking about keeping government out of our lives, if SB5 passes, that is going to give government the final say in the all decisions of those workers. That will be abused to take on every collective bargaining action, which will destroy collective bargaining.

    Listen, some time after the bill was ramroaded through state congress with little debate, after the anti-SB5 movement started, Kasich himself asked for the anti-SB5 movement to come back to the bargaining table. That showed me enough, that Kasich himself wanted to keep collective bargaining. Since this bill effectively takes it out, only a fool won’t be voting against SB5.

    • First, it’s basically true (Who Really Cares, page 133) that America is richer but Europe is more equal, because of Europe’s governmental redistribution of income. It’s a trade-off, if you like (though an illegitimate one, I would argue, because it requires disregarding property rights). But the European model is untenable and already in the process of collapsing.

      As to your second paragraph, I think you’re falling into the liberal conflation of feelings and intentions with everything else, already answered by John Derbyshire at the top of the page: It’s not that we don’t like public employees, it’s that we don’t think they should get to set their own compensation, in effect helping themselves to more of our (the taxpayers’) money. I’m not blaming them for the current situation; they’re just acting rationally in their own interest, the same as all the rest of us do. I’m suggesting that we reform the system to stop giving them this conflict of interest.

  3. Jason Says:

    They don’t set their own compensation, Chilly. That’s the whole idea of collective bargaining. You need to read up on that business action. Both sides sign to it.

    Second, Chilly, if the European model is so bad, why are we looking at cutting corporate taxes so much, to the levels of the European countries. It seems like to me if their model is so bad, we should be as far from it as possible, probably like increasing taxes on the wealthy and corporations, who are making record profits never seen in the history of this world, with government subsidies. Remember, if you want government out of our lives, that means the oil companies shouldn’t be getting any more government subsidies.

    • The total tax burden in Europe is significantly higher than in America. You’re not contradicting your first comment already, are you? You complained about “how we are so far behind the other countries of the world in income disparity”. How do you think other countries limit that disparity if not through taxation? The fact that America’s corporate tax rate is higher than those of even big-government, high-tax Europe makes the case for lowering our corporate tax rate even stronger than it otherwise would be. But unless there’s something in Issue 2 I didn’t see about corporate tax rates, this is off topic; you’re changing the subject.

      As to your first paragraph, I’m starting to wonder whether you even read the original post you’re commenting on. Yes, under the current (pre-Issue 2) system, both sides have to “sign to it” (unless it goes to arbitration, which is binding). But on the one side, the public-sector unions have a strong direct interest in demanding more (the more they bargain for, the more they themselves get paid), and the power to strike as a significant bargaining chip. On the other side, the politicians are spending our (taxpayers’) money, not their own—so they have only a weaker, indirect interest in saving money—and no equivalent bargaining chip.

      As Derbyshire, Goldberg, and others explain at more length, this isn’t the kind of situation unions were originally invented for. As the Cleveland Plain Dealer characterized it, Issue 2 “sets right the relationship between the people and their employees, after 28 years of unions having an unwarranted upper hand.”

  4. Jason Says:

    Then, Chilly, why are the Republicans constantly talking about how we need to lower our corporate tax rates to those of Europe? You need to stay up with the talk, Chilly? Either you are lying/don’t know, or the Republicans are lying/don’t know.

    Frankly, I don’t care what any other country is doing. I care about doing what is right. Every sector of the US, including the Republican constituents, call for the taxing of the wealthy and corporations, for them to “pay their fair share”, unlike how they get their tax lawyers and find their loopholes to tax their tax liability to 0%, equivalent of a person living in poverty. Buffet said himself, it is wrong for him to be taxed at a lower rate than his secretary is.

    We need money in the hands of more people, so that more people will spend money and the economy can grow stronger. Where’s it going to come from? The poor? Yeah, right. The middle class? They are disappearing everyday more and more? The government? They all are in debt to the hilt already. Who has the money? The wealthy and corporations, Chilly. This isn’t advanced economics, Chilly. Simple math, those who have the money need to start spending the money.

    As for your weak SB5 angle, the politicians are financed by the wealthy and corporations in this state. They have a huge interest in getting what they want; they don’t want to see the wealthy and corporations pull their funding, for they want to stay in office as long as possible.

    Remember, if SB5 passes, the government has even a bigger hand in our lives by telling how our police, fire, and schools are to be run, instead of the police, fire, and teachers doing that at the collective bargaining table with the government. But, the Republicans are suppose to be against that, aren’t they? Hmmm. . . .

  5. […] Issue 2 is an important structural reform.  Without it, public-sector unions will continue to drive the growth of government and higher taxes in Ohio for the foreseeable future.  (This should go without saying, but I have nothing personal against the public-sector-union employees; public-sector unions represent a structural problem, however good the intentions of the individual employees.) […]

  6. […] the most consequential issue on the ballot in Ohio this year is Issue 2.  There are also a number of other issues; enter your address at Smart Voter to find out which […]

  7. […] Ohio Issue 2 went down this week, by a three-to-two margin, 61% to 39%.  It was outspent roughly three to one.  The total “We Are Ohio” campaign was “more than $30 million”, most of which apparently came from out of state (source: first article again): Labor went all in. National unions are estimated to have spent some $25 million on a methodical and unified campaign against the initiative . . . .   […]

  8. […] Ohio both passed laws repealing, to a significant extent, the mistake of public-sector unions.  (Public-sector unions are a relatively recent innovation; they necessarily create conflicts of inter…  The Ohio reform was then itself repealed by ballot initiative, in a campaign funded largely by […]

  9. […] Public-sector unions should never have been allowed to exist.  They represent a structural threat to democracy, allowing government spending to be set, to a significant degree, by its beneficiaries (the government employees) rather than those who pay for it.  They create a vicious feedback loop wherein the government takes money from us through taxation, which it pays to its employees, which they then pay to their unions, which the unions in turn use to elect more Democrats, who raise taxes further, and so on ad infinitum, or at least ad insolvency. […]

  10. […] Democrats favor unions, including public-sector unions (which should never have existed); the Republicans favor right-to-work […]

  11. […] a Tea Party candidate in the Tea Party wave of 2010, but through poor strategic decisions failed to reform public-sector unions where Wisconsin’s Scott Walker succeeded. I think of Kasich’s governorship as basically […]

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