Whence Walker's Win?

COMMENTARY Jobs and Labor

Whence Walker's Win?

Jun 8th, 2012 2 min read

Research Fellow, Labor Economics

As research fellow in labor economics at The Heritage Foundation, James Sherk researched ways to promote competition and mobility.

The roots of Gov. Scott Walker's recall victory in Wisconsin can be traced to Springfield, Ill. The same year that Wisconsinites first elected Walker governor, protesters swarmed the Illinois capitol, yelling: "Raise my taxes! Raise my taxes!"

Who protests for higher taxes? Government unions do. The American Federation of State, County and Municipal Employees helped organize the rally. The union wanted lawmakers to close the state's deficit by raising taxes instead of reducing spending.

Illinois collectively bargains with its government employees, which lets the union veto reductions in their compensation. That leaves layoffs as the only way to reduce government spending. Obviously, the union's members don't want that.

So they chanted for the Legislature to "give up the bucks" and "show me the money." The protest was part of a growing phenomenon of government unions lobbying for higher taxes and more spending.

Historically this is new. The founders of the labor movement did not believe unions belonged in government. They viewed unions as negotiating for a share of the profits their members helped create, not the taxes everyone pays. George Meany, former president of the AFL-CIO, famously opined that "bargaining collectively is impossible in government."

Union advocates also believed the government had a duty to serve the public. They feared that government unions would obstruct essential public services. President Franklin Roosevelt considered strikes by government employees "unthinkable and intolerable."

But in 1959, Wisconsin became the first state to negotiate with government unions. Many other states followed suit. Now most union members work for the government. Unfortunately, labor leaders' initial fears were well-founded. Unionizing government has not benefited the public.

Government employees collect pensions at 55 in Illinois. Other states are more generous. The Michigan Education Association has been highlighting the plight of English teacher Terri List. She plans to retire in three years at 47. Her union thinks increasing her retirement age to 60 would be unfair.

As expensive as these benefits are, the effect collective bargaining has on public service quality is even worse. Research shows that having a good teacher can make a tremendous difference in a child's life - and so can having a bad one.

But unions make rewarding good teachers or removing ineffective ones almost impossible. They insist that schools base pay and layoffs on seniority, not effectiveness in the classroom.

By 2010, Wisconsinites had had enough of it. The state had hiked taxes and still faced a massive deficit. The average government employee made 30% more than he or she would in the private sector - while Milwaukee Public Schools laid off the district's "outstanding first-year teacher" because she didn't have seniority. The government was not serving the public good.

Candidate Walker promised to balance the budget without raising taxes. Once in office, Walker limited collective bargaining for most public employees and cut spending. Because he had limited collective bargaining, however, he could trim benefits instead of firing government workers.

Illinois charted a different course. There, Pat Quinn, the government union's favored candidate, won the governor's race, and he promptly showed them the money.

Within months of his victory, he hiked the state income tax by two-thirds and raised business taxes by almost 50%. This hardly encouraged hiring; Illinois was one of the few states in which unemployment rose last year.

Walker's actions enraged government unions, which organized and funded the recall. But polls showed most voters supported the reforms once they took effect.

While the Wisconsin protests and recall attracted national attention, politicians from across the political spectrum have done the same thing around the country.

In deep-blue Massachusetts, Democratic Gov. Deval Patrick limited collective bargaining over municipal health benefits. The Democratic legislatures in Nevada and Colorado limited teacher tenure, as did Republican legislatures in Louisiana and Michigan. New Jersey's heavily Democratic legislature voted for a bill cutting government employees' pension and health benefits. Republican Gov. Chris Christie signed it.

It turns out that making government serve the people, instead of vice versa, isn't that radical after all.

James Sherk is senior policy analyst in labor economics at The Heritage Foundation.

This article first appeared in the Milwaukee-Wisconsin Journal Sentinel.