Commentary Magazine


Contentions

Private Sector Voicing Outrage at Bankrolling Public-Employee Benefits

Unions are a declining factor in the U.S. economy, but they still wield enormous political clout. Only about 7 percent of American workers in the private sector are union members, while 37.4 percent of public employees belong to unions. But unions have played an outsize role in American politics by bankrolling Democratic candidates for decades. And Democratic lawmakers have repaid union support by providing generous salaries and benefits for state and municipal workers.

But there is growing resentment among the public at this arrangement, as Gov. Tim Pawlenty points out in an op-ed in today’s Wall Street Journal. Public-employee unions are becoming a huge burden for workers in the private sector, who must pay higher taxes for public-employee salaries, benefits, and pensions that are far more generous than they themselves enjoy.

According to one study, the present value of unfunded liabilities for local-government pensions amounts to $7,000 per municipal household in 2009 (using local-government accounting methods), but the actual cost may be much higher. Several states are already trying to rein in public-employee benefits, according to this Bloomberg Businessweek piece:

Already this year, 16 states have required public employees to pay more into retirement plans or cut benefits for new hires. Nine states increased the number of years new hires must work to earn full retirement benefits. Two states, Missouri and Illinois, raised the retirement age to 67. California’s new budget requires current state workers to contribute more toward their retirement and rolls back new hires’ pension benefits to 1998 levels.

With Republican governors now in control of 30 states, and the GOP in control of legislatures in 25 states (with Dems in control in only 16), public-employee unions may have a real battle on their hands.  And even with the money unions spent in the last election — $91 million in direct contributions, going almost entirely to Democrats — they weren’t able to overcome public outrage. But don’t expect unions to rethink their strategy; the likelihood is they’ll double-down in 2012.


Join the discussion…

Are you a subscriber? Log in to comment »

Not a subscriber? Join the discussion today, subscribe to Commentary »





Welcome to Commentary Magazine.
We hope you enjoy your visit.
As a visitor to our site, you are allowed 8 free articles this month.
This is your first of 8 free articles.

If you are already a digital subscriber, log in here »

Print subscriber? For free access to the website and iPad, register here »

To subscribe, click here to see our subscription offers »

Please note this is an advertisement skip this ad
Clearly, you have a passion for ideas.
Subscribe today for unlimited digital access to the publication that shapes the minds of the people who shape our world.
Get for just
YOU HAVE READ OF 8 FREE ARTICLES THIS MONTH.
FOR JUST
YOU HAVE READ OF 8 FREE ARTICLES THIS MONTH.
FOR JUST
Welcome to Commentary Magazine.
We hope you enjoy your visit.
As a visitor, you are allowed 8 free articles.
This is your first article.
You have read of 8 free articles this month.
YOU HAVE READ 8 OF 8
FREE ARTICLES THIS MONTH.
for full access to
CommentaryMagazine.com
INCLUDES FULL ACCESS TO:
Digital subscriber?
Print subscriber? Get free access »
Call to subscribe: 1-800-829-6270
You can also subscribe
on your computer at
CommentaryMagazine.com.
LOG IN WITH YOUR
COMMENTARY MAGAZINE ID
Don't have a CommentaryMagazine.com log in?
CREATE A COMMENTARY
LOG IN ID
Enter you email address and password below. A confirmation email will be sent to the email address that you provide.