Tag Archives: President Clinton

Schwarzenegger’s “The Collectinator”: California’s bailout sequel

Governor Schwarzengger has resurrected a moniker. In 2003 he called himself “The Collectinator” for his promise to get money back from Washington, D.C. Now, the governor will seek several billion more to help California meet its $21 billion budget shortfall through 2011. His office argues that under President Clinton, California received 94 cents for every dollar it sent to Washington. Now it’s 78 cents. The claim is California is subsidizing programs in other states. Of course, it does not follow that the rest of the United States should subsidize decades of excessive in-state spending in California. To be sure Governor Schwarzenegger doesn’t have it easy. An Alameda Superior Court ruled yesterday that the Governor cannot furlough thousands of unionized state workers including members of the Services Employees International Union. The case is now headed to the state Supreme Court.

Mischievious Factions: The New Unionism

There are two Executive actions to remember when considering the fiscal straits of many state and municipal governments.

E.O. 10988, signed by President Kennedy in 1962 allowedpublic sector workers to unionize. Since 1962  public sector unionism has swelled, creating what Rutgers economist Leo Troy calls, “The New Unionism.” Today 36.8 percent  of public sector workers belong to a union. (Union participation is most dense on the local level at 42 percent.)

In 1993, President Clinton signed the Hatch Act Reform Amendments, allowing government workers to engage in political activities, such as fundraising.

Put them together and watch the near-bankrupting of California and New York, with New Jersey not far behind.

Unlike private sector unions which must negotiate with private owners, as Fred Siegel and Dan DiSavlo writing in The Weekly Standard point out…” public sector unions have no such counterweight. They are a classic case of client politics…with influence on both sides of the bargaining table.”

Public sector union workers campaign and vote for politicians who then control pay and benefit negotiations.

Seigel and DiSalvo recount how this worked in Washington State. In 2002 the Association of Federal, State, County, and Municipal Employees (AFSCME) got collective bargaining rules lifted. By 2005, their numbers doubled. More dues means more political influence. In 2004, Christine Gregorie was elected governor in a close race that was decided after AFSCME donated $250,000 for a recount. She quickly repaid the favor, negotiating salary contracts with double-digit increases.

The New Unionism is the faction politics that James Madison warns of in Federalist 10 – the only, “method for curing the mischeifs of the faction: the one by removing its causes, the other by controlling its effects.”

With the interests of politicians and their clients in such symbiosis, the extent to which such corrosive lobbying can be reversed depends on how much fiscal pain those ultimately paying for public services are willing to bear.