Right-wing media have falsely suggested that collective bargaining for public unions is driving states' budget shortfalls. In fact, there is no correlation between collective bargaining and state budget deficits.
Right-Wing Media Suggest Public Union Collective Bargaining Is Driving States' Budget Shortfalls
Kilmeade Suggests That “Union Bargaining Should Be Abolished All Together” Because It's “Breaking The Public Piggy Bank.” On the February 28 edition of Fox News' Fox & Friends, co-host Brian Kilmeade asked, “If union bargaining is breaking the public piggy bank, should it be abolished all together?” [Fox News' Fox & Friends, 2/28/11]
Liz Cheney: Collective Bargaining “Reduces [Local Officials'] Ability To Actually Manage Their Own Budget.” On the February 20 edition of Fox Broadcasting Co.'s Fox News Sunday, Liz Cheney stated that “when you've got collective bargaining in place and when you've got the benefits that are basically sealed in, and no ability by those local officials to touch those or affect them, it reduces their ability to actually manage their own budget.” [Fox Broadcasting Co.'s Fox News Sunday, 2/20/11, accessed via Nexis]
Wallace Lets Walker Suggest That Collective Bargaining Is Preventing States From Balancing Budgets. On the February 20 edition of Fox News Sunday, Chris Wallace hosted Wisconsin Gov. Scott Walker to claim that state governments are facing budget crises because of collective bargaining. From Fox News Sunday:
WALLACE: Yes, but I don't understand. If it's a money issue and balancing the budget and they are willing to concede on the money issues, why isn't that enough? Why do you also have to take back some of their collective bargaining rights?
WALKER: Well, they aren't because, in the end, they can say that, but that's really a red herring. The same groups back in December, after election, before I was sworn in, tried to ram through literally in a lame duck session employee contracts that would have locked things in before I got there. So, they're not really interested. But more critically, I was a county executive, an elected official in Milwaukee County, a county that's never elected Republicans before -- I was there for three different elections because we tried to tackle these very same issues.
And what stood in the way time and time again was collective bargaining. We've got over 1,000 municipalities, 424 school districts, about 72 counties in the state, all of which need to have the power to be able to offset what's going to happen in Wisconsin next week, just like New York, in California, wherever else, has been doing, and that's cutting billions of dollars from local governments.
The difference is, unlike those other states, I want to give those local governments the tools they need to balance the budget now and in the future. They can't do that with the current collective bargaining laws in the state. [Fox News Sunday, 2/20/11, accessed via Nexis]
In Fact, Every State That Explicitly Prohibits Collective Bargaining Faces Budget Shortfalls
Five States Explicitly Prohibit Collective Bargaining. According to the National Council on Teacher Quality (NCTQ), five states -- Texas, Georgia, South Carolina, North Carolina, and Virginia - have made collective bargaining explicitly illegal.
[National Council on Teacher Quality, accessed 3/1/11]
CBPP Data Show All Five States In Which Bargaining Is Illegal Face Budget Shortfalls. According to data compiled by the Center for Budget and Policy Priorities (CBPP), the five states in which collective bargaining is explicitly illegal all face budget shortfalls in FY2012. According to CBPP, Texas and North Carolina are at or above the average expected state budget shortfall in FY2012. [CBPP, 2/10/11]
CBPP Data Shows Five States Are Not Anticipating Shortfalls In Coming Year -- All Of Them Allow Some Form Of Collective Bargaining. According to CBPP data, Wyoming, North Dakota, Arkansas, Alabama, and Alaska are currently not anticipating budget shortfalls in the coming year. Each of these states allows some form of collective bargaining. From CBPP:
McCartin: Contention That “We Can No Longer Afford Collective Bargaining” Is “Bogus.” In a February 19 New Republic article, Joseph McCartin, an associate professor of history and director of the Kalmanovitz Initiative for Labor and the Working Poor at Georgetown University, wrote that the contention that "[w]e can no longer afford collective bargaining" is “bogus”:
[I]n the midst of the worst economic crisis since the Great Depression, conservative, anti-labor politicians like Governor Walker are trying out a new and potentially more potent anti-union argument: We can no longer afford collective bargaining. The wages, health benefits, and pensions of government workers, these opponents say, are driving states into deep and dangerous deficits.
Yet this contention is every bit as bogus as the alarmist arguments put forth by the anti-union crusaders of the 1970s. Contrary to Walker's assertion, there is no direct correlation between public-sector collective bargaining and yawning state budget deficits. According to data gathered by the Center for Budget and Policy Priorities, while Wisconsin projects a state budget deficit of 12.8 percent for FY 2012, North Carolina, which does not allow government workers to bargain, faces a significantly higher deficit: 20 percent. Ohio, whose Republican governor John Kasich has also made clear his desire to roll back collective bargaining, has a deficit that is only about half the size of non-union North Carolina's. Clearly, then, state budget deficits we are now witnessing are not the product of collective bargaining, but rather reflect the differential impact of the current recession on individual states, as well as the integrity of state fiscal practices (such as whether they raise enough in taxes to pay for the essential services they provide). [The New Republic, 2/19/11, italics in original]
Tapper: “There Is No Correlation” Between Collective Bargaining Rights And State Deficits. On the February 27 edition of ABC's This Week, guest-host Jake Tapper stated: “There is no correlation, according to statistics, between a state's ability to collectively bargain with its public employees and whether or not they have a budget deficit.” Tapper also cited McCartin's New Republic article. [ABC's This Week, 2/27/11]
Toledo Law Professor: “There's No Correlation Between Collective Bargaining And The State Budget Crises.” A February 28 Fortune article quoted Toledo law professor Joseph Slater as saying: “It's easy to paint a portrait of public workers as overpaid, not working very hard and being fat cats on the tax dollar. But there's no correlation between collective bargaining and the state budget crises.” He further rebutted the claim that state pension obligations are the result of collective bargaining:
Union critics, such as James Sherk, a labor economist at the conservative Heritage Foundation, call union benefits “gold-plated” and far more generous than what other workers receive -- using money, he maintains, that should be spent on services or returned to taxpayers.
Public unions, he says, “don't negotiate over how to divide profits, they negotiate for the government to spend more on their members.”
Despite what are viewed as steep overruns generated by public benefits programs, are unions and public employee benefits really to blame for the enormous budget crises throughout the nation?
“Unionized workers didn't sow the seeds of the economic downturn, deregulation of the financial industry did,” says Robert Bruno, a University of Illinois professor of labor and employment relations. “We've suffered billions in losses because of greed, gross mismanagement and illegal activity in the financial industry.”
“Unions are an easy target because the largest cost in a state budget is always labor,” says Bruno, who studies employee and union issues. “Why are we scapegoating teachers? Is the American love affair with capitalism so irrational that it knows no bounds?”
Joseph Slater at Toledo's law school agrees: “It's easy to paint a portrait of public workers as overpaid, not working very hard and being fat cats on the tax dollar. But there's no correlation between collective bargaining and the state budget crises.”
For example, huge state pension obligations - which have grabbed headlines because of state underfunding, and which Sherk points to as a major deficit-maker for states, are not the result of collective bargaining.
“The vast majority of states have pensions set by law, not by collective bargaining,” Slater says. “So it's a common misperception that these costs are a result of collective bargaining.” [Fortune, 2/28/11]