Union Bribery
by Bill Sizemore

All across this nation, state and local government taxpayers are being sold down the river by politicians, who hold public office primarily because public employee unions gave them huge campaign contributions and provided the foot soldiers for their campaigns.  The problem is, after these politicians are elected, they repay the unions for putting them in office by negotiating generous labor contracts with them at taxpayer expense.

It is likely that in every state in the union, the cost of government is billions of dollars greater than it ought to be because of the corrupting influence of these political contributions.

There are two terms that aptly describe this quid pro quo arrangement: bribery and conflict of interest.  In fact, the conflict of interest is so odious that if a private sector union official was caught giving money to someone in management, who negotiates contracts with the union, it would be a felony and the union official and the member of management who took the money would likely go to prison.

It is the essence of collective bargaining that two opposing sides come to the table as adversaries, one representing management, the owners or the shareholders, and the other representing the employees.  Management naturally wants to maximize profits and the return on investment for the shareholders.  The other side, the union, wants to win for the employees of the company a larger share of the company's profits in the form of higher wages and more generous benefits.

These two sides meet in a room and each attempts to negotiate a contract that is in the best interest of the side it represents.  It is generally understood that both sides must negotiate within the constraints of economic reality.  In other words, management must pay enough to attract and retain an adequate workforce and labor must recognize that if it negotiates wages so high that the company loses its competitive edge, the business could fold; in which case all of the employees would lose their jobs.

The restraining effect of economic reality is so ominous that it almost goes without saying that it shapes the context of the discussions and substantially limits what each side can give or take.  Over the years, several large American companies and powerful labor unions have gone too far in one direction or the other and thereby proved just how merciless economic reality can be, ending up in long drawn out, sometime crippling strikes or going into bankruptcy or receivership.

In the collective bargaining process, if things go according to theory, management and unions will be successful at finding that elusive middle ground where both sides are as unhappy with the result as they are happy and they both move on with the business of business.

What goes on in the public sector, however, all but obliterates the natural balance between management and labor.  In effect, by donating money to the campaigns of the officeholders with whom they will later negotiate labor agreements, public employee unions literally purchase the other side of the bargaining table.  In other words, they do not have to bargain with an adversary, but with someone whom they put in office.

The conflict of interest this creates could not be more obvious.  After the election, the unions sit across the table and negotiate wages and benefits with someone who (1) owes them an enormous debt, and (2) can give in to their demands and repay them with tax dollars instead of company profits.

This is a formula for public sector economic chaos.  These "legal bribes" virtually guarantees that government will grow, taxes will increase, and the taxpayers will receive the least for their money.

I know of a governor here in Oregon, who immediately after being elected had to negotiate a labor agreement with state employees.  Those employees were represented by a public employee union that had been very instrumental in the governor's election.  Before the negotiations commenced, the leader of the governor's negotiating team commissioned a study to determine what kind of salary adjustments were in order.  When the study was completed, it was presented to the governor with the recommendation that no pay raises be offered to state employees, because the study made it clear that when both salaries and benefits were considered, state workers already were being paid more than their private sector counterparts.

The governor responded by taking the study, which cost thousands of dollars to prepare, and without so much as opening it, tossed it into the nearest trashcan.  Why?  Because the governor owed the public employee unions for helping win the election and could not repay them with a pay freeze, even if on the merits no pay raise could be justified.

The taxpayers were sold down the river, because the governor had a conflict of interest.   To put it bluntly, but fairly, the governor had been bribed.

The tragedy in all this is that these political donations, which create such an obvious conflict of interest, are in most places legal.

This past election, Oregon held another election for governor.  The Democrat incumbent won handily and announced afterwards that he owed his victory to the public employee unions, which in fact had donated quite generously to his campaign and worked hard to get out the vote for "their guy".  Let me ask you this:  How do you think the bargaining with state employees will go this budget cycle?  Do you think the governor will hold the line on wages and benefits for state workers?  Do you think he will drive a hard bargain?

If it is any clue to the way things will go, consider this:  After the election, the governor appointed a new chief of staff and a new deputy chief of staff.  The new chief of staff was recently the top lobbyist for the OEA, the state teachers union, and the new deputy was for many years the Oregon head of the AFL-CIO.  With a staff consisting of former union leaders, who will be looking out for the taxpayers and protecting their interests when the governor or his representative sits down at the bargaining table with the unions?  Certainly no one in that incestuous group.

This problem is pervasive and affects taxpayers in a host of ways.  Here in Oregon, public employees routinely retire several years earlier than their private sector counterparts (averaging age 52 for public safety workers and age 57 for other public employees). Public employees not only retire early, but their pensions are so generous that career public employees usually receive pensions that exceed by a substantial amount the highest salary they ever received when they worked full time.  Try finding that kind of pension in the private sector.

Oregon's public employee retirement system (PERS) is literally breaking the state, crowding classrooms; reducing the number of police officers, firefighters, and prison guards; even forcing the early release of convicted felons.  And why do you suppose public pensions are so generous?

The answer is obvious.  Democrat politicians, who receive about 98 percent of public employee union political contributions, have repaid their union friends with enormous favors at taxpayer expense.  (Please do not take offense at the fact that I name Democrats as the culprit here.  I cannot honestly blame Republicans for this problem when Democrats receive 98 percent of public employee union money.)

If you stand back and look at the status quo, you have to admit that these "bribes" have been a good investment for the unions and their members. The unions donate a few million dollars every election to the right candidates and then receive in return hundreds of millions, even billions of dollars in overly generous salaries and benefits for their members.

It's good business for them, though one gets the feeling that they are the shearers and we taxpayers are merely the sheep. Members of organized crime should have it so good.

Are taxpayers savvy enough to catch on to what's happening to them and do something about it?  In Oregon, they are going to have a chance.  I have filed a measure to make it illegal for a public employee union to make political contributions to candidates for any office that would later negotiate contracts with the union or approve the budgets from which those contracts would be funded.

I expect a war over this measure.  Unions like owning both sides of the bargaining table and politicians like receiving huge contributions from one source that they can repay with other people's money.  Neither will give up their cozy relationship without a fight.

If nothing else, the discussion that will ensue from this measure's presence on the ballot will make people realize exactly what is going on today, i.e., bribery and conflict of interest on a wholesale scale.  This measure will force a long overdue wake-up call for the voters and taxpayers of Oregon.

Bill Sizemore is Preisdent of the Oregon Taxpayers Union