Are public sector unions different?
UNIONS, what are they good for? That's the talk, these days, as people around the country choose sides in the battle between Wisconsin Governor Scott Walker and the state's public employees. One of threads of the discussion has turned to whether there is a difference between private-sector unions and their public-sector counterparts. My colleague at Democracy in America says there is:It is in the context of these concerns that we must consider the function of public-sector unions. If they do anything at all, it is to protect their members' claims on future government revenue from democratic discretion—to limit the power of the elected representatives of the democratic public to set the terms on which union-members will receive transfers from taxpayers. That these transfers come to workers in the form of compensation for services rendered the government seems to confuse a lot people. This is, I think, why people on both sides of the debate are distracted by the question of whether government workers are or are not "overpaid". To my mind, the real question is whether government workers should be granted special legal powers that (a) are unavailable to other groups whose welfare also turns on transfers from the treasury, or on the size of compulsory transfers from their bank accounts to the treasury, and (b) limit democratic sovereignty over the distribution of the burdens and benefits of the system of public finance.I would argue on liberal grounds that justice demands limits on democratic sovereignty over budgetary matters precisely to avoid the exploitative redistribution that otherwise occurs. That's why I support constitutionalising nondiscrimination requirements on fiscal policy, among other reforms. My principled objection to public-sector unions is that their powers limit democratic sovereignty over taxation and public spending in a way that advantages some citizens at the expence of others—in a way that makes fiscal exploitation more, not less likely. Should they have grievances about their cut of the public budget, non-unionised government employees have recourse to the exact same democratic institutions as do other groups of citizens, which is as it should be. If we cannot trust democratic bodies to treat government workers fairly, then we cannot trust democratic bodies generally.Emphasis mine. Hm. Let's try this reformulation:If we cannot trust private firms to treat workers fairly, then we cannot trust private firms generally.But of course, we trust private firms to do some things while at the same time relying on unions, regulators, and other organisations to make sure that those firms treat workers fairly. Because we don't necessarily trust them to do it on their own. Because they haven't in the past.The idea that democratic governments are above similar kinds of exploitation strikes me as odd. Of course they aren't. Democratic governments do all kinds of terrible things. They steal and kill and torture. Does overworking and underpaying labour seem so dastardly by comparison? But that doesn't lead us to give up on them entirely; rather we try to build institutions that check the worst impulses of government. And that's the charitable argument for public-sector unions: that public-sector workers, like all workers, have the right to organise to push for better working conditions.Yes, improvements in pay in the public sector will come directly out of taxpayer pockets. To the extent that this serves to check the democratic impulse to treat workers badly—and there are far worse democratic impulses than that out there—that's entirely justified.If there's a difference in the kind of unions, it's that markets place a check on private union behaviour. If a private-sector union succeeds in capturing all the available surplus generated by the employing industry, and then demands more, the industry will collapse. Firms will go bankrupt. There isn't a natural constraint on public-sector wages and benefits in the same way. The political process has to act to limit increasing compensation to public workers. That's basically what's happening now. It's not surprising that some measure of public anger is associated with this process, or that some parts of the citizenry would call for an end to public-sector unions.If that's what happens, then that's what happens. But it would be nice if vulnerable-feeling Americans recognised themselves in public-sector workers. Those workers unionised, at least in theory, to prevent their employers—American taxpayers—from giving them a raw deal. You'd think that a lot of American workers would emphathise with the sentiment.