MEANINGFUL PENSION REFORM NOT LIKELY FROM UNDER THE DOME
The Sacramento Bee Capitol Alert Blog reports that tomorrow Governor Brown is going to announce some sort of public employee pension reform plan. The presumption is that Brown is going to formalize what he referred to last March as his “no loggerheads” faux pension reform — the folly of which I wrote about at the time. This is where you throw out some common sense ideas to curb some egregious abuses of the system, maybe combined with some changes for new hires. The problem, of course, is that there is only one real yardstick to measure a public employee pension reform proposal…
Last year a study out of Stanford University pegged the state’s unfunded pension liability at a 500 billion dollars – a vast some. Meaningful reform must be measured on how big a reduction in that liability occurs with its adoption. Earlier this month I wrote about the challenge ahead for the Governor.
As a practical matter, the public employee unions with their massive PAC spending “own” the state legislature. Unless Brown intends on circumventing the legislature and placing meaningful reform that significantly reduced benefits for remaining years of service for current employees on the November, 2012 ballot via initiative — don’t get too excited about his announcement on Thursday.
HIRING OUTSIDE LABOR NEGOTIATORS
The city of Costa Mesa has just hired an outside negotiator to deal with public employee labor negotiations. Orange County has just issued an RFP to do the same. This practice should be in place in every local government in California, if you think about it. If you don’t hire an outside negotiator, then by definition the person who is handling negotiations is an employee at some level with the government entity. This individual has a huge conflict of interest because when the employees in the city get higher wages and more benefits, invariably that leads to more compensation for management as well.
Of course, many local governments have the same problem that afflicts state government — which is a corrupt system where the public employee unions spend vast sums of money on political contributions and independent expenditures to hand-pick elected officials. The net effect of this is that both sides of the negotiating table in many instances are controlled by the public employees, and the taxpayers find themselves in the awkward position of being unrepresented in the process.
California voters will be able to do something about this terrible status quo next year when the Stop Special Interest Money Now ballot measure appears before them. That measure would ban both corporate and labor union contributions to candidates, prohibit government contractors from contributing money to government officials who award them contracts, prohibit corporations and labor unions from collecting political funds from employees and union members using the inherently coercive means of payroll deduction, and make all employee political contributions by any other means strictly voluntary, requiring annual written consent.
END COLLECTIVE BARGAINING FOR PUBLIC EMPLOYEES
Patt “The Hat” Morrison recently interviewed Lanny Ebenstein, a professor of Economics at the University of California, Santa Barbara, in her Los Angeles Times column. Ebenstein is very cogent when he makes the case for while public employees certainly have the right to unionize, it is poor public policy to allow those public employee unions the right to collective bargaining… The interview is definitely worth a read.
I support an end to collective bargaining for public employees for one simple reason. Elected officials are “hired” by the public to be decision makers on fiscal issues. Public sector collective bargaining sets up a system where elected officials are no longer the decision makers. If the public employee union bosses do not agree with the decisions of the elected policy makers, they can take contracts to impasse and suddenly an unelected arbitrator is the decision-maker, making important decisions about the salary and benefits of public workers, paid for with taxpayer funds.