Wednesday, March 2, 2011

How Different is Michigan from Wisconsin?

11 comments:

  1. Unfortunately, those with whom public employee unions collectively bargain have a very weak motivation--because it's not their money, and they're usually not subject to an effective feedback loop--to get the best deal for the ultimate employer, the taxpayers. Even a trivial review of history illustrates a consistent pattern of unbalanced outcomes in such negotiating.

    Thus over time, the total compensation of unionized public employees has tended to gradually increase relative to that of private sector employees of similar education and skillsets.

    Strong unions often accomplish this. The same thing happened in the automotive, steel, chemical and trucking industries, with employees in those industries effectively exerting their collective power to cause their total compensation to progressively increase relative to other private sector employees with similar education and skills. Of course, large parts of the automotive, steel and chemical industries were cost-motivated to move out of the US, and US truckers have a lot of nonunion competition these days. Many public sector workers are protected from that factor by their effective representation-monopoly.

    Arguably, this distortion over time of a socially viable system of relative compensation is just as undesirable as the distortions from changes to the tax codes and from other economic patterns. One effect on display in the current dispute is that public employees regard themselves as insulated from economic setbacks suffered by the private sector and reflected in public tax collections.

    My personal view is that it was a mistake from the beginning to have public employee total compensation negotiated. Instead it should have been rigidly linked to the COL index and to tax collections. That, of course, is an even more radical course than what Governor Walker advocates. Implementing it now would disrupt the lives of a lot of valuable folks.

    The Wisconsin, Indiana and Ohio situations are pretty much the flip side of what happened to the auto industry. Fortunately for the UAW, their crunch-time was managed by Democrats who protected them while others took the hit. Republicans advocate a different approach. It neatly illustrates how elections have consequences, and how our system of government works.

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  2. JWilly...Here Here!

    It's not unreasonable for public workers to only get what the private sector worker is getting. I have never understood why anyone should think they have a right to retire after 30 short years of work. My Grandfather worked at Buick for 30 years, retired at 55, then collected a pension for 40 more years. When he died, my grandmother collected it for another 7 years till she died. That’s 77 years of pay and benefits for 30 years of work. Anyone who can add 2 + 2 can figure out quickly that it doesn't make any sense. And why should someone from the private sector, who does not get a pension, be expected to pay for public employees who do.

    Let's be fare not ignorant.

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  3. I wish moderation and centrism was the winner more often in our pick-your-poison two-party system.

    If we're going to symbolically and practically whack unionism in this way, maybe it'd be a good idea to simultaneously review why it is that average senior management total compensation is so much larger a multiple of average hourly worker compensation in so many industries than it was in say the late 1950s.

    The social model of a few rich managers living in luxurious walled compounds while the middle class struggles and the working class barely gets by, hasn't worked well elsewhere. Maybe it would be a good idea for the US to do something about our uncontrolled drift in that direction.

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  4. Videos like this add absolutely nothing to what should be an adult debate. The video keeps throwing around the world "democracy", but when a group claims the money of another group as a right, that is not democracy. If it were, then we should all support enslaving 49% of the population in order to support the other 51%.

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  5. This is one of the best videos I've ever seen created of the demonstrations in Madison and makes the unions sound like they are the greatest things since sliced bread and that Governor Walker is just an evil little man. You can almost hear Woodie Guthrie tuning up his guitar. However, it does very little to get to the central point that Walker is trying to make...that it is nearly impossible to stop the insane spending that goes on in union-controlled cities and states. How about comparing Michigan to Texas instead of Wisconsin and try explaining why their citizens pay half the taxes per-capita that we do. Try explaining why businesses and people are flocking to their state and leaving ours (and don't use the weather as an excuse 'cause its hotter than a mother down there in the summer). Look at the article written by Mark McKinnon in Newsweek (a liberal leaning publication) this week which explains how unions bully the taxpayer. And, finally, look no further than the story on the front page of this week's Sunday Flint Journal which describes how the city in its infinite wisdom is going to spend an average of $195,000 per house to build the Smith Village subdivision and sell them for between $50,000-$70,000. This in a city where the average sales price of a home over the past year was reported in the same paper to be around $15,000. These are the reasons why people hate the government and don't care to give it any more money than they possibly can.

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  6. Anonymous Anonymous said...

    It's called collective bargaining. That means cities and states can always say no. If they don't, and you don't like it, then vote the politicians out of office. That's how it works. You don't simply get rid of collective bargaining.

    And while I agree with lots of your specifics on Flint, you're on thin ice when you start using Texas as a model. They have insane crime, horrible education levels, and high poverty levels and...the state is also broke. Not someplace I'd ever want to live.

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  7. Just for the record, I'd hardly call Newsweek "liberal leaning." Pretty much every mainstream national publication, including the lovable NY Times is right of center.

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  8. So, you guys say that Texas has insane crime, horrible education levels, high poverty levels, and the state is broke but we don't have any of these things here in Flint and Michigan.
    Hmmmm...
    And The New York Times is a right of center newspaper.
    Hmmmm...
    I think I'll just stick to clicking on the comments about one of Gordie's reminiscent Halo Burger posts...those people sound a lot safer.

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  9. Hey, this just proves that people love Halo Burger, regardless of their political persuasion or stance on unions!

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  10. As far as paper leanings... it depends what you're used to... I always thought NYTimes leaned to the left... but after reading the Village Voice, I could see someone saying NYTimes leans to the right. It's sort of like the lilt of a ship.

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  11. Someone in the video said they haven't heard a logical reason why Wisconsin should get rid of collective bargaining. Well JWilly just gave that reason quite logically and quite accurately.

    Anonymous from March 7, 2011 10:06 AM said "It's called collective bargaining. That means cities and states can always say no. If they don't, and you don't like it, then vote the politicians out of office. That's how it works. You don't simply get rid of collective bargaining."

    That point of view seems very quaint, but it neglects the fact that these same unions contribute to the campaigns of the very politicians with whom they're collectively bargaining. So who is looking out for the shareholders who are, in this case, the taxpayers? You are asking for taxpayers to do their own collective bargaining by using the ballot box, which widens the feedback loop to an extent that it's meaningless.

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