Thursday, December 29, 2005

Bargaining chips

I don't normally have much sympathy for public-sector unions. They have a disproportionate influence over the collective bargaining process, particularly when compared to their private-sector cousins. For one, the government usually has a monopoly on the services it offers, so when workers strike--which sometimes is illegal--customers, i.e., taxpayers, have no alternatives. Also, public employee unions, through the electoral process, can help to hire or fire the people with whom they bargain--elected officials and their appointees. (See this post.)

That said, I have to agree with Fester's assessment of the New York Metropolitan Transit Authority's last-minute demand that new transit workers contribute 6 percent to their pensions, up from 2 percent for current workers. That demand prompted the transit union's strike--an illegal strike, I might add--which brought New York City to its knees and forced the authority to make rather hefty concessions.

Despite having to contribute toward their health insurance for the first time, the union was the big winner in this dispute, and the loser, as is often the case, was the taxpayers who consume government services, as is noted in this New York Times article:

"If someone didn't do well in this settlement, it was probably the riding public," said Raymond D. Horton, a professor at Columbia Business School, complaining that the deal did little to hold down costs or increase productivity.

In early talks, the authority made a big issue of increasing productivity by, for example, calling for station agents to empty trash cans and station cleaners to change light bulbs and paint over graffiti. But the union got those demands dropped.

"The M.T.A. had three goals: health premiums, pensions and productivity," Mr. Brecher said. "They got one out of three - that's a far better batting average than many people get in bargaining with municipal unions."


Blogger Ol' Froth said...

Pensions and health care are deferred and alternate compensation. I have a hard time when any employer, public or private, renages on health care, when that was clearly a part of the total compensation package when the employee was hired. I ahve a much harder time when employers renege on pensions, which are, at their heart, deferred compensation. Reducing pension benefits is equivilant to stealing.

If the employer, public or private, fully and completly compensated the worker for the value of the lost pension and health care, well, maybe there could be some give and take.

5:26 PM

Blogger Jonathan Potts said...

I agree that promises made should be honored. But it seems to that you live under a collective bargaining agreement, all compensation is on the table everytime a contract expires. I think the public sector needs to adjust to some economic realities. Although perhaps if powerful public employee unions start to feel the pinch of rising health care costs, they'll pressure lawmakers to do something to address our nation's health care mess.

10:55 AM


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