(From POLITICO…)
Public employee unions are emerging as public enemy number1 across the country.
Governors have made sporadic attempts over the past decade to fundamentally alter the spiraling pension costs that have consumed increasing shares of state budgets — and that legislatures in states like New York and California often sweetened as a gift to political allies.
The recent revenue crunch, though, has given governors and big-city mayors new leverage. The early initiatives have largely been stopgap measures: everything from furloughs in the two biggest states, New York and California, to initiatives like Bloomberg’s deal last week with teachers unions to cancel raises in exchange for avoiding layoffs.
Other executives have won larger, structural changes. Illinois Gov. Pat Quinn, a Democrat, signed into law last month a bill changing benefits for all five of the state’s pension systems — raising the retirement age, limiting pension raises, capping maximum benefits and ending public pensions for people who work in another public job.
California, however, remains ground zero for pension fights, as the seat of both the nation’s highest-profile budget crises and some of its most powerful public unions. Republican Gov. Arnold Schwarzenegger has been fighting them since he took office, and they have handed him his most stinging political defeats.
Now, though, Schwarzenegger — in his last months as governor — is gearing up for what he views as a final, climactic battle over public-sector pensions.
“The atmosphere has changed,” Schwarzenegger told POLITICO. “People understand that they have to lay off their workers or they don’t have the money for their family. What they don’t like is when there is a certain group that doesn’t like to make the sacrifices.”
Schwarzenegger said he “will not sign” a budget without pension reform.
“I will hold up the budget. It doesn’t matter how long it drags [on] — into the summer or fall or into November or after my administration — and I think the people will support that,” he said.
Schwarzenegger’s political judgment reflects a growing national consensus that public-sector unions may be at their most vulnerable point ever.
“The public mood is clearly changing regarding these issues,” said Minnesota Gov. Tim Pawlenty.
A likely 2012 presidential candidate, Pawlenty boasts of weathering a 44-day bus strike in 2004, the longest in the nation’s history. He recalled that during that “knock-down, drag-out brawl,” he shored up support by telling the public that “bus drivers under one version of their contract could get retirement benefits for the rest of their lives after working for just 15 years.”
“If you inform the public and workers in the private sector about the inflated benefits and compensation packages of public employees, and then you remind the taxpayers that they’re footing the bill for that, they get on the reform train pretty quickly,” Pawlenty told POLITICO.
The assault has caught the giant national unions that represent public employees largely flat-footed, and many leaders concede privately that they find themselves on defense.
“The Al Shankers and the Victor Gotbaums … they’re not around anymore,” said Norman Adler, former political director of the New York public workers union, referring to public-sector union leaders who battled through the crises of the 1960s. “The people who have replaced them are either not as sophisticated or not as talented as the old guard was.”
But a consultant to major unions pointed to a different, more structural shift: Public-sector unions are increasingly the face of American labor, and they have prospered as private-sector unions disappeared and workers’ wages stagnated.
“The face of labor today is now public employee unions whose wages and benefits largely outstrip those of average Americans,” the consultant said.
Democrats from Obama on down, however, have backed the pressure on teachers unions to drop inflexible work rules and accept private-sector-style merit pay. But the sharp attacks on the workers and their leaders remain largely a Republican theme. Illinois’s Quinn, for instance, who won a major victory over unions in pension changes (which apply only to workers hired starting next January) distanced himself from the Republican rhetoric.
“I don’t get involved in that kind of scapegoating; I don’t think it’s right,” he said, after hearing Daniels’s remark about a “privileged class.” “I respect public employees, I respect teachers, and I think they deserve a pension,” he said.
Quinn noted that pension liabilities had blossomed under the Republicans who governed Illinois from 1977 to 2002, and indeed, local Republicans from coast to coast have often accepted the support of unions and defended their perks. That day appears to be over, at least for now. Former eBay CEO Meg Whitman, campaigning to replace Schwarzenegger, has promised to cut 10 percent of the state work force, or 40,000 jobs.
The lingering question, however, is whether the turn against public-sector unions is here to stay. Union leaders hope that rising state revenues will ease the pressure, while Republicans insist there has been a deep shift in the perception of public workers and even of typically popular teachers.
“The question now is, is there going to be a paradigm shift?” said E.J. McMahon, director of the conservative Empire Center for New York State Policy.
“Or are the unions simply going to hunker down, let the wave wash over them and emerge stronger than ever?”