Trey Kovacs

Government officials mismanaging public funds is nothing new. But giving public pensions to private lobbyists is a new low.

A recent Associated Press report uncovered that at least 20 states supply private lobbyists with public pensions and sometimes health care benefits. In some cases, the states have provided this absurd benefit for decades. Worse, but not surprising, much of the activity these lobbyists carry out conflicts with taxpayer interests.

In today’s Milwaukee-Wisconsin Journal Sentinel, I note that government has a long history of inappropriately spending public funds:

For example, in the 19th century many states went on a spending binge by investing heavily in private railroads, canals and other infrastructure projects that ultimately went bankrupt and left taxpayers stuck with the bill. States defaulted on their debt obligations 17 times. Municipalities were also in the same spending game.

But at one point in U.S. history, state elected officials realized the error in their ways:

Finally, state lawmakers sought options to protect taxpayers from the temptation of legislators to give away taxpayer funds to private interests. Their solution, in at least 45 states, was to enact a constitutional provision known as the “Gift Clause,” which forbids public subsidies to private entities.

Fortunately, state constitutional provisions against corporate welfare are still on the books. And the Goldwater Institute, a free-market think tank in Arizona, has had success in enforcing the letter of its state’s Gift Clause. Arizona’s Gift Clause states that no state or local government agency “shall make any donation or grant, by subsidy or otherwise, to any individual, association or corporation.”

Arizona courts have ruled:

To determine whether public funds aiding private interests violate the Arizona Gift Clause, Arizona courts have come up with a two-part analysis that must be satisfied: (1) The expenditures of public funds must promote a public purpose. (2) The public entity must receive proportionate, quantifiable and direct benefit for the aid given.

Obviously, granting public pensions to lobbyists fails the Gift Clause test. Especially when these individuals never perform government duties and serve private interests.

As I conclude in my op-ed, “The good news is that nearly all 20 states that offer public pensions to private entities have a Gift Clause in their constitution. It is time to put them to use for the protection of the taxpayer.”

Post image for Maryland Bill Will Force Teachers To Pay For The Privilege Of Going To Work

In a recent Baltimore Sun op-ed and WorkplaceChoice.org blog post, I argue against Maryland’s Orwellian-named Fair Share Act, which contrary to its name is unfair and coercive in nature. The bill (currently waiting for Gov. Martin O’Malley’s signature) would make payments to teachers unions compulsory, whether a member or not, throughout all Maryland Public School Districts.

If passed into law, it would require all school districts to negotiate with the Maryland State Education Association to set a service fee to “cover” non-union members’ representation costs. Currently only 10 of Maryland’s 24 school districts require non-union teachers to pay union dues.

In the Sun I ask the questions:

But what if teachers don’t want this type of “equity”? What if they don’t want to join a union? What if they want to negotiate their own contract? Why shouldn’t they be allowed to do so?

Well, according to the Baltimore County Union President Abby Beytiun those are illegitimate concerns. In her letter to the editor published in the Baltimore Sun she responds with this doozy:

The Fair Share legislation will create an environment of fairness and equity among all of our educators, who all contribute to the negotiated benefits and legally required representation that they all enjoy. By state mandate, the union must represent all members of the bargaining unit in negotiations and contractual issues.

First, Beytiun’s proposition that state-granted power of coercion to garnish teachers wages as fair is more than disingenuous.

Second, Maryland and most other states already bill taxpayers for representational services provided by government-employee unions to nonmembers. The practice is known as union release time or “official time,” and it allows government employees to perform union duties during their workday.

In addition, through Maryland’s Public Information Act, the Competitive Enterprise Institute obtained union release-time records for nine of the 10 school districts that already require forced union dues. Here are the number of days taken for official time in 2011-2012:

  • Allegany County: 81.5 days
  • Anne Arundel County: 209 days
  • Baltimore City: 84 days
  • Baltimore County: 60 days
  • Calvert County: 120 days
  • Charles County: 31.8 days
  • Garrett County: 17.5 days
  • Howard County: 48 days
  • Prince George’s County: 322 days

Visit WorkplaceChoice.org to view the union release time public records requests in their entirety.

We know the story of Chicken Little. The little chick thought the sky was falling because he was hit in the head by an acorn. He convinced the other barnyard animals that the sky was falling and soon they were all in hysterics.

Well, when it comes to sequestration cuts impact on federal employees, union officials have adopted a Chicken Little approach. Feeding Big Labor’s frenzy is tomorrow’s March 1 sequestration deadline with no deal to delay budget cuts in sight.

For the past few weeks, federal union leaders have been lobbying anyone who will listen to deflect cuts away from federal workers in favor of anything else. Today in U.S. News and World Report, I criticize these union officials, which many never do any government work:

When President Carter signed the Civil Service Reform Act in 1978, he said he did so to “promote the general welfare, contribute to the effective conduct of public business and to facilitate and encourage amicable settlements of labor-management disputes.” He said nothing about creating dozens of jobs within government devoted solely to the conduct of union business. But that is precisely what has happened.

According to records obtained by Americans for Limited Government through Freedom of Information Act requests, the Department of Transportation had 35 employees who did nothing but union work in 2012, and the Environment Protection Agency had 17. All 52 made at least $72,000 per year, and 37 made more than $100,000.

[click to continue…]

In the aftermath of Hurricane Sandy, the New Jersey Senate has only passed one bill associated with rebuilding storm-damaged public infrastructure. Sadly, if passed, the bill would only inflate the cost of recovery efforts and future public works.

New Jersey Senate Bill 2425 would grant unions a monopoly on all Sandy reconstruction. It would do so by expanding the reach of what are known as project labor agreements (PLAs), which mandate firms hire union labor and agree to their work rules on all government construction projects. Unfortunately, PLAs have been shown to increase government construction costs to taxpayers and discriminate against non-union construction workers, who represent 86.7 percent of the trade nationally. Higher costs from PLAs lead to less construction, which is the last thing Sandy victims need to recover from the destruction.

PLAs create an uncompetitive bidding process in favor of unions, which invariably amounts to pure political payback from union-biased elected officials. It should be no surprise that SB 2425 sponsor Senator Steve Sweeney, according to the National Institute on Money in State Politics, received tens of thousands in campaign contributions from numerous construction unions in recent elections. Moreover, in Sweeney’s time away from public service, he moonlights as is an ironworker union organizer for which he is rewarded with over $50,000 annually for his services.

A 2010 New Jersey Labor Department study found that PLAs raised school construction costs by 30.5 percent per square foot. It also found that the average duration for PLA projects during fiscal year 2008 was 100 weeks, while for non-PLA projects it was 78 weeks.

[click to continue…]

Over the past year, the Midwest has had a pro-worker epiphany, a movement now reaching its crescendo with the imminent passage of right-to-work legislation in Michigan, which would end mandatory union dues as condition of employment in an historical union stronghold.

Unfortunately, accompanying the wave of workplace freedom has been a tsunami of union intimidation and impolitic tactics… and Michigan will be no different. The announcement of introducing right-to-work legislation on December 6 immediately prompted union protests at the state capitol building in Lansing. The Mackinac Center for Public Policy reports:

UAW members in neon green vests patrolled crowds inside and outside the state Capitol here, but it didn’t stop violence and vandalism.

“No, we don’t want anyone fighting,” a union member in a green vest shouted to a group of angry protestors approaching a small group of right-to-work supporters gathered on the steps of the Capitol. “Everyone stay cool.”

His plea went unanswered as about eight men wearing hats and coats with the logos of the UAW, Sheet Metal workers, Steelworkers, and other unions, pushed onto a platform on the stairs and shoved people back about three feet. The surge lasted for a few minutes and was one of a couple of such pushes that occured on Thursday.

The protests do not have an end in sight. Over the weekend, United Auto Workers President Bob King told hundreds of members, “They’ve awakened a sleeping giant.” The union, along with allies, will conduct protests all this week in an attempt to half Michigan’s adoption of a right-to-work law.

[click to continue…]

Post image for Looting The Future: Union Bosses Violate Spirit If Not Letter Of The Law

Hostess’ union-induced shutdown captures the essence of the modern labor movement–more anti-employer than pro-worker. Workers are taking notice of unions’ negative impact on employers, for example, the loss of jobs in the auto, airline, and steel industries — and now at Hostess.

As a result of union bosses’ self-interest trumping the well-being of its beneficiaries or law, private sector unionization has dropped to an all-time low of 6.6 percent. This statistic should not be shocking when considering the conduct of the Bakery, Confectionary, Tobacco Workers, and Grain Millers union (BCTGM) officials, who represented 5,000 Hostess workers, throughout the bankruptcy proceeding that put the company’s 18,500 workers out of a job just in time for the holidays.

Since January when Hostess filed for bankruptcy, BCTGM officials drew a line in the sand — no concessions — even if that meant all their members would become unemployed and even if it was the several hundred union-negotiated wage, benefit, and work rules that factored greatly into Hostess’ demise.

In The San Jose Mercury News, Thomas Sowell provides an example of Hostess’ union collective bargaining woes:

The work rules imposed in union contracts required the company that makes Twinkies, which also makes Wonder Bread, to deliver these two products to stores in separate trucks. Moreover, truck drivers were not allowed to load either of these products into their trucks. And the people who did load Twinkies into trucks were not allowed to load Wonder Bread, and vice versa.

[click to continue…]

The Alaska Policy Forum recently exposed that the state’s legislature in 2011 and 2012 appropriated millions of tax dollars to finance the facilities of a Laborers’ International Union of North America local. As is the case with numerous state government spending initiatives today, it violates the state’s Gift Clause — a constitutional protection in 47 of 50 states that forbids government from allocating tax dollars to private entities for non-public purposes.

The origins of the Gift Clause stem from the legal jurisprudence known as the public purpose doctrine, which is a similar commonsense principle safeguarding the public purse. In the 1874 U.S. Supreme Court ruling Loan Association of Cleveland v. Topeka, which affirmed the public purpose doctrine, declared, “Taxation… can only be used in aid of a public object, it cannot, therefore, be exercised in aid of enterprises strictly private, for the benefit of individuals, though in a remote or collateral way the local public may be benefited.”

Whereas the public purpose doctrines teeth have been defanged by subsequent court decisions, state Gift Clauses are making a comeback of sorts. In previous posts, I have noted the heroic strides taken by the Goldwater Institute for restoring the strength of the Gift Clause in Arizona, and the need for other fiscally troubled states to replicate their efforts to cut state costs by ending government largess to private parties.

The improper appropriations revealed by the Alaska Policy Forum fail to meet the criteria for public spending laid out in the Gift Clause. The details of the union handout:

The 2011 capital budget includes $4,000,000 to help construct a training facility in the Anchorage Bowl for training laborers throughout Alaska. The total project cost is estimated at $14,500,000. The 2012 capital budget includes an additional $2,000,000 to construct a dormitory to house trainees. Construction on the training facility was to have begun in the summer of 2011 and be completed by summer of 2012. Only a master plan and utility realignment have been completed at the new location in the Chugiak Industrial Park. So far, the State has only funded $31,000 for completed work. However, the remainder of the appropriated money is available for future work.

Clearly, the public aid given to the union violates Alaska’s constitution Article IX Section 6, which reads, “No tax shall be levied, or appropriation of public money made, or public property transferred, nor shall the public credit be used, except for a public purpose.”

Gift Clauses exist for a reason. Spending millions of tax dollars solely for the benefit of a union local contradicts the edict set forth by the states constitution. The public spending provides neither an equal value nor service to taxpayers in return for their money. Now Alaskan taxpayers need to uphold their Gift Clause to end the reprehensible abuse of government spending. If not, politicians will continue to use public monies to reward their political allies.

In America, it is impossible to snuff out money from politics. As long as government has the power to dish out favors to politically connected interests, it will continue to attract money, in the form of lobbying and campaign contributions, from those seeking to influence how it doles out its largess.

This November, California voters will have the opportunity to throw a wrench in this vicious cycle by voting for Proposition 32, which would ban corporations and unions from directly contributing to elected officials, bar government contractors from making political donations to state officials who control their contracts, and prohibit automatic deductions of wages from employees for political purposes.

Opponents of Prop 32, comprised largely of labor unions and their allies such as the League of Women Voters, counter in a statement that the measure “does not take money out of politics—because super PACs and independent expenditure committees are exempt from its controls.” Special interests — unions, corporations, and government contractors — would still be able to spend substantial funds on politics, but through indirect means. The bans on direct donations to elected officials simply would change how political spending is done, but would not roll back special interests’ influence on California’s state government.

True enough, but that is not the whole story. Prop 32 adversaries gloss over the voter initiative’s lone stride toward loosening special interest power. The paycheck protection component, which would prohibit automatic payroll deductions of union dues, does take away one government-granted privilege to one special interest group: organized labor.

Currently, California and many other states provide public sector unions with what amounts to a taxpayer-funded dues collection service. Prop 32’s paycheck protection clause would relieve taxpayers and individual union members from being forced to finance organized labor’s political agenda. The seemingly commonsense reform closes the door on an instance where government does hold the power to aid a special interest.

[click to continue…]

This November, voters in Montgomery County, Maryland, will decide whether the police chief or union boss should determine public safety policy.

The voter initiative, which will appear on the ballot as Question B, reads, “Shall the Act to modify the scope of collective bargaining with police employees to permit the exercise of certain management rights without first bargaining the effects of those rights on police employees become law?” A vote in favor of Question B eliminates effects bargaining.

Question B’s origins began in 2011, when the all-Democratic County Council unanimously passed legislation to repeal the union’s power to challenge, then bargain, over basic police chief directives. Before the reform, police department management needed union approval to implement any new policy. Even asking officers to check their email became a contentious ordeal. The union power over management derived from what is called “effects” bargaining, a privilege the local police union does not intend to lose.

To maintain the status quo or preserve effects bargaining for the county’s police, the Fraternal Order of Police (FOP) local gathered more than 40,000 signatures – more than enough to put Question B on the ballot.

[click to continue…]

Big Labor’s Midwest Offensive

by Trey Kovacs on September 28, 2012

in Labor

Yesterday in the St. Paul, Minnesota, Pioneer Press, my colleague Russ Pohl and I detail the current militant tactics used by Midwest public-sector unions that are paralyzing government. The actions reveal the need to uproot the foundation of government union’s power over taxpayer funds by eliminating collective bargaining in government.

We explain that in Chicago the power of collective bargaining enabled the teachers union to execute a seven-day illegal strike:

Illinois state law “prohibits the CTU from striking over non-economic issues, such as layoff and recall policies, teacher evaluations, class sizes and the length of the school day and year.” Yet CTU President Karen Lewis has stated that evaluation standards and layoffs policies are the reason the teachers abandoned their 350,000 students.

Wisconsin public sector union’s collective bargaining advantage affords them absurd legal standing. It enabled the Madison teachers union to file suit and win — for now — against Gov. Scott Walker’s collective bargaining reform. On September 14, Wisconsin Dane County Circuit Judge Juan Colas ruled, ”[I]t is undisputed that there is no constitutional right to collective bargaining.” Yet, he ruled that limiting the conditions over which government unions can negotiate violates workers’ rights to freedom of speech and association. In other words, the Judge essentially decided that if public sector union power were restricted, unions would be less attractive for workers to join, therefore limiting employees’ speech and freedom of association.

In addition, Colas found that the reform law’s provisions freeing workers from forced union dues payments and holding annual union re-certification elections violate the U.S. Constitution’s Equal Protection Clause — essentially arguing that the law is not being equally applied if firefighter and police unions may legally coerce members to pay dues while other government unions may not.

[click to continue…]