Solis Leads Cheers for Wisconsin Public Employee Unions

bigstockphoto_hilda_solis_at_obama_town_hall_5020448Secretary of Labor Hilda Solis has taken her gloves off in the ongoing war within the states. And her supporters are aching for more. In a speech before a partisan audience at the Marriott Wardman Park Hotel in Washington, D.C. last Saturday, Solis proclaimed solidarity with Wisconsin public-sector unions and their supporters who have all but shut down the state legislature in protest of Republican Gov. Scott Walker’s proposals to curb public spending. Speaking before the closing session of the Democratic National Committee winter meeting, she urged her troops: “The fight is on. We work together. We help those embattled states right now where public employees are under assault.” Such comments won her standing ovations. But they also underscored the extent to which the current administration views “labor” and “organized labor” as interchangeable.

National Legal and Policy Center took detailed note of Ms. Solis’ background in December 2008, shortly after President-Elect Barack Obama had nominated her as Labor Secretary. The facts suggested, at least from a political standpoint, that she was ideally suited for the post. A four-term California Democratic congresswoman from East Los Angeles, Solis was raised in a union home – her father was a Teamster and her mother was a Steelworker. When she first ran for Congress in 2000, she relied heavily on union financial support, and once elected (and re-elected), justified that support by joining the House Progressive Caucus and amassing a 100 percent lifetime score from Americans for Democratic Action. She continued to be a mass immigration booster, having back in the mid-Nineties expressed the view (officially supported by organized labor since 2000) that illegal resident status ought to be no impediment toward becoming an American. Related to this, she served as a member of candidate Obama’s National Latino Advisory Council in 2008. Predictably, Solis’s nomination as DOL secretary won plaudits from AFL-CIO President John Sweeney, Service Employees International Union (SEIU) President Andrew Stern and other labor leaders.

Solis wasted little time justifying her supporters’ hopes. During the first few months in 2009, she rolled back expanded financial reporting requirements for Forms LM-2 and LM-30, drawn up and finalized during the Bush administration. These requirements came about because her immediate predecessor, Elaine Chao, saw a real need to combat widespread union corruption. With the help of another radical Obama appointment, Solicitor Trisha Smith, Solis also created a program to hire union members and allied volunteers to monitor potential private-sector wage and hour violations. And she’s launched a new DOL program, We Can Help, that seeks to stop private-sector workplace exploitation, but which, as Solis herself has hastened to announce, covers all workers regardless of immigration status.

Solis’ remarks before the Democratic National Committee proved just the tonic for attendees. Unionized public-sector workers in Wisconsin, she remarked, have had their backs to the wall because of Governor Walker’s plans to restrict most public employees’ collective bargaining rights and raise their mandatory contributions to pension and health plans. She elaborated:

We know many states are facing tough budget decisions. We know there’s room for shared sacrifice…We’ve seen our brothers and sisters in public employee unions willingly give up their fair share…The governors of Wisconsin and Ohio aren’t just demanding that they tighten their belts, they’re demanding that they give up their uniquely American rights as workers.

“Admittedly, I am a little biased,” she told the audience. “I come from a union household.”

While her candor was encouraging, she ignores the reality that these “tough budget decisions” have come about largely because of costly and unsustainable union-negotiated contracts which have been both a cause and effect of sharp growth in public-sector employment. Let us leave aside the fact that federal employees, including those in the Department of Labor, do not have collective bargaining rights with respect to wages and salaries. Consider instead that state and local government employees in 2010 on average received a total compensation of $39.60 an hour, compared to the private-sector full-time employee equivalent of $27.42 an hour; benefits were nearly 70 percent higher. And unionized public employees in 2010 totaled 7.6 million, well surpassing the 7.1 union members in the private sector (each figure down by 300,000 from 2009). That didn’t stop labor officials in the audience from seconding Secretary Solis’s call for solidarity. AFSCME President Gerald McEntee and former SEIU Secretary-Treasurer Anna Burger each spoke in favor of a resolution supporting collective bargaining for public-sector employees in Wisconsin and elsewhere.

But Secretary Solis isn’t just downplaying the role of unions in driving states to financial crisis. She also is acting contrarily to her department’s mission, which is “to foster, promote, and develop the welfare of the wage earners of the United States, to improve their working conditions, and to advance their opportunities for profitable employment.” Improving the welfare of America’s working population is a noble enterprise. But that enterprise shouldn’t be equated with promoting union power. Unions function as cartels. They seek to monopolize the supply of labor in a given firm or industry, so as to restrict entry and drive up the cost of hiring members. A union will do right by workers insofar as workers do right by it, beginning with contributing dues payments. To the extent unions exhibit a concern for the general welfare, that concern is circumscribed by an assumption that unions are good for the nation. Group self-interest here operates under an aura of patriotism and a concern for “working families.” Granted, unions, like employers, have a right to pursue their interests. But it’s not the job of unions, any more than employers, to enlist the Labor Department as a de facto partner – or, conversely, for the department to oblige them. As former Labor Secretary Elaine Chao notes: “The Labor Department should not represent only that part of the work force that is unionized. It should be responsible for the overall welfare of the entire American work force.”

Support for this view came this week from an unexpected source in Washington Post economic and domestic policy columnist Ezra Klein. In yesterday’s edition, Klein argued that unions, particularly teacher unions, habitually have placed their own interests over those of the larger public. While sympathetic to the Wisconsin demonstrators, he wrote:

As a chilling report from the New Teacher Project explains, about 40 percent of the nation’s teachers work in states where their contracts don’t allow administrators to take performance into account when making layoffs. That is to say, they cannot try to lay off the bad teachers while saving the good ones. Instead, they’re forced to use the “last-hired, first-fired” mechanism. The newest teachers get the pink slip, not matter how good they are. This will turn a crisis into a catastrophe. And let’s be clear, it’s the fault of the teachers unions…
If unions are to not just survive, but to actually flourish again, they need to create an identity beyond being a protection service for people who aren’t very good at their jobs.

Public-sector unions have become behemoths by playing upon politicians’ innate fears of voter reprisal in the event of a service shutdown or slowdown. That has put them in a position to negotiate wage and (especially) benefit packages so outsized as to pose a threat to the long-term fiscal stability of states where they enjoy bargaining rights – only about half of all states allow unions to bargain on behalf of most public employees. Budget-conscious governors such as Scott Walker (Wisconsin), Chris Christie (New Jersey) and John Kasich (Ohio) are trying to limit the ability of unions to place taxpayers in harm’s way. They understand what’s at stake. By contrast, Labor Secretary Hilda Solis and her supporters don’t.


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