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Asked Twice, Gov. Daniels Can’t Explain How Eliminating Collective Bargaining Reduces Deficits

Several Republican governors — most notably Gov. Scott Walker (R-WI) — are trying to legislatively strip public employees of their right to collectively bargain, under the guise of a budget crisis. These governors are using the economic anxiety being felt across the nation as a justification for eliminating the ability of workers to bargain, even though such rights have no bearing on a state’s fiscal soundness.

Gov. Mitch Daniels (R-IN) already stripped public employees of their right to collectively bargain in 2005. But even having personally implemented such a policy, Daniels can’t explain how it would help Wisconsin get its budget into balance. In fact, Daniels admitted to NPR’s Diane Rehm yesterday that removing collective bargaining rights from public employees is all about kneecapping unions politically:

REHM: Help me to understand how taking away the rights of collective bargaining would fix or help to fix the budget shortfall.

DANIELS: Well, the most powerful special interest in America today are the government unions. They’re the leading financial contributors. They have the biggest PAC’s. They have muscle. A lot of times their contracts provide for time off to go politic and lobby. And over the course of the last few decades, if there were ever injustices or shortfalls in how we took care of government employees, it has been fixed and over-fixed. And so I think that the — you know, he’s trying — what he’s trying to do is, in the public interest, interrupt this fortuitous process in which taxpayer dollars pay for very solid salaries for government employees. [...]

REHM: I still am totally in the dark as to how bargaining and the bargaining power of unions and taking that away is going to affect the budget process.

DANIELS: Well, if my newspaper is correct, he is not talking about that. He’s talking about narrowing the scope down to wages and, you know, that…

REHM: But they’ve already conceded wages.

DANIELS: Well, you know, this is — I think he’s trying to fix a structural problem, which I’ve demonstrated or discussed to you already, Diane. The problem comes from the, you know, forced expropriation, whether they like it or not, of money from — that started with the taxpayers, from the salaries of government workers, circulated back into a political machine that is the most powerful out there.

Daniels can’t give a reason for how eliminating collective bargaining would reduce state deficits because there isn’t one. In fact, “states with no collective bargaining rights for any public employees saw an average budget shortfall of 24.8 percent in 2010 while states (including the District of Columbia) with collective bargaining for all public employees had an average budget shortfall of 24.1 percent.”

Daniels is dealing with protests in his own state that mirror those occurring in Wisconsin. In fact, Indiana Democratic lawmakers left the state today — denying the state legislature a quorum — in order to block a bill that would make Indiana a “right to work” state, which would allow non-union members to free-ride on union contracts. Central Indiana Jobs with Justice called the bill “an attack on the middle class.”

Update

Daniels today said that Republican legislators should drop their anti-union bill, echoing previous statements that he believes this is not the year for such legislation to be considered.

Gov. Kasich Uses Deficit To Justify Assault On Workers, While Still Insisting On Budget-Busting Tax Cuts

Public workers in Ohio will be descending upon the Ohio statehouse today to protest Senate Bill 5, a legislative effort to strip state employees of their collective bargaining rights. The bill is similar to one proposed in Wisconsin that set off days of protest there.

Wisconsin’s Republican leadership is trying to use the state’s budget woes as a justification for its assault on workers’ rights, even though stripping workers of the ability to collectively bargain won’t fix the state’s fiscal position (which has been made substantially worse by Gov. Scott Walker’s (R-WI) insistence on a slew of tax cuts). And Gov. John Kasich (R-OH) last night broke out the same script on Fox News:

You know, to understand what we face out here, we’re $8 billion in the hole. And we are not a competitive state. We’ve lost 600,000 jobs in the last 10 years, and only California and Michigan have done worse. And our young people leave after three years, a third of our college graduates. What I’m doing is I’m going to cut taxes, preserve the tax cut we have, and I’m going to balance this budget and I’m going to restructure the state. And collective bargaining is just one piece of an overall reform program designed to make us competitive again…I mean, we’re $8 billion in the hole. If you were $8 billion in the hole and you realized there are things that you can do to control your costs or to give other people the means to control their costs, wouldn’t you do it? And that’s exactly what this bill is.

Watch it:

Kasich is indeed facing an $8 billion budget hole, but its unclear what stripping workers of their collective bargaining rights would do to fix that situation. As Policy Matters Ohio found, states that deny public workers the right to collectively bargain are in no better fiscal shape (and, in many cases, are worse off) than states that do allow workers to bargain collectively. “Ohio’s budget problem is a revenue crisis, caused by a weak economy and ill-advised tax reductions that have deprived the state of needed revenue. Eliminating collective bargaining is not going to solve a revenue crisis,” explained Policy Matters Ohio Executive Director Amy Hanauer.

Plus, Kasich, shortly after bemoaning his state’s budget situation, insisted that he will implement a slew of budget-busting tax cuts that he’s proposed. These cuts will double the state’s deficit — by eliminating the state’s estate tax and income tax — while likely not leading to any noticeable job growth. Kasich has even proposed privatizing some of the state’s assets in order to finance new tax cuts for corporations and the rich, as Kevin Donohoe pointed out.

Republicans across the country are using the understandable anxiety of difficult economic times to push forward proposals kneecapping their ideological foes: public employees and the unions that represent them. But if Kasich were serious about addressing his budget, he’d rethink implementing policies that will make the problem significantly worse, instead of launching a political assault that has nothing to do with the problem at hand.

Wisconsin Lt. Governor: Stripping Workers’ Rights Is The ‘Responsible’ Way To ‘Balance This Budget’

Protesting public workers in Wisconsin plan to continue demonstrating this week against Gov. Scott Walker’s (R-WI) plan to strip them of their collective bargaining rights, as the state’s Republican lawmakers said that they will move forward with their agenda in the absence of state Democrats (who have set up shop in Illinois, to deny the state Senate a quorum). Walker has thus far refused multiple compromises offered by both the workers themselves and a member of his own party, insisting that any deal include an elimination of collective bargaining rights for public employees.

Walker’s stated reason for wanting to eliminate collective bargaining for state employees is Wisconsin’s economic woes. Last night, Lt. Gov. Rebecca Kleefisch (R-WI) appeared on Fox News to claim that Walker’s union-busting approach is necessary because “we’re broke.” “Our governor, Scott Walker, has chosen to do the responsible thing and tell the truth to the taxpayers of the state of Wisconsin, and balance this budget in a sound way,” she said:

We just can’t afford it. We’re not joking when we say that we’re broke. We don’t have any money to negotiate with. [...] Wisconsin is proud to be a leader here. I think Gov. Scott Walker has done a tremendous job blaxing a trail when it comes to frugality and moderation as we approach a fiscal crisis. Because we know that Wisconsin is certainly not the only state facing this kind of deep budget crisis.

We have a $3.6 billion, with a b, deficit coming up in our next biennium. Right now, you know that for our budget repair bill we’re facing a $137 million hole. That’s what we need to fix, and that’s what states around the nation are looking to fix. Some are choosing to fix it by raising taxes. We know that our hard-working families in Wisconsin can’t afford that in the middle of the deepest economic recession in generations, and so our governor, Scott Walker, has chosen to do the responsible thing and tell the truth to the taxpayers of the state of Wisconsin, and balance this budget in a sound way.

Watch it:

Playing up budget woes during a time of high economic anxiety may make political sense, but the numbers don’t support Kleefisch and Walker’s claims. While Kleefisch cites a $3.6 billion deficit in the next state budget period as a justification for attacking workers’ rights, it was Walker who pushed through a package of tax cuts that have significantly worsened the state’s fiscal standing in that very timeframe. “Walker was not forced into a budget repair bill by circumstances beyond [his] control,” said Jack Norman, research director at the Institute for Wisconsin Future. “He wanted a budget repair bill and forced it by pushing through tax cuts.”

Even if Walker hadn’t personally made the fiscal situation in his state much worse, stripping workers of collective bargaining rights won’t actually make it any better, saving taxpayers “almost nothing.” As John Sides pointed out, states with higher rates of unionization do not have higher budget deficits, while Wisconsin public employees already make substantially less money than their private sector counterparts. Wisconsin workers have already agreed to concessions on pay and benefits, so long as they retain their collective bargaining rights.

All in all, Walker and Kleefisch are using the guise of a budget crisis to push forward an ideological assault on unions and workers. Walker may want to remember that the last time he went union-busting in this manner, when he was Milwaukee County Executive in 2009, it ended up costing taxpayers hundreds of thousands of dollars.

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