- - Monday, September 8, 2014

Seventh in a series

New York-An overwhelming majority of Americans favors abolishing public sector unions because we recognize these organizations are now a cancerous tumor that threatens to choke off and destroy the once vibrant heart of this nation — our beleaguered private sector.

Beset by competition from lower-priced human workers in foreign countries, and threatened with replacement by ever more adept machines, private sector workers cannot afford the luxury of gargantuan, high-cost, public sector bureaucracies that succeed only in piling up operating deficits and debts.

Irresistible downward pressures upon private labor incomes

Even following massive expansion of the public sector (especially transfer payments) under President Obama, private labor incomes remain the single largest generator of tax revenues for America’s numerous governments — measured in inflation-adjusted terms, these incomes have fallen since 1999 and will not rise much in future.

Downward pressures upon incomes inside America and other developed nations is a lasting consequence of opening global markets and the continuing advances in technology that make it so easy outside the protected public sector to replace expensive human labor with less expensive labor and machines.

According to estimates prepared by the United Nations, the global labor force numbered 2.8 billion persons in 1999 and 3.4 billion in 2013 (calculated adding full-time and part-time workers together, and not adjusting to full-time equivalents).

From 1999 onward, a staggering number of workers in rising nations stood ready to compete against the much smaller group of high-cost workers in the developed world.

Between 1999 and 2013, non-agricultural employment outside the developed world rose by 48 percent from 1.1 billion to 1.6 billion. In contrast, inside the developed world, non-agricultural employment rose by only 12 percent from 450 million to 502 million, mirroring experience inside America where employment rose from 142 million to 159 million.

If you believe U.N. estimates — in this case, you might regard them as a best case — growth in non-agricultural employment in the developed world will lag growth elsewhere, increasing by 3 percent through 2020 compared to 16 percent cumulatively in rising nations.

Outside America’s protected public sector, private sector workers, considered as a group, will continue to experience constrained growth, or even declines in income for the foreseeable future.

Stubborn facts concerning America’s public sector unions

Despite evident economic reality throughout the world, Barack Obama proclaimed this past Labor Day that he would join a labor union in 2014, if he could, because he still believes that unions protect high-income jobs inside America. As expected, Joe Biden and other economic illiterates mouthed from similar scripts.

The Obama administration has operated in a fact-free zone to the detriment of most Americans for far too long. In the United States, union membership in the private sector has long been on a steep decline curve, as the Pew Research Center reported earlier this year.

The only sector of the American economy where unions retain a stubborn hold is in government at local, state, regional, and federal levels.

Why do government workers need unions to protect them from supposedly rapacious employers? These ruthless, evil people are none other than you, your neighbors and your friends who struggle against great odds to eke out existence in the private sector.

Unlike public sector employees, we in the private sector do not have pensions, work rules that insulate us from the rigors of global competition, or the right to collect a government check while we also moonlight elsewhere.

Are public sector workers compensated unfairly?

Data available online from the U.S. Commerce Department Bureau of Economic Analysis suggest otherwise.

From 1948 through 1961, the year before President Kennedy signed Executive Order 10988, facilitating organization of public sector unions, the average non-military government worker earned total compensation that was only 9 percent higher than the average private sector worker. (Read “How Government Unions Became So Powerful” here.)

From 1962 through 1981, a period when the American economy expanded and then contracted, the premium earned by the average non-military government worker was only 13 percent more than the average private sector worker.

During the Reagan/Bush/Clinton boom years, the premium started to widen — from 11 percent in 1982, the premium jumped to 22 percent by 1999.

From 2000 forward, as private sector compensation and employment levels suffered under mounting pressures, the premium earned by public sector workers widened to 30 percent, while public sector employment levels suffered less erosion than in private sector.

To bring down the cost of government and increase its effectiveness, the American electorate must abolish public sector unions, starting at the ballot box.

In November 2014 and then in November 2016, readers and engaged voters should push elected officials to do our bidding and remove the intolerable, outmoded oppression of public sector unions everywhere we can.

Next: A bold military footprint

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