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Labor Unions, Collective Bargaining, and Taxpayers

In a new Tax & Budget Bulletin (requires Adobe), Chris Edwards. Director of Tax Policy Studies at the Cato Institute writes about the growth of public-sector labor unions. He begins by saying:

“Labor unions play a diminishing role in the private sector, but they still claim a large share of the public-sector workforce. Public-sector unions are important to examine because they have a major influence on government policies through their vigorous lobbying efforts. They are particularly influential in states that allow monopoly unionization through collective bargaining.

“Collective bargaining is a misguided labor policy because it violates civil liberties and gives unions excessive power to block needed reforms. To provide policymakers with greater flexibility and to improve government efficiency, states should follow the lead of Virginia and ban collective bargaining in the public sector.”

The union member share of employment in the private sector has grown from over 30% in 1965 to under 10% today. On the other hand, the share of union employment in the public-sector has hovered just below 40% for most years since 1985. The share of public employment in state and local government ranges from a high of 71% in New York and Rhode Island to a low of 8% in North Carolina. In Virginia, it’s 11%.

Edwards concludes this very informative bulletin by saying:

“To put citizens and taxpayers back in control of their governments, collective bargaining and forced union dues should be outlawed in the public sector. Public employees should be free to join worker associations, but they should not be given a special legal status and handed extra power to block desperately needed fiscal reforms. “

Wise advice indeed!

UPDATE (4/5/10): Chris Edwards blogs at Cato@Liberty today providing additional evidence, which shows  that "as the union share (in state/local government) increases, a state tends to have a higher government debt load." He then adds, "The correlation is likely caused by the fact that unionized government workers are powerful lobby groups that push for higher government-worker compensation and higher government spending in general."

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