Union Watch Highlights

California unions oppose even modest pension reforms
Editorial, November 7, 2011, Wall Street Journal
Philosopher-Governor Jerry Brown finally unveiled a pension reform plan in late October, and it looks like he based it on his self-coined canoe school of politics. According to the theory, paddling a little to the right and then a little to the left will chart a successful course up the middle. Alas, the prevailing winds in Sacramento blow reforms to the left, if they don’t blow them up altogether. California has a roughly $500 billion unfunded pension liability, thanks largely to the legislature’s generous payouts to public unions. Last year pensions cost the state about $5 billion, and the annual… (read article – subscription required)

Government Unions Strike Back in Ohio
By Fred Barnes, November 5, 2011, Wall Street Journal
Ohio Gov. John Kasich likened himself last week to Bernie Kosar, the Cleveland Browns quarterback from 1985 to 1992. Mr. Kasich was campaigning across Ohio for approval of Issue 2, the troubled referendum that would sharply curtail the power of public-sector unions. Asked if his frenetic tour might trigger an upset, the governor responded impetuously: “We never thought Bernie Kosar would bring the Browns back and win that big championship game.” But as Joe Vardon and Jim Seigel of the Columbus Dispatch reminded readers, Mr. Kosar “never won a championship game with the Browns, going 0-3 in AFC title tilt…(read article – subscription required)

Glendora employee group agrees to concessions
By Juliette Funes, November 04, 2011, San Gabriel Valley Tribune
After fiercely debating contract conditions that were imposed on them last year by the City Council, Glendora’s largest employee union recently agreed to several concessions laid out on the bargaining table. The Glendora City Council last week unanimously voted to approve a memorandum of understanding between the city and the Glendora Municipal Employees Association for conditions over two years that include mandated furloughs and a reduction in vacation accrual. Employees will be required to continue picking up 100 percent of their CalPERS share, an issue that drew fire from several employee groups last year. (read article)

Unions take tax-hike campaign to California college campuses
By Laurel Rosenhall, November 4, 2011, Sacramento Bee
The wave of anger at banks that has swept the country with the recent “Occupy” movement is coming to California college campuses next week. A union-backed group calling itself “Refund California” is organizing protests on Wednesday at more than a dozen college campuses, including Sacramento State and UC Davis. The group argues that banks created the country’s economic collapse that decimated state budgets and led to massive tuition hikes in recent years. It is calling on leaders of the public universities to pledge support for higher taxes on corporations and wealthy individuals as a way to restore funding for jobs and education. The group sent letters today to University of California regents and trustees of the California State University, asking them to sign the following pledge… (read article)

Unions want San Diego’s mayor to negotiate pension initiative
By Craig Gustafson, November 4, 2011, San Diego Union-Tribune
With the proposed “Comprehensive Pension Reform” initiative looming on the horizon, the city’s largest labor union has repeatedly demanded that Mayor Jerry Sanders come to the bargaining table and negotiate over the significant changes the measure would impose on workers. The city’s response: You had your chance. The initiative — which would end guaranteed pensions for most city workers in favor of a 401(k)-style plan — has yet to officially qualify for the June 2012 ballot. Labor has been attacking it from all angles in hopes of derailing the proposal before it gains voter approval and goes into effect. (read article)

Emotional flier from Modesto police union targets pension reform measures
By Ken Carlson, Nov. 03, 2011, The Modesto Bee
The costs of public service pensions are a burden for taxpayers in California, and a personal issue for employees who rely on those benefits. A political flier mailed last month injected raw emotion into the debate raging over three pension advisory measures in Modesto. The flier displays a letter from the family of Modesto police Sgt. Steve May, who was critically injured in a vehicle pursuit in 2002 and died in July 2009 after being in a coma since the crash. The letter, signed by his widow, Diana May, and daughter and son, Corinne and Michael, thanks the people of Modesto for supporting the family during the hospital care for Steve May and after his death. But the flier suggests that the family would have been without support if Measure Q had been in force. The measure seeks voter opinion on moving city employees from traditional pensions to the 401(k)-style plans common in the private sector. (read article)

Brown’s pension reform proposal probably the best deal unions can hope for
Editorial, November 3, 2011, San Jose Mercury News
We’ve now seen Gov. Jerry Brown’s 12-point proposal for pension reform, as well as details of two potential ballot measures that would rein in public workers’ retirement benefits. The parameters of the coming debate are clear. The question is whether public employee unions and their allies in the Legislature will see the writing on the wall and embrace Brown’s plan, which includes meaningful changes to the system but doesn’t go as far as the ballot measures. The breadth of Brown’s reform plan pleased even some of his critics, who have said the Democratic governor is too beholden to labor unions. It’s clear he is not. The Wall Street Journal called the plan Brown’s “Nixon to China” moment. The state Chamber of Commerce called it “aggressive and comprehensive.” (read article)

Gov. Brown’s Labor Allies Bash His Pension Reform Plan for California’s Public Employees
By Jerry Roberts, November 3, 2011, Santa Barbara Independent
Jerry Brown has rolled out his long-awaited proposal to reform publicly financed pensions for government workers, drawing protests from Republicans and Democrats alike. Which means he must be doing something right. “We’re not on a sustainable path,” the governor said last week, unveiling a 12-point plan to address the multiple billion-dollar obligations for which taxpayers are on the hook in funding the retirements of state and local public employees. At a time when Sacramento, cities, and counties all face big deficits and huge debts, the pension issue has emerged as the most visible symbol of the public’s dismay about government spending. (read article)

Collective Bargaining Like It’s 1978: Proposed California Initiative Aims at Public Employee Unions
Editorial, November 3, 2011, Orange County Register
One of the biggest mistakes in California history was passage of the Dills Act in 1978. It was quickly signed into law by Jerry Brown during his first stint as governor. The Dills Act mandated that the state must negotiate collective-bargaining contracts with public-employee unions. This quickly turned the unions into the most powerful force in the state. The result was major increases in the pay and benefits for public-sector workers. According to a March 2011 study by the Heritage Foundation, “the total public-sector pay premium in California may be as high as 30 percent” above the private sector, which, of course, pays for everything through high taxation. Worst was the “pension spiking” that began in 1999. The powerful unions pushed through the Legislature Senate Bill 400, which awarded “3 percent at 50” pension payouts for public-safety workers, a 50 percent increase. That meant, after 30 years on the job, an employee could retire as soon as age 50 with 90 percent pay. (read article)

California Unions Must Pitch in to Help Control Expenses: View
Editorial, November 01, 2011, Businessweek
California state politics are often said to be as dysfunctional as Washington’s. We’ll soon see if the Golden State can rise above such defamation. Governor Jerry Brown proposed sweeping changes to state pensions last week in an effort to pull California out of a fiscal tailspin. If he can muster the political support necessary to wring concessions from the state’s public unions, California could reclaim its stature as a model, rather than a warning, to other states. As Bloomberg News has reported, some California city managers earn more than the governor. Prison guards who take an annual physical exam collect a monthly fitness bonus of $130 — even if they don’t pass. Pay for firefighters in Los Angeles is twice the national average. One state prison nurse was paid $269,810, tripling her base pay with overtime. (read article)

California Ballot Measure Would Eliminate Collective Bargaining Rights for Public Employee Unions
By Will Bigham, November 1, 2011, San Bernardino County Sun
Petitions are being circulated for a ballot measure designed to end collective bargaining for California’s public- employee unions. The End Public Sector Bargaining Act would eliminate collective-bargaining rights for public employees such as teachers, nurses, police officers and firefighters. It is similar to a Wisconsin law passed this year. The measure would apply not only to state employees, but to employees at local government agencies such as counties, cities and school districts. The measure’s sponsor, a UC Santa Barbara economics lecturer, must gather more than 800,000 signatures by Feb. 3 for the measure to qualify for the the Nov. 6, 2012, presidential ballot. Jack Pitney, a political-science professor at Claremont McKenna College, called the measure “dead on arrival” because of the state’s left-leaning politics and strong union presence. “I’d be surprised if he can even get it qualified,” Pitney said. “I doubt he can get enough signatures.” The measure’s sponsor, Lanny Ebenstein of Santa Barbara, could not be reached for comment. Ebenstein is a former board member at Santa Barbara Unified School District and an author who has written biographies of free-market economists Friedrich Hayek and Milton Friedman. (read article)

Public Sector Pensions Investing in Hedge Funds
Editorial, October 31, 2011, UnionWatch
In less than five years California will have over 10 million residents who are over the age of 55 (ref. U.S. Census, California Demographics). If every one of these people were to receive a pension equivalent to what the average public employee in California can now expect after working full-time for no more than 30 years, it would cost taxpayers nearly $700 billion per year. To put this in perspective, $700 billion is 40% of California’s entire gross domestic product. When spokespersons for California’s public sector unions claim that pension reformers are “trying to destroy the middle class,” they should be asked this question: How on earth can any system of retirement security – not even including health insurance benefits – possibly expect to consume 40% of the entire economic output of the state or nation in which such benefits are being provided, and yet remain financially sustainable? (read article)

About the author: Jack Dean is editor of PensionTsunami.org, formed to monitor developments in all three pension spheres nationwide — public employees, corporations and social security. PensionTsunami, like UnionWatch, is a project of the California Public Policy Center. Dean is a former newspaper editor and a past executive director of the Reason Foundation. He has been active in politics for more than three decades and currently serves as president of the Fullerton Association of Concerned Taxpayers.

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