Union Watch Highlights

California Lawmakers ready to make another sweet deal for Unions
Editorial, August 14, 2012, Fresno Bee
Sen. Darrell Steinberg, the president pro tem of the California Senate, says he’s still studying Assembly Bill 2451, Speaker John A. Perez’s multimillion-dollar benefit giveaway to powerful police and firefighter unions. Steinberg is late to the issue. The bill, which The Sacramento Bee exposed last week, is the most irresponsible measure of the current session. But it awaits final action on the Senate floor. Despite its high cost, there still are no plans to hold a hearing on this bill in a Senate fiscal committee. Why not? A spokesman for Perez says amendments are being prepared to soften its financial impact. Yet for now, it remains a fiscal train wreck. Lobbyists for cities and counties say there are no changes contemplated that could eliminate the considerable economic hardships this bill places on struggling local governments. The measure, pushed by public safety employee unions, eliminates the 41/2-year statute of limitations on work-related death benefits for peace officers and firefighters who die of diseases presumed by law to be job-related, including cancer and heart attacks. (read article)

Union chips in $2.5 million to fight Proposition 32
By Jon Ortiz, August 14, 2012, Sacramento Bee
Service Employees International Union has put another $2.5 million into defeating Proposition 32 , a November ballot measure that would alter how political campaigns are financed in California. The donation came from SEIU’s California State Council of Service Employees Issues Committee, according to state records filed on Monday, bringing the total contributions to the No on 32 campaign to about $19.5 million. Between contributions from its issues committee and from SEIU Local 1000, the union has now kicked in about $3.5 million to defeat the Nov. 6 ballot proposal. The Yes on 32 campaign has taken in about $4 million so far. The measure would ban unions and corporations from using payroll-deducted funds for political purposes. It also bans direct campaign contributions by either interest group. Both sides could continue funding independent expenditure campaigns. (read article)

Labor Unions Call For ‘Second Bill Of Rights,’ Encourage ‘Politicians Of Both Stripes’ To Sign On
By Cole Stangler, August 14, 2012, Huffington Post
Tens of thousands of labor movement supporters came together in Philadelphia Saturday for a rally meant to demonstrate the movement’s political clout ahead of the party conventions and the presidential election. At the Workers Stand for America rally, organized by the AFL-CIO, unions laid out what they deemed a “Second Bill of Rights” — a set of demands that the nation’s largest labor federation plans to use to try and influence the conversation during the electoral season. The group also said it would try to pressure politicians into supporting its ideas in exchange for endorsements. (read article)

Illinois Labor Unions Call Pension Options Unconstitutional
WJBD Radio, August 14, 2012
Illinois labor unions say the legislature’s idea of changing cost of living benefits to fix the pension systems is unconstitutional. Sean Smoot with the Illinois Police Benevolent and Protective Association says the framework is flawed and morally wrong.  “A framework which places the entire burden of the state’s failures on the retired employees and the people who serve this state daily.  Let me be clear.  The Illinois Constitution specifically states that pension benefits are a contractual right that may not be diminished or impaired”, said Smoot. The President of the Illinois Education Association Cinda Clickna says their members are being expected to bail out the state.  “The pension crisis was caused by past governors and legislators that failed the people of our state.  The members that I represent, the members of our labor group, and the school districts pay their portion, and the state diverted money from what they were suppose to pay to fund other projects”, said Clickna. (read article)

Business interests wary of tangling with labor over California’s Proposition 32
By Jon Ortiz, August 13, 2012, Sacramento Bee
Sacramento boasts a cottage industry of political message massagers, but when a chance to become the spokesman for a controversial initiative on the coming November ballot surfaced last year, none of the local firms stepped up. The group backing Proposition 32, which would fundamentally alter California’s campaign financing, turned to 28-year-old Jake Suski, a GOP operative who has tasted victory and defeat in a relatively brief but wide-ranging political career. “Mostly the latter,” Suski said in a recent telephone interview. But get used to seeing his name. Suski will be chief spokesman for the Yes on Prop. 32 campaign; he’s one of several professionals crafting strategy for a measure that unions view as an attack on their very existence. (read article)

Wolk criticizes Steinberg for cutting off broadcast of hearing
By Dan Walters, August 10, 2012
State Sen. Lois Wolk, who chairs the Senate Governance and Finance Committee, criticized Senate President Pro Tem Darrell Steinberg on Friday for cutting off a cable television broadcast of her committee hearing Wednesday. The hearing — one required by law — was called to present facts and pro and con arguments about four pending ballot measures, Propositions 30, 31, 38 and 39, and as it opened, Wolk said she hoped it would give voters with information to cast informed votes. But just before the hearing began, someone from Steinberg’s office ordered the California Channel, a public affairs channel carried by most California cable systems, to not air the hearing. A Steinberg spokesman said later that it was to prevent advocates and opponents of the measures from using recordings of the hearing in campaign advertising. (read article)

California’s Public Union Referendum
Opinion, August 10, 2012, Wall Street Journal
The voters have a chance to break the union hold on Sacramento. Since voters in San Diego and San Jose overwhelmingly supported ballot measures scaling back worker retirement benefits in June, California Governor Jerry Brown has again picked up the cause of pension reform. Alas, Democrats in the legislature aren’t listening, so it looks like voters will have to use the ballot box to get the job done. Surveys show that pension reform and funding education are among the top taxpayer priorities, but the two are not mutually exclusive. Retirement benefits, which are costing taxpayers more than $6 billion a year, have forced significant cuts to higher education and will soon wallop… (read article – subscription required)

States Exempt Labor Unions from Stalking, Trespassing Laws
By Lachlan Markay, August 10, 2012, Heritage.org
At least four states provide exemptions to anti-stalking laws for labor union officials conducting organizing activities, according to a new report from the U.S. Chamber of Commerce. Every state in America criminalizes stalking, generally defined as repeated unwanted contact with another individual designed to cause some sort of mental or emotional distress. But Illinois, California, Nevada, and Pennsylvania offer broad exemptions for union officials. A law in Illinois, for instance, exempts from stalking prohibitions individuals who are engaging in “any controversy concerning wages, salaries, hours, working conditions or benefits . . . the making or maintaining of collective bargaining agreements, and the terms to be included in those agreements.” Pennsylvania law says that laws against stalking “shall not apply to conduct by a party to a labor dispute.” That could prove troubling for the owners of Philadelphia-based Post Brothers Apartments, who allege that the wife of one of the company’s owners “is routinely followed taking their toddler to pre-school by picketers” involved in a labor dispute. (read article)

Unions ready to send volunteers out for Obama
By Sam Hanenel, August 9, 2012, Miami Herald
Labor unions plan to send out more than 300,000 volunteers later this month to canvass voters to support President Barack Obama’s re-election. The effort begins on Aug. 25, when activists fan out across 27 states during a national “day of action.” AFL-CIO President Richard Trumka says a record 400,000 union-based volunteers will be knocking on doors and talking to voters in all 50 states later this year. For the first time, unions can use their funds to target non-union households as well as those with family members in a union. That change comes as a result of the Supreme Court’s landmark campaign finance decision in Citizens United. Roughly two-thirds of voters in union households backed Obama in 2008. (read article)

This time, California cities win, unions lose
Editorial, August 8, 2012, Orange County Register
Effort stalls in Legislature to delay municipal bankruptcies. Could public-employee union clout have reached its zenith in California, and begun a descent? That may overstate the case. But taxpayers can take solace in a decision this week to shelve, for now, another pro-union bill to protect public workers from municipal bankruptcies. The normally pro-union boss of the state Senate, Sacramento Democrat Darrell Steinberg, put on hold legislation that may have delayed some municipal bankruptcies. Mayors of California’s largest cities opposed the bill. San Bernardino, Stockton and Mammoth Lakes recently have sought bankruptcy protection, and other municipalities suffer similar fiscal pressures. Last year, contentious negotiations led to a union-backed law to require cities seeking bankruptcy to first go through a 60-day mediation process with employees. San Bernardino skirted the requirement by declaring its situation a fiscal emergency. “Assemblyman Bob Wieckowski, D-Fremont, proposed allowing a mediator to stop the clock on a city’s move toward bankruptcy if it is found to be cagey about its finances and to order an audit of the municipality,” the Los Angeles Times reported. “A letter from the mayors of California’s 10 largest cities, objecting to the legislation, asserted that the proposal could keep cities from filing for bankruptcy protection ‘indefinitely,'” There has been pressure from the California Labor Federation, California Professional Firefighters and others to change the rules again to protect unions from losing negotiated gains in bankruptcy proceedings. (read article)

How Public Unions Are Destroying the US, and What Scott Walker is Doing Right
By Charlie Vidal, August 7, 2012, PolicyMic.com
Many Americans are concerned with our nation’s skyrocketing national debt and fret over the possibility of us not being able to pay our bills. But America’s impending fiscal apocalypse looms not on the federal level where our nation, but rather on the state and local levels where public sector employees are owed billions in unfunded pension and health care benefits. A day of reckoning is fast approaching for states such as Illinois and California, whose own public union bosses are beginning to recognize that the present systems are unsustainable. State lawmakers have for years found it easy to promise lavish benefits to unions while sticking future generations of taxpayers and politicians with the full costs. At first glance, it appears as though the unfunded liability is not the fault of public sector unions, but of state legislatures. Much of the underfunding is because states have not made their required contributions on a yearly basis, opting to make the promises but not pay for them. (read article)

State Pension Funds Spend $8 billion on Wall Street Fees in 2011
By Maryland Tax Education Foundation, August 3, 2012, Sacramento Bee
The Ultimate Irony: Public Employee Unions Are Indirectly Some of Wall Street’s Biggest Customers: $8 billion in Fees Support Thousands of Wall Street Bonuses; Evidence Shows Wall Street Managers Can’t Beat Market Averages, so the $8 Billion in Fees are Going to Waste; Indexing Portfolios Could Save $$ and Provide Average Results; Indexing Could Cut States’ Unfunded Liabilities by $100 Billion; Pension Funds Support Public Union Employees’ Retirement. Fifty state pension funds recorded over $2 trillion in assets in 2011, with the preponderance of assets being publicly traded stocks and bonds. They spent $7.8 billion on Wall Street money management fees, despite substantial evidence that Wall Street managers are unable to beat passive equity index funds that cost much less. The pension funds represent some of Wall Street’s largest customers. During calendar 2011, 84% of actively managed US equity funds underperformed their benchmarks, according to S&P Indices, a division of McGraw Hill.  Morningstar, the leading mutual fund rating firm, reported similar results for its equity fund universe for 2011. Such underperformance is a consistent problem over time, according to both companies. (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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