States going bankrupt, union members declining – when will they ever learn?
Since the 1970s, union membership has been steadily declining in the private sector to about 7.6% of the workforce, while unions have grown in the public sector to 36.8%. As a result, the public entities at all levels are going bankrupt because of a quid pro quo exchange of – votes for jobs, with lavish pensions and health care.
One of the reasons for the decline in the private unions is that unions have priced themselves out of the international market. The loss of industrial manufacturing jobs is directly proportional to expensive union contracts and health benefits, that corporations could no longer afford trying to compete in a global market.
Americans also bought the cheaper goods, regardless of their quality, being more concerned with the upfront costs, rather than looking at the total cost of ownership. So, unless legislation mandating that everyone buy only American products, or raising tariffs so high, that people can’t afford to buy the foreign products, capitalism still allows the consumer the freedom to choose for themselves.
With public unions, however, consumers have little choice. Cities can’t declare bankruptcy and close up shop like private entities. The states, in turn promised pensions they couldn’t possibly pay for and then underfunded the plans. These expenditures are forcing the states to borrow more and more with taxpayers footing the bill - a retroactive 67% increase in income taxes in Illinois.
According to the Board of Labor Statistics (BLS), half of the 15.3M union members live in just six states: California, Illinois, New York, Pennsylvania, Michigan and New Jersy. Currently, 22 states have right-to-work laws and Republican governor, John Kasich of Ohio is moving to ban strikes by public school teachers. Powerful unions and high taxes have been a job-killing proposition for the blue states.
In the last 25 years, job growth in right-to-work states have been over twice as high as union-right states, according to the Manhattan Institute senior fellow, and former chief economist at the U.S. Department of Labor, Diana Furchtgott-Roth.
In the last 20 years, according to the BLS statistics, New York has seen a net job increase of only 2.9%; California only 11.3%. In the last decade California has lost 365,000 jobs! In contrast to that are Florida and Texas. Since 1990, Florida has seen a 34.5% increase in jobs, and Texas an increase of 49%.
Now the state of Illinois wants to tax internet sales, see today’s guest column in the Rockford Register Star. Remember, the Gross Receipt’s Tax is still probably waiting in the wings in this anti-business state, and the Illinois legislature still hasn’t met a tax or fee they didn’t like.
The lyrics, “When will they ever learn,” seems very fitting for the ongoing war against free enterprise by our own governments, both state and federal.