Mrs. Thatcher, Mr. Obama and Unions

Excess in government is like putting a large stone around the collective neck of citizens and then tossing them into the ocean to sink or swim. No one would do such a thing to a person, so why are most governments determined, as a matter of policy, to do it to their citizens collectively?

Thomas Jefferson said: "A wise and frugal government, which shall restrain men from injuring one another, which shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government." Yet we see today in the United States a series of events at the state-government level that defies Jefferson’s precept.

Ohio, Illinois and Wisconsin are trying to reduce their budget deficits, which the governors of these states say is closely tied to the cost of maintaining unionized public employees. The governors want to reduce the bargaining rights of these public employee unions and make their members pay a slightly larger percentage of their health and retirement costs. The battle over these attempts is something akin to a wild west movie with state senators hiding out in neighboring states to avoid voting on the governor’s proposal and unionized public employees camping out in state capitol buildings.

An American tenet, which employees fought hard to gain, is that they have the right to bargain with their employers for wages and benefits. This system has worked well in the private sector, where both sides are relatively equal and can bargain in good faith, as the law requires.

The problem with public employee unions is that both sides are not equal. Teachers and police and fire fighters hold the citizens of an entire state hostage while they demand more and more benefits and higher wages. This may succeed when the state government has sufficient revenue from the taxation of its citizens to pay for such demands. But today, when states have tax deficits and cannot possibly cover such public employee union demands, the equation changes.

States are required by law to balance their budgets. They can borrow, but only as long as they can pay the costs of the debt. And, when a state is held hostage to what amounts to outlawry by public employees and their unions, who know full well that there are no funds to cover their demands, one must ask why citizens who are themselves earning less (thus, the lower tax revenue flow) should continue to support a public employee lifestyle that denies reality and laughs in the faces of the citizens who pay them.      

Margaret Thatcher understood the dilemma. She took on the unions and won because she refused to be blackmailed by their threats to shut down Great Britain. She won because she was right. Governments cannot pay out more than they take in.

President Obama ought to be taking the lesson from these courageous governors. He should stop posturing about the right of employees to bargain collectively and suggesting that Republican governors who are trying to make some small order out of the mess created largely in Washington by the President and his Democratic congress are union busters.

Reducing the federal budget is the only way forward, Mr. Obama. Instead of slamming those who are trying to do this, you ought to join them. Now.