It is worth remembering that Illinois has become the belly of the beast when it comes to pleasing the union bosses at expense of the taxpayer.  Even after raising taxes at the demand of union activists, the state is still suffering through an economic crisis.  This is the point that Wisconsin Gov. Scott Walker has been making — we can’t balance state budgets without reforming the power of the union bosses.  The Wall Street Journal notices the difference between Illinois and Wisconsin in a recent Op-Ed:

Run up spending and debt, raise taxes in the naming of balancing the budget, but then watch as deficits rise and your credit-rating falls anyway. That’s been the sad pattern in Europe, and now it’s hitting that mecca of tax-and-spend government known as Illinois.

Though too few noticed, this month Moody’s downgraded Illinois state debt to A2 from A1, the lowest among the 50 states. This wasn’t supposed to happen. Only a year ago, Governor Pat Quinn and his fellow Democrats raised individual income taxes by 67% and the corporate tax rate by 46%. They did it to raise $7 billion in revenue, as the Governor put it, to “get Illinois back on fiscal sound footing” and improve the state’s credit rating.

It’s worth contrasting this grim picture with that of Wisconsin north of the border. Last winter Madison was occupied by thousands of union protesters trying to bully legislators to defeat Republican Governor Scott Walker’s plan. The reforms passed anyway.

In contrast to the Illinois downgrade, Moody’s has praised Mr. Walker’s budget as “credit positive for Wisconsin,” adding that the money-saving reforms bring “the state’s finances closer to a structural budgetary balance.” As a result, Wisconsin jumped in Chief Executive magazine’s 2011 ranking of each state’s business climate—moving to 17th from 41st. Illinois dropped to 48th from 45th as ranked by the nation’s top CEOs.

Yet Mr. Walker, who balanced the budget without new taxes, is the governor facing a union-financed attempt to recall him from office this year. If Wisconsin voters want to see where a state ends up without the kind of reforms that Mr. Walker made, they need only look to the Greece next door.

The New York Times profiles the fight. It’s worth the read.

(Source: May 2011 NRTWC Newsletter)

In late 2008, GOP President George W. Bush “loaned” a total of $19.4 billion in federal taxpayers’ money to the Big Labor-controlled General Motors Corporation (GM).

Mr. Bush assured taxpayers they would get their money back.

But by the spring of 2009, we learned we would never get back any of the money Mr. Bush had handed over to GM shortly before he left office. His successor as President, Democrat Barack Obama, announced GM would never have to settle up with taxpayers.

President Obama simultaneously earmarked an additional $30 billion in taxpayers’ money to by-then bankrupt GM.

In exchange, taxpayers got a 61% stake in the money-losing company.

Echoing Mr. Bush, Mr. Obama and his advisors insisted that, when the government eventually sold off its whole stake in GM, taxpayers would get the entire $30 billion back, and perhaps even reap a profit.

Just last August, the President said it again.

He told a CNBC interviewer: “We expect taxpayers will get back all the money my Administration has invested in GM.”

‘Government Officials Are Willing to Take the Loss’

No one but the President himself knows whether he actually believed this prediction when he confidently made it time and again, but it certainly hasn’t been fulfilled.

In November 2010, the government sold off 57% of its stake in GM at a loss of roughly $3.5 billion.

And just last month, the Obama Administration informed the Wall Street Journal and other major media that this summer it planned to sell off much of its remaining stake at — barring a sudden and unlikely jump in the price of GM stock — another multi-billion-dollar loss.

GM’s stock would be worth even less, and taxpayer losses on Mr. Obama’s “investment” would be far greater, had not the special bankruptcy deal the company made with the White House included a $45.4 billion tax break on future profits in addition to nearly $50 billion in direct handouts.

Arguably, therefore, federal taxpayers’ total loss will be even greater than the $50 billion directly handed to Big Labor-controlled GM by the Bush and Obama administrations.

“Government officials are willing to take the loss,” the Journal reported April 19, because the White House wants to put the matter to rest before the beginning of the 2012 presidential election year.

Autoworkers Union Bosses Are The Chief Beneficiaries Of the GM Bailout

“The GM bailout was obviously an awful deal for taxpayers, but that doesn’t mean it was a good deal for the company’s rank-and-file employees,” said National Right to Work Committee President Mark Mix.

“As professor Todd Zywicki, a specialist in the law-and-economics field, recently pointed out in an article for National Affairs, had there been no bailout, GM ‘would almost certainly have been re-organized,’ producing a ‘company more competitive than the one that emerged from the bailout process.’

“As things stand, nearly two years after the company emerged from bankruptcy on taxpayers’ dime, its market share of U.S. sales continues to shrink, and its cars dominate Forbes magazine’s ‘worst on the road’ list. There isn’t much of a future in working for such a company.

“On the other hand, the United Autoworkers [UAW/AFL-CIO] union bosses whom the White House effectively left in charge of GM have profited from the bailout.

“They wielded their government-granted monopoly-bargaining power to impose wasteful work rules on the company that played a central role in dragging it down.

“Nevertheless, the bailout gave the UAW elite a 17.5% stake in the company, part of which they were able to sell for $3.4 billion last November. Relative to taxpayers and workers, the UAW brass have made out like bandits.”

Actuaries trying to accurately reflect the state of the California pension system were rebuffed by the CalPERS Board lead by Neal Johnson of the Service Employees International Union who told the Board it was better to hide reality. “I was afraid we were going to throw gasoline on the fire in the public pension debate,” Johnson told a CalPERS committee after a key vote.

Wouldn’t union members and pensioners rather know the true state of the pension fund?

Even as they scream for “workers’ rights,” the one workers’ right that union bosses despise is the Right To Work.  Big Labor and its overwhelmingly Democratic allies oppose a woman’s right to choose whether or not to join a union. Instead, they prefer that predominantly male employers and labor leaders make that choice for her.

The American Left has hoisted “choice” onto a pedestal taller than the Washington Monument. Liberals and their Big Labor buddies will race to their battle stations to defend a woman’s right to choose to abort her unborn child. Meanwhile, they holler themselves hoarse to prevent her (and her male counterparts) from freely choosing to accept or avoid union membership.

Sen. Jim DeMint, R-S.C., understands that exercising this choice is a basic human right, and neither private employment nor government work should require joining or paying dues to a union.

“Many Americans already are struggling just to put food on the table,” DeMint said, “and they shouldn’t have to fear losing their jobs or face discrimination if they don’t want to join a union.” Thus, on Tuesday, DeMint introduced the National Right to Work Act.

Notwithstanding that right-to-work states are comparatively prosperous engines of job growth, the case for right-to-work is not merely economic but also moral.

“Government has granted union officials the unprecedented power to force individual employees to pay up or be fired and to coerce workers into subsidizing union speech,” says the National Right to Work Committee’s Patrick Semmens. “This fundamental violation of individual liberty — an infringement on freedom of speech and freedom of association — finally would end with passage of the NRTWA.”

“Compulsory unionism…should not be lawful under a free government or tolerated by a free people,” Donald R. Richberg argued in his book, “Compulsory Unionism: The New Slavery”. As a labor attorney and federal official, Richberg helped draft landmark union laws, including the 1926 Railway Labor Act, the 1933 National Industrial Recovery Act, and the 1947 Taft-Hartley Act. Later in his career, however, Richberg considered such legislation authoritarian.

If, however, unions must dragoon workers into their ranks, why should government allow or even mandate such bondage?

Last October, pollster Frank Luntz surveyed 760 private- and public- sector unionized employees. Eighty percent agreed that union membership and dues should be optional. Hence, the National Right To Work Act is good policy and good politics — if only Republicans and free-marketeers would promote it.

Obviously, a bailout would do nothing but kill efforts to reform the system. It would allow union bosses to continue to press for higher salaries and benefits for government workers and the politicians who they elected would have no reason to say no.

Keep an eye out on this issue. It is the next big labor bailout on the horizon.

Grass-Roots Right to Work Efforts Expanding in Midwestern States

All across America, Right to Work states have long benefited from economic growth far superior to that of states in which millions of employees are forced to join or pay dues or fees to a labor union just to keep their jobs.

But over the past decade, the contrast between Right to Work states and forced-union-dues states has been especially stark in the Midwest.

Four Midwestern forced-unionism states — Michigan, Ohio, Illinois and Indiana — suffered absolute private-sector job declines over the past decade that were worse than those of any of the other 46 states. Midwestern forced-unionism states (the four just mentioned, plus Missouri, Wisconsin and Minnesota) lost a net total of 1.88 million private-sector jobs.

Combined, these seven forced-unionism states had 8.1% fewer private-sector jobs in 2009 than they did back in 1999.

Meanwhile, the five Midwestern Right to Work states (North Dakota, Nebraska, South Dakota, Iowa and Kansas) experienced an overall private-sector job increase of 2.3%.

Moreover, from 1999 to 2009, real personal income in Midwestern Right to Work states grew by 17.3% — an increase two-and-a-half times as a great as the combined real personal income growth in Midwestern forced-unionism states.

State Right to Work laws prohibit the firing of employees simply for exercising their right to refuse to join or bankroll an unwanted union.

At this time, 22 states have Right to Work laws on the books. However, because of intensifying grass-roots efforts in many of the remaining 28 forced-unionism states, the number of Right to Work states could be on the rise over the course of the next few years.

Recession’s End Won’t Suffice to Revive Big Labor-Controlled States

“More and more citizens of Big Labor-controlled states like Michigan, Ohio, Illinois and Indiana recognize that their states require fundamental reform in order to get their economies back on track,” observed National Right to Work Committee President Mark Mix.

“The fact is, compulsory unionism impedes private-sector job creation and income growth in every part of the business cycle. It’s clear that the national recession’s end won’t suffice to turn Michigan, Ohio, Illinois and Indiana around.

“On the other hand, there is strong evidence that economically troubled states could greatly accelerate their job and income growth by passing Right to Work legislation.”

One recent example of such evidence is a scholarly article by eminent economist Richard Vedder. A professor on the faculty of Ohio University in Athens, Ohio, and a specialist in labor, taxation and education issues, Dr. Vedder is the author of more than 100 academic papers as well as several books.

One of his books, coauthored with fellow Ohio University economist Lowell Galloway, is the acclaimed Out of Work. It received the Sir Anthony Fisher International Memorial Award and was also a Mencken Award Finalist.

In his article entitled “Right to Work Laws: Liberty, Prosperity, and Quality of Life,” appearing in the Winter 2010 edition of Cato Journal, Dr. Vedder reported the results of a regression analysis he did to test the economic impact of Right to Work laws.

Right to Work Law ‘Would Have Increased Per Capita Income by an Extra $2760′

Specifically, Dr. Vedder sought “to relate the rate of growth in real per capita personal income from 1977 to 2007 for the 48 contiguous U.S. states to the existence” of Right to Work laws.

The analysis controlled for each state’s tax burden, the share of its adults with college degrees, land area, and several other variables.

Dr. Vedder found “a very strong and highly statistically significant . . . positive relationship between” Right to Work laws and economic growth. He elaborated: Suppose two states both “had per capita income of $24,000 in 1977.”

Real per capita income in the state without Right to Work protections “would have risen to $36,000 in 2007, compared to $38,760″ in the Right to Work state. Right to Work protections “would have increased per capita income by an extra $2760 — or over $11,000 annually for a family of four.”

Dr. Vedder concluded: While alternative models “might offer somewhat different conclusions, . . . based on existing evidence, a strong case can be made” that Right to Work laws “have a positive impact on U.S. living standards.”

But despite all the evidence of Right to Work laws’ economic benefits, and despite the fact that nearly 80% of Americans who regularly vote support the Right to Work as a matter of principle, passing a state Right to Work law is never easy.

Unions that file federal disclosure forms rake in a total of roughly $20 billion a year in (mostly forced) dues and fees, government grants, rents, interest, and other revenues. And union bosses deploy a huge share of that money for politics and lobbying.

Freedom-Loving Citizens Must Be Mobilized to Pass More Right to Work Laws

If freedom-loving citizens are to counter successfully the might of the union political machine and prevail upon their elected officials to adopt a state Right to Work law, they must first be mobilized.

For years, grass-roots efforts to pass Right to Work legislation in the Midwest have been assisted by state groups like the Lansing-based Michigan Right to Work Committee and the Indianapolis-based Indiana Right to Work Committee.

In state after state this summer, these groups are mobilizing pro-Right to Work citizens to contact their legislative and executive candidates with thousands of postcards, letters, and phone calls urging them to oppose forced unionism.

Already, many politicians who were riding the fence have decided to take a stand in favor of Right to Work.

“Michigan, Ohio, Illinois and Indiana have long had reputations as Big Labor strongholds,” commented Mr. Mix. “Union bosses remain very powerful in much of the Midwest, largely because of their government-backed domination of public-sector employment.

“However, when a state’s private-sector job gains are paltry or negative during periods of nationwide economic growth, and its job losses are out-sized during recessions, then its citizens eventually get fed up.

“Once a critical mass of ordinary people become determined to change the way their state operates, union special interests can’t stop them.

“That’s why, in 2010, the pressure on Great Lakes state politicians to support Right to Work is mounting, even in Michigan, of all places!”

Right to Work Laws A Matter of Principle

Mr. Mix added that a desire to make their states more economically successful is not the sole motivation for supporters of state Right to Work legislative efforts:

“The Right to Work is a matter of principle as well as economics. Right to Work laws’ fundamental purpose is to protect the employee’s personal freedom of choice.

“Commitment to principle helps explain why so many National Committee members who live in a state that already has a Right to Work law are eager to offer their assistance to efforts to pass such laws in the remaining 28 forced-unionism states.

“No American should be forced to join or bankroll a union as a condition of employment. That’s why the Committee also continues to work for passage of national Right to Work legislation repealing all federal labor-law provisions that authorize forced union dues and fees.

“Effectively, that would make all 50 states Right to Work states.”

Unlike Unionized Workers’ Pension Funds, Union Bosses’ Are Secure

There’s no denying the fact that federal labor law grants union officials extraordinary power over unionized employees. More candid apologists for union monopoly bargaining and forced union dues and fees have long acknowledged that fact.

Authorizing union bosses to get workers who don’t wish to join a union fired for refusing to fork over union dues or fees is coercion, blunt Big Labor apologists concede, but it is for the workers’ “own good.”

In Practice, Forced Unionism Is Impossible to Defend

Big Labor academic Allan Pulsipher once explicitly defended compulsory unionism as a “legitimate form of coercion in a free market economy”!

Reasonable people may disagree about whether it is theoretically possible that a worker could benefit from being forced to allow an unwanted union to have “exclusive” power to negotiate with the business over his or her pay, benefits, and working conditions.

Some well-intentioned people might even be able to defend, in theory, forcing workers to pay dues or fees for Big Labor “services” they didn’t ask for, and don’t want.

However, practical experience shows that union bosses rarely wield their coercive privileges to achieve objectives furnishing long-term benefits to unionized workers. Instead, union dons take care of themselves.

Union Chiefs ‘Know How to Fund a Pension Plan Properly, If They Choose to’

One remarkable example of how forced unionism benefits union bosses, not workers, pertains to pension funds.

As economists Diana Furchtgott-Roth and Andrew Brown pointed out in a well-documented study for the Hudson Institute late last year, the pensions that monopolistic unions negotiate for workers are disproportionately underfunded, compared with other pensions.

In 2006, for example, the last year completely unaffected by the recent recession, only 17% of union-negotiated pension plans were fully funded according to the criteria established by the federal Pension Protection Act (PPA).

Under the PPA, pension funds that have less than 80% of the assets needed to pay out scheduled benefits are considered “endangered.” In 2006, 41% of union-negotiated funds were endangered. In fact, union-negotiated funds were three times as likely to be endangered as nonunion funds.

And union-negotiated plans were 13 times more likely (13% vs. 1%) to fall under the PPA’s “critical” status, reserved for pensions that are less than 65% funded.

As Ms. Furchtgott-Roth pointed out in a follow-up op-ed for the New York Daily News, union chiefs “know how to fund a pension plan properly, if they choose to.”

She and Mr. Brown sampled 30 union professional staff pensions “among unions that sponsor the largest 46 rank-and-file” multiemployer plans and found that union bosses’ own plans “were 93% funded,” whereas the worker plans had only 70% “of the funds needed to satisfy their obligations.”

‘A Worker Is the Best Judge of Whether He or She Benefits From Unionism’

National Right to Work Committee President Mark Mix commented:

“The recent Hudson Institute study contrasting the pension security of unionized employees with those of union-free employees and of union bosses illustrates the fact that employees are typically harmed, not helped, by compulsory unionism.

“Undoubtedly, some employees believe they benefit from being in a union. But the system only works for employees as a group and for the country when we trust employees to join and pay dues to the union voluntarily.

“A worker is the best judge of whether he or she benefits from unionism.”

Mr. Mix concluded that the Hudson Institute pension study reaffirms the need for passage of the National Right to Work Act, introduced in the current Congress by Iowa GOP Rep. Steve King as H.R.4107.

H.R.4107 would repeal all federal labor-law provisions that authorize the firing of employees for refusal to pay union dues or fees.

Enactment of this bill, Mr. Mix noted, “would greatly strengthen union officials’ incentive to do what’s best for the employees they purport to represent, rather than feather their own nests.”

He encouraged Committee members across the country to contact their congressmen and urge them to cosponsor H.R.4107, the National Right to Work Act, if they have not already done so.

Ohio Town Council Cuts Through Big Labor/White House Fog 

Marietta, which has only about 15,000 residents, but enjoys a place of honor as the oldest city of any size in Ohio, is located more than 230 miles outside the Washington, D.C., Beltway. 

And from the vantage point of Marietta’s community building at Lookout Park, where the town council considered adoption of a so-called “project labor agreement” (PLA) on May 13, it appears to be far easier to see and state the obvious than it is at the White House or on Capitol Hill. 

This spring, building trades union bosses lobbied furiously to convince the council’s seven members to impose a Big Labor PLA on employees and firms seeking to participate in the renovation of the town’s former Ohio Bureau of Employment Services building into a new municipal court facility. 

Parkersburg Marietta Construction and Building Trades Council union President Bill Hutchinson claimed, time and again, that the reason he and his cohorts were twisting arms to get a PLA was to ensure that “local” workers got the jobs. 

Finally, at the council’s May 13 meeting, Councilman Jon Grimm decided to test building trades union bosses’ sincerity. 

Mr. Grimm called attention to the provision in the PLA mandating that 50% of any contractor’s employees be registered with the union and pay union dues, even if they weren’t union members, and didn’t want to join. 

Would union officials accept a PLA retaining all the other provisions, but excluding “mandatory union membership”? Mr Grimm asked. 

Vast Majority of ‘Local’ Construction Workers in Marietta Aren’t Unionized 

Marietta law director Roland Riggs, who had hammered out the PLA deal with union officials, bluntly responded: “I don’t believe the folks from the building trades council would be interested in signing an agreement if that were removed.” 

A crowd of union militants, including several union officials, was in the room. No one from the crowd contradicted Mr. Riggs. 

“The plain fact is, the vast majority of ‘local’ construction workers in Marietta, Ohio, are union-free, and show no signs of wanting to be unionized,” observed National Right to Work Committee President Mark Mix. 

“According to labor scholars Barry Hirsch and David Macpherson, just one in four construction workers across the state of Ohio is currently under union monopoly bargaining. And southern Ohio, where Marietta is located, is much less unionized than northern Ohio. 

“Forcing independent local hardhats to pay dues to an unwanted union in order to work on taxpayer-funded projects is no way to ‘help’ them — and a Marietta council majority had no trouble seeing the truth and voting down the PLA. 

“Unfortunately, all too many Inside-the-D.C. Beltway politicians from President Obama on down seem to have a much harder time deconstructing the phony claims of Big Labor bosses demanding union-only PLAs on taxpayer-funded public works. 

“For example, in issuing Executive Order 13502, promoting union-only PLAs for federal taxpayer-funded public works in February 2009, the President mechanically repeated Big Labor propagandists’ contention that PLAs promote ‘economy.’ 

“The truth is exactly the opposite. By discriminating against the union-free majority of construction employees, PLAs jack up taxpayer construction costs by a minimum of 10–20%, according to nonpartisan researchers. 

“Even a recent study commissioned by Obama appointees at the Department of Veterans Affairs predicted that PLAs would raise taxpayer costs in markets like Denver, New Orleans and Orlando. 

“But rather than cancel the PLA executive order after Veterans Affairs found it would fail to accomplish its purported objective, the Obama Administration proceeded to implement it this April!” 

Right to Work Movement Is Fighting Back 

“Fortunately, there’s still hope that the Obama Administration’s anti-taxpayer E.O.13502 can be stopped,” Mr. Mix continued. The legal system is one possible means. 

In April, attorneys for the Committee’s sister organization, the National Right to Work Legal Defense Foundation, filed a federal court brief charging that a California PLA illegally discriminates against independent construction workers. (Mr. Mix is president of the Foundation as well as of the Committee.)If the Foundation’s argument in this case (known as Rancho Santiago) prevails, that will raise serious questions about the legal viability of E.O.13502.

It is galling for private sector workers to see so many public sector workers thriving because of the power their unions exercise. Take California. Investigative journalist Steve Malanga point out in the City Journal that California’s schoolteachers are the nation’s highest paid; its prison guards can make six-figure salaries; many state workers retire at 55 with pensions that are higher than the base pay they got most of their working lives. All this when California endures an unemployment rate steeper than the nation’s. It will get worse. There’s an exodus of firms that want to escape California’s high taxes, stifling regulations, and recurring budget crises. When Cisco’s CEO, John Chambers, says he will not build any more facilities in California, you know the state is in trouble.

Tucked inside the so-called “Financial Reform” legislation making its way through the Senate is a provision that would give union bosses the power to influence the boardrooms and policies of our nation’s largest companies.  

The bill denies states the ability to make rules how corporate boards are established and run and hands the power to the federal government through the SEC.  Union bosses are expected to use the provision to  affect corporate boards to force pension fund investors to obtain more seats on those boards and that means union pension funds will suddenly have more influence on business simply because of their influence in Washington.

General Motors is owned in part by the United Auto Workers. In an effort to help spin the bankruptcy and bailout, the Obama Administration recently made an outrageous claim declaring that the company had “repaid” its $6.7 billion loan from the government.  Malarky.

Fox News reports that the repayment was made by dipping further into the bailout money pot:

“The hype is not the reality,” Sen. Charles Grassley, R-Iowa, wrote in a column on FoxNews.com over the weekend. “It is far from clear how GM and the Obama administration could honestly say, much less trumpet in prime time television ads, that GM repaid its TARP (Troubled Asset Relief Program) loans in any meaningful way.”

Grassley wrote a letter last week to Treasury Secretary Timothy Geithner expressing his concerns and asking for more information about why the company was allowed to use bailout money to repay bailout money.

The $6.7 billion is also just a fraction of the $52 billion General Motors received in government aid. Grassley said lawmakers are being told government losses on GM are expected to exceed $30 billion.

The TARP inspector general, Neil Barofsky, bluntly told the Senate Finance Committee during a hearing last week that the repayment “is just other TARP money” and lawmakers should not “exaggerate” the feat.

“It sounds like they’re kind of like taking money out of one pocket and putting it in the other to do that,” Sen. Tom Carper, D-Del., said at the hearing.

Sen. Richard Shelby, R-Ala., expressed similar concerns Sunday on NBC’s “Meet the Press,” saying it’s “misleading” for the administration to claim the company has paid back its loans.

The GM ad could potentially land the company in trouble with the Federal Trade Commission over its truth-in-advertising laws, which prohibit ads that are “likely to mislead consumers.”

The FTC would not comment on the specific GM ad.

General Motors admits that the company is repaying the loan with other government money, but says a year ago “nobody thought we’d be able to pay this back.”

New Jersey Gov. Chris Christie is taking on the government unions head on.  George Will describes the financial situation in New Jersey as “the nation’s worst.”  Christie has issued executive orders that have saved $2.2 billion in state spending but he won’t be able to get things under control unless he reforms the gold-plated benefits of the government employee unions’ and that is what he is doing.  Wonder if the governors of other states — including Arnold Schwarzenegger — are paying any attention.

So he closed the $2.2 billion gap by accepting 375 of 378 suggested spending freezes and cuts. In two weeks. By executive actions. In eight weeks he cut $13 billion — $232 million a day, $9 million an hour. Now comes the hard part.

Government employees’ health benefits are, he says, “41 percent more expensive” than those of the average Fortune 500 company. Without changes in current law, “spending will have increased 322 percent in 20 years — over 16 percent a year.” There is, he says, a connection between the state’s being No. 1 in total tax burden and being No. 1 in the proportion of college students who, after graduating, leave the state.

Partly to pay for teachers’ benefits — most contribute nothing to pay for their health insurance — property taxes have increased 70 percent in 10 years, to an average annual cost to homeowners of $7,281. Christie proposes a 2.5 percent cap on annual increases.

A new study by a group of Stanford University graduate students, the shortfall facing California’s public pension systems could reach more than half a trillion dollars over the next decade and a half.  Government employee unions are amongst the most powerful in the state and have driven the benefits for workers well beyond what the state can afford.  The iron grip of power has prompted upstart Democratic candidate for Senate Mickey Kaus to say “I’ve been arguing that Obama’s national Democratic party is less beholden to the unions than our state Democratic party. That’s true…”

(Source: March 2010 Forced-Unionism Abuses Exposed)

Chris Christie, New Jersey’s freshly minted GOP governor, made national news on February 11 in an address to the state Legislature regarding his proposal to balance the Fiscal Year 2010 budget, which is, as he pointed out, “in shambles.” Gov. Christie pushed for $2 billion in spending cuts just for the remaining four-and-a-half months of FY 2010.

Why isn’t he following in the footsteps of previous New Jersey governors in both parties who raised taxes and/or tinkered with fiscal timetables when faced with large budget deficits? “The old ways of doing business have not served the people well,” explained the governor.

Mr. Christie was surely right about that. The Garden State now stands before a fiscal abyss not primarily because of the recent national recession, but because New Jersey’s heavily unionized public sector has for many years been sucking resources and vitality out of the state’s beleaguered private-sector employees and businesses.

For example, during the five years from 2003 to 2008, even as the national economy boomed, New Jersey’s private-sector employment grew by a total of just 1.5%, roughly a quarter of the national average. Meanwhile, state and local government jobs in New Jersey (more than two-thirds of them under union monopoly-bargaining control) soared by 5.9%, nearly four times New Jersey’s private-sector job growth.

And it’s not just the wages, salaries and benefits of active unionized government employees that are growing far more rapidly than those of private-sector employees. A large and rapidly growing share of public-employee compensation costs for New Jersey’s taxpaying individuals and firms come from outsized public pension and retirement-health benefits.

Union negotiators with monopoly-bargaining privileges, as well as Big Labor lobbyists and the politicians who do their bidding, have over the years established policies in New Jersey that encourage a wide array of healthy public employees to retire while they are still in their early fifties with pension and health benefits worth $100,000 or more a year.

No wonder New Jersey’s property taxes in 2009 were an average of nearly $7300, the highest in the nation and more than 70% higher than they had been just a decade earlier. No wonder New Jersey’s business tax climate was the worst in the nation both this year and last year, according to the nonpartisan Tax Foundation. No wonder, in 2009, Chief Executive ranked New Jersey a dismal 48th out of the 50 states for doing business, based on a survey of 543 CEOs.

Unless New Jersey’s elected officials can resolve to curtail sharply the growth in the cost to taxpayers of unionized government employees’ and retirees’ compensation, the state faces a very bleak economic future and possibly even bankruptcy.

The budget reforms announced and recommended by Mr. Christie in his February 11 address to the Legislature, including a freeze on expenditures of over $550 million in unspent funds for the rest of FY2010 and raising public-employee contributions to pension and other benefit funds, together constitute a modest step in the right direction, but no more than that.

And at this writing it is still unclear whether the Big Labor-dominated New Jersey Legislature will adopt even the tentative public spending reforms that are now on the table.

In a February 28 editorial, Newark’s Star-Ledger, New Jersey’s largest local newspaper, glumly but realistically predicted: Union officials “will treat this as a life-and-death fight. They will spend millions on radio and TV ads and bumper stickers. They will mobilize lobbyists. They will activate their fleets [of union militants].”

By all appearances, government union bosses in New Jersey do not care whether or not the state goes under.

Their intransigence makes it more obvious than ever before that all realistic, long-term solutions for New Jersey’s government-spending crisis must involve rolling back public-sector union officials’ special privileges, including, first and foremost, the monopoly privilege to speak for all front-line employees, including those who choose not to join the union and want nothing to do with it, regarding workplace issues.

Despite his evident good intentions, Chris Christie has yet to demonstrate he is prepared to fight to narrow and, ultimately, eliminate government union chiefs’ monopoly-bargaining powers. But unless he does take on that fight, his efforts to bring New Jersey back from the brink are almost certainly doomed to fail.

MoneyNews.com looks at the SEIU’s campaign to “centralize” all retirement plans, including your own 401K, under a new “retirement system”:

The SEIU, which was integral to the election of Barack Obama as president, is working with the left-leaning Economic Policy Institute (EPI), and the National Committee to Preserve Social Security and Medicare, on SEIU’s plan, called “the Retirement USA Initiative.”

Claiming that the retirement system in place now has “failed most Americans,” EPI vice president Ross Eisenbrey, told a labor union publication that “account balances have fallen by a third since late 2007, leaving many older workers unable to retire just as our economy is shedding millions of jobs.”

“The failure is broad and deep. It’s not just a few people falling through the cracks: most of us already are in the ravine. Three in 10 have only a 401(k) or similar savings plan, and the rest of us are totally out of luck,” said Eisenbrey.

Eisenbrey said that the median 401(k) account balance was $25,000 in 2006, and the median for workers near retirement was $40,000.

“Half of those who had a 401(k) were nearing retirement with less than $40,000 in their account,” said Eisenbrey, who is trained as a lawyer and was a Clinton administration appointee from 1999 through 2001.

The proposed retirement system would be operated under the following parameters:

• Benefits that move with you, even if you change jobs

• Payouts only at retirement

• Shared responsibility among employers, the government and employees

• Pooled assets, controlled by professional investment managers

“The financial crisis and the economic recession have shone a spotlight on the inadequacies of today’s system,” said Stephen Albrecht, director of benefits for SEIU.

With the uncertainty in today’s global economy, creating a whole new federal entitlement for American workers may not be easy to accomplish for these groups or their allies on Capitol Hill and in the Obama administration, as America’s creditors are already getting nervous.

Chinese Premier Wen Jinbao is telling U.S. policymakers that he is concerned about the “safety” of his country’s already huge holdings of U.S. debt.

“We have lent a huge amount of money to the United States,” said Wen, according to a report in the Financial Times. “We are concerned about the safety of our assets. To be honest, I am a little worried. I request the U.S. to maintain its good credit, to honor its promises and to guarantee the safety of China’s assets.”

Nonunion workers and private companies could be forced into absorbing the financial liabilities of underfunded union pension plans, thanks to pending health care mandates and an executive order that could be finalized this year, policy analysts and trade group representatives have concluded.  Kevin Mooney has the story.