There are is something interesting happening in the Wisconsin school system since Gov. Scott Walker and the Republican-dominated legislature eliminated collective bargaining rights for state government workers earlier this year.
According to Stuart Varney’s television interview of Robert Kraig, head of Citizens Action Wisconsin, on FOX Business News this afternoon, it was learned that Wisconsin teachers are retiring at double the normal rate. When Varney asked Kraig about this phenomena, he said it was due to their “fear” of having any [negative] changes to the level of their existing retirement benefits and, to a lesser degree, because of the required increased contributions they must make toward their own healthcare and retirement funds.
Although Kraig maintained that it was bad for Wisconsin to be loosing “seasoned” teachers–another view is that there will be an influx of newer teachers, at the bottom end of the pay scale, who bring a contemporary set of teaching skills and youthful committment to their new positions.
The two immediately positive results for the Wisconsin economy will be:
1. a substantial decrease in the unemployment rate in the state, as the departing teachers will no longer be considered as part of the labor force; and younger, [unemployed] teachers will become employed.
2. these new teachers will be immediately contributing [more] to the healthcare and retirement fund, versus the departing teachers.
This will be welcome music to the ears of the state’s trust fund actuaries, as any unfunded liabilities will begin to decrease precipitously, lowering the “burden” on the general operating funds of the state, and increase the budget surplus.
There is however a more far reaching change that will be likely occurring in Wisonsin, and across the nation.
As unions can no longer automatically deduct union dues from teachers paychecks, according to a recent article in The Economist, when this has happened in the past, the percentage of union members paying their dues collapses quickly.
The first such case was in 1992, when such a law was passed in Washington State, and as a result, the percentage of members paying dues dropped from 82% to just 11%. When Utah enacted such a ban on collections in 2001, a year later there were 90% fewer dues paying members. By 2011, Indiana has observed a 90% decline in union membership since automatic deductions were ceased in 2005. And, finally, in 2001, when Colorado passed a law requiring an annual vote to “re-authorize” automatic deductions of union dues, union membership fell by 70% [in that first year].
A majority of the states are now in various stages of the process to restrict, or eliminate, collective bargaining rights for public employees, whose benefit levels are causing severe strains on their annual budgets. And with there being a Republican majority in their legislatures and Governor’s offices since the November 2010 elections, this would appear to be the trend.
This is very bad news for the Democrat party.
First, the resulting deep cuts into union operating budgets, will force a reduction in their management headcount (because without collective bargaining it is not necessary) or even the elimination of many union locals
But, more importantly, union political contributions, one of Democrats largest sources, will nearly evaporate.
As we reported in a prior article, studies have shown that 94% of union political contributions have gone to Democrats, with just 6% going to Republicans, regardless of the political demographics of the union members–basically usurping the “political will” of all non-Democrat members.
So, it is easy to understand why, at the Labor Day Rally in Detroit, when James Hoffa, Jr., President of the Teamsters Union, called for union members to “take out” the Tea Party [members], it was obviously not intended as a “social invitation.”
History will most likely consider the Tea Party movement to have been the catalyst for bringing the “sunset” to public sector labor unions.