Updated: July 18, 2013 3:38PM
A friend recently said he was surprised that I am a Democrat. When I asked him why, he said it was because he had read some of my sermonettes on the need to reform the state’s pension systems and to create more charter schools in Chicago — both measures vehemently opposed by public employee unions.
I told him I thought competitive standards and choice are just as important to Democrats as to Republicans. They are central to the American success story and to freedom.
A century ago, the main threats to competitive markets in this country came from big business. But today it seems to me that they come from big labor. Not all big labor. Where markets are vigorously competitive, overreaching employers or unions may damage each other, but they won’t damage competition or consumers generally. When a Twinkies goes out of business, someone else steps in and produces junk food.
The place where big labor poses the most serious threat is where competitive markets do not exist: state and local municipal services, including public schools. Here, overreaching union demands succeed because “consumers” — i.e., the public — have few if any competitive options. Most Illinois taxpayers will not move to another state because of the wasteful costs of keeping open underused Illinois prisons. Most Chicago school families cannot afford to pick up and move to a suburb to get their children into better schools.
The threat to the public interest is magnified by the fact that these unions exert enormous political power on the very public officials — legislators, governors and mayors — who write the laws governing pensions and charter schools, and who negotiate their wages and retirement deals.
We Democrats say we are looking out for the “little guys” — the famous “middle class.” Most of these folks work in competitive markets. Their compensation and benefits packages are shaped by supply-and-demand factors that constrain what people in comparable positions in the private sector are paid.
Not so with state and local government employees. Their salaries rarely have any relation to competitive standards. And public-sector retirement benefits — pensions and retiree health care — vastly exceed benefit levels available to most private-sector workers and taxpayers.
Where else but in Illinois government can a worker retire with a full pension at the age of 55 — and free health care? (Chicago city workers can retire with full pensions at age 50.) Does anyone believe these benefit levels reflect competitive standards?
Which “little guys” should we Democrats be looking out for? The 85 percent who work in the private sector, lack special clout, and pay taxes to cover the inflated tabs for state and city governments? Or the 15 percent who work in the public sector, who are insulated from market forces and use clout to get deals that competition does not allow?
Should we be looking out for the inner-city Chicago families who send their kids to failing schools? Or the teachers union leaders who have made those schools unmanageable?
As a friend told me after spending a couple of decades watching Illinois and Chicago city government at close range, the risk is not that the experience will turn a liberal into a conservative. The risk is that it will turn him into a radical.