National Education Association Supports Bigger More Expensive Government

The National Education Association, the powerful teachers' union, is involved with a host of causes -- only one of which concerns the education of children, according to some observers.

The causes it champions range from "civil rights" and "human rights," to Social Security, voting reform and health care. In every case, the union's agenda is for bigger and more expensive government, experts say. The NEA has 2.2 million members and estimated 1993 annual revenues of $750 million.

The Alexis de Tocqueville Institution studied the group's 1994 legislative agenda and found:

• If all its policy recommendations were enacted, it would cost taxpayers and additional $702 billion a year and increase the size of government by nearly 40 percent.

• These plans would cost the average American family of four an extra $10,544 a year.

• The NEA gave Democrats 99 percent of its PAC money in 1994 -- nearly $2.27 million -- despite the fact that most of its members voted for Ronald Reagan in the 1980s.

• The average House candidate backed by the NEA in 1994 sought to raise federal spending by $302.2 billion a year, while the 53 incumbents NEA opposed would have cut spending an average of 822.6 billion a year.

Critics say the NEA is wandering far afield from its stated mission to advance education for children. They also note that it is vehemently opposed to privatizing education -- an educational reform which many hope will upgrade the quality of teaching in the nation's classrooms.

With the election of its new president, John J. Sweeney, it appears the AFL-CIO will be steered toward a more militant, hard-left course.

Sweeney has said labor must be a "worker-based movement against greed, multinational corporations, race-baiting and labor-baiting politicians."

Those who have watched Sweeney lead the Service Employees International Union -- which represents janitors and other support workers in office buildings -- say he is not above strong-arm tactics, fomenting violence and acts of retribution. The union's Justice for Janitors campaign featured guerrilla-style sidewalk and traffic blockades in several major cities.

The AFL-CIO's legislative agenda includes:

• A federal ban on allowing employers to hire replacement workers during a labor strike.

• Opposition to enforcement of the Beck Decision, which allows workers to withhold from union dues money that might go toward any activities other than collective bargaining, contract administration and grievance proceedings.

• Opposition to the Freedom from Union Violence bill which would close loopholes that hinder application of anti-extortion statutes to unions.

• Opposition to a national Right to Work law.

Source: Carl Horowitz, "New Militancy at the AFL-CIO?" Investor's Business Daily, November 14, 1995.

Although postal workers are already paid 30% more than their counterparts in the private sector, according to the Postmaster General, their pay is going up again.

Under a new agreement with the postal union:

• Workers will receive a lump-sum payment equal to 2.78% of their base salary for the first year.

• In the second year, they will receive a 1.2% increase on top of a cost-of-living adjustment (COLA) increase.

• In the third year, they will receive a $400 lump-sum payment, plus the COLA.

• In the final year of the agreement, they will get a 1.2% increase plus the COLA.

The settlement, which was negotiated by a federal arbitration board, is expected to force a 3-cent increase in the cost of mailing a first class letter - to 35 cents - by 1998.

The president of the American Postal Workers Union commented that "we could have done a lot worse."

Source: Bill McAllister, "Modest Pay Hike Delivered to Largest Postal Union," Washington Post, October 2, 1995.

Federal law is blocking local efforts to improve public transit and lower costs by competitive contracting with private companies to run local bus systems.

Section 13(c) of the 1964 Federal Transit Act, reaffirmed by the current Congress, requires that any public transit worker "negatively impacted" by competition -- in other words, who loses his job -- may receive six years of salary and benefits. This is one of several mandates tied to federal mass transit funds that are aimed at protecting unionized workers from competition.

• The estimated cost of these mandates to states and localities is two to three times the value of the federal subsidy.

• The federal government contributes less than 5 percent of all mass-transit operating funds, about $4 billion a year, but its mandates gobble up 10 percent to 15 percent of local mass transit costs.

• Section 13(c) alone costs local transit authorities $2 billion to $3 billion a year, according the Heritage Foundation.

• For example, since municipal bus drivers are often unionized, their salaries are often three to four times those in the private sector.

Since federal subsidies began 30 years ago, government at all levels has spent $200 billion on mass transit projects. However, in that time transit ridership has dropped 15 percent and operating costs have increased 105 percent.

• Competition could save mass transit 20 percent to 60 percent of its costs each year, according to consultants for the American Legislative Exchange Council.

• With expanded routes and better service, ridership would rise by 50 percent, and an estimated 100,000 new workers would be added.

• In Indianapolis, for example, competitive bidding to provide its "Open Door" service for the disabled allowed it to serve more than twice the number of daily riders for the same amount of money.

Source: John Walters (Heritage Foundation), "Bus-jacking the Revolution," Policy Review, No. 75, January/February 1996.

Some people have a "taste for racial discrimination," according to Gary Becker, a Nobel laureate in economics. In a competitive market, employers usually find that indulging such a taste is costly, resulting in lost income - except when government fixes the price of labor. Setting wages above the market price allows prejudiced employers to discriminate without paying the economic penalty that comes from drawing on a smaller pool of workers.

An example is the Davis-Bacon Act, which requires contractors on federally financed construction projects to pay workers the "prevailing wage," usually that of unionized workers and often twice the nonunion wage.

Before Davis-Bacon passed in 1931, employment of blacks in construction trades was rising relative to whites in 38 states outside the South, but afterward the trend reversed.

• Employment in construction trades rose 31.5 percent overall from 1910 to 1920 - 31.3 percent for whites and 46.5 percent for blacks.

• Between 1920 and 1930, employment rose 23.5 percent overall - 22.9 percent for whites and a whopping 65.5 percent for blacks.

• However, between 1930 and 1940, while construction jobs overall declined during the depression by 21.7 percent and by 21.6 percent for whites, black employment declined the most, by 24.9 percent.

Davis-Bacon-type laws apply to 27 percent of all construction in the United States, enough to slow progress in black construction employment relative to other occupations:

• In 1930, blacks were employed in construction crafts at 31.5 percent of their proportionate share of the whole population, and by 1990 were at 70.4 percent of their proportionate share - still 30 percent below the expected "color-blind" rate.

• However, in six nonconstruction trades in which blacks had only 13 percent of their proportionate share of jobs in 1930, by 1990 they held 125.5 percent of their share and were thus overrepresented by 25.5 percent.

The difference between black and white unemployment rates in construction occupations grew from 1.2 percentage points in 1930 to nearly 2.5 points in 1940, 3.9 points in 1980 and an estimated minimum of five percentage points in 1990. This differential is partly due to the discrimination unintentionally fostered by Davis-Bacon.

Source: Richard Vedder and Lowell Gallaway, "Cracked Foundation: Repealing the Davis-Bacon Act," Policy Study No. 127, November 1995, Center for the Study of American Business, Washington University, Box 1208, One Brookings Drive, St. Louis, MO 63130, (314) 935-5630.

Experts in local government administration say Los Angeles presents an object lesson in how not to run a county. To be sure, not all of Los Angeles's woes are of its own making: a poor local economy (defense cutbacks cost the county 60,000 aerospace jobs) and unfunded federal and state mandates (a whopping $1 billion last year) hit hard. But the real knife in the heart are out-of-control public payrolls.

• In January, the county's chief administrative officer warned that if nothing was done, the county would run a $517 million deficit in fiscal 1996, which begins next month.

• A blue-ribbon task force says the problem is even worse: the county has a $1 billion structural deficit (i.e., the gap between the revenues it brings in each year and the amount it spends without the budget gimmicks that have masked the deficit's size).

• Officials have tried to rely on quick fixes rather than major structural changes which could save money, such as privatization of the local health care system.

But public payrolls -- and the county's inability to say no to unions -- are the main problem, according to a study by the Rose Institute at Claremont McKenna College.

• Yielding to pressure from public employee unions, the county payroll has grown 15.64 percent since 1990 -- compared to only a 6 percent increase in per capita income among county residents.

• If county pay had grown just 10 percent in that time, taxpayers would ave saved $1.7 billion.

• Of the county's 85,000 workers, 1,225 earned more than $100,000 last year and 2,232 earned more than $90,000 -- not including overtime.

• Although the county disputes it, the Rose Institute study found that the county spent 34 cents last year in administrative costs for every dollar of welfare aid it gave out -- compared to 19 cents per dollar in 1977-78.

Among the suggestions for cost savings being made, two stand out: cut the number of county jobs and privatize the health care system.

• Los Angeles employs 9.4 workers per 1,000 county residents, compared to just 6.4 employed in San Diego County.

• lThe county should be able to combine or cut inefficient departments, reward good workers and punish bad ones.

• While more than one-half the beds in county hospitals went vacant last year, the country subsidized the hospital system to the tune of $434 million.

• The county could close non-productive facilities.

Source: Charles Oliver, "How Not to Run County Government," Investor's Business Daily, June 18, 1996.