NCPA - National Center for Policy Analysis


July 29, 2009

During the last two decades, California has been transformed from the nation's most anti-labor outpost to a state essentially run by public-sector unions, says Matt Welch, editor in chief of Reason Magazine.

Nearly three in five public sector workers are unionized, compared to less than two in five public employees in other states.  The Democratic Party, which is fully in hock to unions, has controlled the legislature and most statewide posts, with the notable exception of the governor's mansion, for more than decade. That means more government workers, higher salaries and drastically higher pension costs, says Welch.

  • According to Adam Summers, a policy analyst at the Reason Foundation, the state's annual pension fund contribution vaulted from $321 million in 2000-2001 to $7.3 billion last year.
  • According to public databases, more than 5,000 people are drawing pensions in excess of $100,000 from the state of California each year.

So pervasive is the union influence that big labor doesn't even try to defend its deleterious effects on California's finances, says Welch.  Just before the May 19 special election to plug the state's $24 billion budget deficit, a member of the Los Angeles Times editorial board asked Service Employees International Union chief Andy Stern to respond to charges that unions are the 21st-century equivalent of the railroads that were once all-powerful in California.  Stern verbally shrugged: "I think democracy is an ugly thing at times."

That ugliness has made the California budget, like those in most of the other 49 states, less efficient and more bloated, says Welch.  Government spending, unlike spending in the private economy, is a zero-sum game -- especially on the state level, since governors can't print money.  Every dollar spent gilding a pension is a dollar not spent funding an orphanage.

Source: Matt Welch, "California Screaming," Reason, August/September 2009.

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