Wisconsin is, and is not, about the money

from David Ruccio

Is the ongoing battle over Governor Walker’s proposal to eliminate public sector collective bargaining in Wisconsin about the money? It is and is not.

On one hand, it’s not. Paul Krugman sees it as all about power.

what’s happening in Wisconsin isn’t about the state budget, despite Mr. Walker’s pretense that he’s just trying to be fiscally responsible. It is, instead, about power. What Mr. Walker and his backers are trying to do is to make Wisconsin — and eventually, America — less of a functioning democracy and more of a third-world-style oligarchy. And that’s why anyone who believes that we need some counterweight to the political power of big money should be on the demonstrators’ side.

Howard Schweber has a similar view.

IT’S NOT ABOUT THE MONEY. If I say it loudly enough, will anyone hear it? It’s about preserving collective bargaining and a governor who negotiates before he makes radical decisions and huge, transformative bills getting a public hearing before they are voted on. It’s about “democracy,” and it’s not really a coincidence that every petty tyrant you have ever heard of from Latin America to the Middle East started by crushing the trade unions.

IT’S NOT ABOUT THE MONEY. Every speaker, every sign, every chant in the crowd is about collective bargaining. You might not think that “meet us at the bargaining table” would make an effective chant, but you would be surprised. Walker introduced his bill and right away said that he would not negotiate — with anyone, about anything — and that if the public sector workers tried to have a work action he would call in the National Guard. That was before any protests! This Governor went to Defcon 4 and started warming up his nukes before anyone had even indicated a hostile intent. How bad is it? Even the Chair of the Madison Chamber of Commerce is starting to sound a little queasy.

Even the Green Bay Packer’s Charles Woodson understands that issues other than money are at stake.

Last week I was proud when many of my current and former teammates announced their support for the working families fighting for their rights in Wisconsin. Today I am honored to join with them. Thousands of dedicated Wisconsin public workers provide vital services for Wisconsin citizens. They are the teachers, nurses and child care workers who take care of us and our families. These hard working people are under an unprecedented attack to take away their basic rights to have a voice and collectively bargain at work.

On the other hand, money is a central issue—in Wisconsin, as well as Indiana, Ohio, and other states. That’s because many states do face a fiscal crisis right now, and corporations and wealthy individuals have made sure they’re not the ones who are going to be taxed to provide public services.

The Economist has joined the fray by highlighting the “high pay” and “inflated benefits” of the “overprivileged elite” of public sector workers—in the United States as well as Western Europe, Brazil, and elsewhere. They blame public sector unions for exercising monopoly power, stifling innovation, obtaining unrealistic levels of remuneration, and lowering the quality of government services.

The shift has also created tension between the public and private sectors. The private sector is dominated by competition and turbulence. Performance-related pay is the norm, and redundancy commonplace. The public sector, by contrast, is a haven of security and stability. Many people have jobs for life and performance measures are rare. The result is a paradox: the typical public worker is better off than the people he is supposed to serve, and the gap has widened significantly over the past decade. In America, pay and benefits have grown twice as fast in the public sector as they have in the private sector.

That’s the same language used by the American Enterprise Institute’s Andrew G. Biggs: to pit public- and private-sector workers against each other.

If ordinary Americans are to accept significant sacrifices in programs that are dear to them, they need to know that there isn’t a protected class receiving better treatment.

But as Richard Wolff explains, the public finance crisis can be explained by corporations’ ability to avoid paying taxes.

Since the second world war, corporations have shifted much of the federal tax burden from themselves to the public – and especially onto the middle-income members of the public. No wonder a tax “revolt” developed, yet it did not push to stop or reverse that shift. Corporations had focused public anger elsewhere, against government expenditures as “wasteful” and against public employees as inefficient. . .

Corporations repeated at the state and local levels what they accomplished federally. According to the US Census Bureau, corporations paid taxes on their profits to states and localities totalling $24.7bn in 1988, while individuals then paid income taxes of $90bn. However, by 2009, while corporate tax payments had roughly doubled (to $49.1bn), individual income taxes had more than tripled (to $290bn).

The fact is, the money exists to provide decent public services and decent pay and benefits to public-sector workers. It’s the surplus controlled by corporations and wealthy individuals, which they don’t want to give up in the form of taxes.

That battle over the surplus—which is taking place in Wisconsin, and at the state and national levels in the United States and around the world—is and is not about the money. It’s about how much of the surplus will be spent on public services and it’s about the role of workers—both public and private—in deciding how that surplus will be captured and spent.

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