No Way Out?

Police Interceptor of the New York City Police...

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This process was not unique to New York.  And now we are facing a pensions crisis driven by decisions like this.  I share the anger at politicians who gave away lavish unfunded pension increases as “free” political sweeteners to favored unions, and put their budgets on the inevitable road to ruin.  But it’s easy to forget that often, these politicians were in a no-win situation.  When crucial public sector workers collectively bargain, they end up with ruinous power over the taxpayers:  how many days can a city survive without its police, its transit workers, or its teachers?  In New York, strikes by such workers are technically illegal, but in practice, unless you’ve got a spare pot of policemen or transit workers, the illegality doesn’t do you any good, because you can’t fire the workers.  A single industrial company can maybe ride out such a transition, but a city like New York simply cannot.

That’s why those unions were historically barred from collective bargaining.  And perhaps unsurprisingly, I think that was the right call.  As we’re seeing in GM, even a mighty private sector union like the UAW can be forced to confront reality.  I’m not sure how that’s going to happen in the public sector, where the bargainers elect the folks on the other side of the table.

via The Peril of Procedural Reform – Business – The Atlantic.

Is there no way out? Of course there is – but few will like it. We always dislike the inevitable. When something just can’t go on, it won’t.

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