Collective Bargaining For Public Employees - Archive

Thirteen years ago, the California Chamber of Commerce and other big business organizations cut a deal with Governor Jerry Brown not to oppose a 30 percent temporary tax increase on individuals. Since then the state’s General Fund has extracted an extra $95 billion from individual taxpayers, including small businesses that pay business taxes at individual rates, and annual General Fund Expenditures have increased 165 percent.

Recent guests on Gov. Gavin Newsom’s podcast, such as MAGA influencers Steve Bannon and Charlie Kirk, might be stunned to learn about the policies the governor is pursuing between his stints masquerading as a friendly host for right-wing guests. So might Californians.

In its first 10 years, California’s “temporary” income tax increase enacted 13 years ago extracted $75 billion of extra payments from taxpayers. Since then, two more tax years have elapsed, implying $95 billion of total extra tax payments to date.

At the root of California’s poor public services is legislation signed by Governors Ronald Reagan and Jerry Brown in 1968, 1975 and 1977 that conferred collective bargaining rights on the public employees who provide those services. In the private sector, labor and management report to different parties…

Earlier this month we wrote to you about $195 billion in annual spending by California governments on compensation and benefits for public employees but that figure did not include spending by counties, which the Mercury News reported yesterday to be $45 billion per year.

If ever you had any doubt that governments in California are run primarily for the benefit of public employees, look no further than $195 billion of annual spending by those governments on compensation and benefits awarded by elected officials who receive support or avoid opposition by public sector unions.

Earlier this week, Elon Musk announced he was relocating the headquarters of two California companies to another state after Governor Gavin Newsom signed a law that Musk characterized as infringing on parental rights. Newsom responded by accusing Musk of being a vassal to Donald Trump in a tweet that said: “You bent the knee” to which Musk replied: “You never get off your knees.”

Often I’m asked whether California could levy a wealth tax on individuals. My answer is that, absent persistent political pressure by taxpayer advocates, the political door in California is always open to all forms of tax increases, including a wealth tax.

One of the first things I learned after Governor Schwarzenegger appointed me to the board of the California State Teachers’ Retirement System (CalSTRS) in 2005 is that public employees only contribute to their pensions upfront but taxpayers contribute upfront and are on the hook for 100 percent of any funding deficiencies.

Despite a healthy national economy, California has a budget deficit that Governor Newsom proposes to close in the main by drawing on budget reserves, borrowing money, shifting funds, and deferring spending — ie, steps normally taken only during recessions.

Why have corporations, unions and associations put up more than $10 million that Gov. Gavin Newsom is using for state and national advertisements featuring him? The answer is that Newsom has delivered billions of state dollars to them.

In 1968, Governor Ronald Reagan signed the Meyers-Milias-Brown Act establishing collective bargaining for California’s municipal, county, and local special district employees. Services for municipal, county and special district residents and taxpayers have been in decline ever since.

A grave threat to democracy in California is sitting on Governor Newsom’s desk. If signed by him, Assembly Bill 1 would allow legislative staff to form a government employee union. That means that the state employees who write and edit thousands of pieces of legislation every year and provide advice to elected legislators about those bills would become a special interest with business before the state.

One of our jobs each year is to review every bill and resist those not in the general interest. Legislators have submitted 2,115 bills* so far this session.

This report examines the compensation of California state correctional officers relative to several other groups. It examines wages in detail because of the richness of available data. It examines benefits in less depth because available data are far less comparable and detailed.

For decades, public employee unions and crony capitalists faced no resistance when using the CA Legislature to obtain financial and legal privileges at the expense of residents and taxpayers.

Recently a journalist concluded “the California Dream is dying.”

School employee unions in California weren’t always powerful. That started to change in 1975 when they were extended collective bargaining rights but that alone didn’t confer their dominance. The other ingredient was the failure of good government organizations to persistently resist their demands. Nearly six million California kids heading back to K-12 schools this week suffer the consequences. Treated more like captives than customers and all too often served by poorly-performing employees who can’t be fired, they haven’t even benefited from a doubling in spending per pupil eaten up by faster-growing pension costs.

Everyone knows 1968 shook the national political landscape but few know that was also the year the California Legislature and Governor Ronald Reagan quietly rolled California’s political environment — and not for the better. That’s they year they enacted the Meyers-Milias-Brown Act that endowed local and county personnel with the power to bargain collectively with the governments that employed them, thereby obtaining the power to collectively influence the lawmakers who approve their pay, benefits and work rules. Once the collective-bargaining door was opened, school and state employees set their eyes on the same prize, which they acquired in 1975 and 1977.

When I made San Francisco my home in 1977, little did I know that the California Legislature and Governor Jerry Brown had just made prison guards lords over state politics and policy. That’s the year lawmakers enacted the Dills Act, which extended collective bargaining rights to state employees. Since then, CA lawmakers have worked hard to please them, especially prison employees.

Recently I spoke to an organization that operates in fear of a Sacramento special interest. My response won’t surprise you: “Stop whining. Punch your weight. If your opponent runs their political affairs like a business, so must you.”

In 1968, Governor Ronald Reagan signed the Meyers-Milias-Brown Act endowing police and other local personnel with the power to bargain collectively with the governments that employ them, setting cities and counties on a path to fiscal disaster and turning local and county public employees into political powerhouses. The next decade, Governor Jerry Brown signed the Rodda and Dills Acts extending the same powers to school and state employees, producing the same disastrous outcomes. No three bills have done more damage to California’s governance.

Conventionally, Ronald Reagan is characterized as conservative, but as governor in 1968, he signed the Meyers-Milias-Brown Act that endowed police and other local public employees with the power to bargain collectively with the governments that employed them, thereby handing political power to employees who were the principal beneficiaries of government spending. Conventionally, Jerry Brown is characterized as liberal, but as governor in 1976, he signed the Uniform Determinate Sentencing Act that converted most sentences to mandatory-minimum periods specified by the state legislature, leading to an explosion of the state’s prison population. Today’s exaggerated convention is that California suffers from exploding employee costs because of domination by a single party. Not true. Both parties enabled and capitulated to public sector unions seeking ever-higher compensation and benefits.

Last year we spent as much time blocking tax increase proposals as liberating nurse practitioners. This year will be the same. Reform efforts will focus on OPEB and tenure but at least as much time will be devoted to blocking tax increases, bills to extend collective bargaining rights to legislative staff, and more.

In 1968, Governor Ronald Reagan signed the Meyers-Milias-Brown Act endowing police and other local personnel with the power to bargain collectively with the governments that employ them, making California only the second state to do so and taking a dangerous step Franklin Roosevelt and labor leader George Meany had long discouraged.

Believe it or not, CA state legislators accept donations from enterprises that collect more than $200 billion per year from the state. E.g., $10 billion is provided to prison staff under contracts authorized by legislators to whom unions representing prison staff make donations, and the state pays billions more to dialysis and other health care corporations that make donations to legislators.

Occasionally some GFCers ask whether the dominance of public employee unions over California politics and policy can ever end. The answer is “yes.” Below is an example of a once-dominant power being dethroned.

Nearly always too soon to tell.

When asked by Henry Kissinger in 1972 for his thoughts on the French Revolution, Chinese Premier Zhou En-Lai reportedly answered that it was “too soon to tell.”* The same may be said about gubernatorial performance in California. For example, who knew in 1968 that the granting of collective bargaining rights to public employees by Ronald Reagan would lead to public employee domination of California’s politics today? Or that Jerry Brown’s support for California’s Determinant Sentencing Law in 1976 would lead to an explosion in California’s prison population decades later?

CA’s governor negotiates compensation with 209,000 employees. This year Governor Brown proposes $19 billion in salaries for them…

Transparency gets a chance.

In 1968 California Governor Ronald Reagan signed legislation granting collective bargaining rights to local and county public employees and enabling confidentiality of collective bargaining negotiations. A decade later Governor Jerry Brown signed legislation extending those rights to K-12, state and higher education employees.

California has undergone a dramatic transformation over the last fifty years but not so the California Republican Party. Today, only 25.9% of Californians are registered as Republicans, down more than eight points of registration in ten years. At this pace, Republicans will soon be the third most popular party registration in California, behind Democratic and No Party Preference. Not a single statewide elected official is Republican and the party is a super-minority in both houses of the legislature. With an unpopular Republican as president and the number of new registrants willing to identify as Republican at record lows, in the absence of change the California Republican Party has lower to go.