It has become clear in recent months that the model of ever growing spending, regulation and social welfare programs is unsustainable.
The recent economic recession has only escalated this reality and brought it to the forefront. States such as California, with a mind-boggling 21.3 billion-dollar budget deficit, are on the verge of bankruptcy.
Despite this grim forecast, however, there are some elected officials who are willing to take on the entrenched powers that be in order to address the heart of the problem. One such leader on the national scene is the “honest and refreshing” governor of New Jersey, Chris Christie.
Christie, after vetoing a tax-hike on the wealthy, responded to his critics by declaring, “New Jersey does not have a tax problem, that we don’t have enough tax revenue. We have a spending and size of government problem, and we need to start saying “no.” And, today is another one of those examples of saying no.”
With his blunt and almost Churchill-esque stance against taxes and spending, he has been on a one man mission to face down what he calls the “mindless, faceless union leaders” in order to establish some fiscal order in his home state.
That is at the center of these massive state budget deficits – the unaffordable state workers and the negative effects of public sector unionization.
Due to the political influence and protection of public unions, whose members vote at a 40% higher rate than the average citizen, it is the private sector that bears the brunt of bad economic times.
Since the beginning of the recession in December of 2007, the private sector has seen a loss of over 8 million jobs. Conversely, the public sector has had a net gain of around 100 thousand.
According to Forbes reporter Stephane Fitch, “In public-sector America things just get better and better. The common presumption is that public servants forgo high wages in exchange for safe jobs and benefits. The reality is they get all three. State and local government workers get paid an average of $25.30 an hour, which is 33% higher than the private sector’s $19, according to Bureau of Labor Statistics data. Throw in pensions and other benefits and the gap widens to 42%.”
The inflated scope of government has required more and more of these expensive public employees with their defined benefit plans that we can no longer afford. They have become an overbearing leech on the more productive and wealth producing private sector.
Fortunately there are several reforms other than mere temporary budget cuts that can be used to scale back the cost and influence of public sector unions.
One such reform would be a mechanism to allow citizens to challenge public sector collective bargaining agreements in court, according to Professor Richard Epstein in a 2009 CATO Institute policy analysis.
A few other reforms suggested in the analysis would be to repeal laws that legalize strikes as well as requiring public unions to pay for the cost of their dues rather than requiring the tax payer to foot the bill.
Whether these sorts of reforms are passed or whether there are simple spending cuts remains to be seen.
What cannot happen is a continuation of the status quo. Something must be done, because the ship of state can no longer afford to continue on this unsustainable course.
We can only hope for more leaders around the country to take note of Christie, put their petty self-interest aside for once and stand on principle rather than swaying with the political wind.