"Union Busting, Massachusetts Style"

 SOURCE

Pop quiz: What political party, in what state, this week passed a bill in the dead of night stripping public-sector unions of their collective- bargaining powers? Republicans in Wisconsin? The GOP in Ohio or Indiana?

Try Democrats in Massachusetts. Maybe the debate over public-sector benefits isn't all that ideological after all.

That would be the view of Massachusetts Democratic Speaker Robert A. DeLeo, who late Tuesday led an overwhelming majority of his House in passing a bill divesting policemen, firefighters, teachers and other municipal employees of the power to collectively bargain most health-care benefits. The 111-42 vote took place at 11:30 at night, so as to avoid a mass of protesting union workers set to descend on the State House the next day. The cheek.

Then again, Mr. DeLeo (like so many Republicans) seems to understand that there is no longer a choice. The Bay State—precisely because it is the land of union power—is being crushed by its rich public-worker pay and benefits. Its several hundred thousand municipal employees have long had the power to collectively bargain key aspects of their health care—co-pays, deductibles, premiums.

Municipal health costs have as a result averaged near 11% growth annually—for a decade. The average premium is today 37% higher than in the private sector, and one-third higher than premiums for federal plans. The numbers have so exploded that personnel costs—salaries and benefits—are now eating up an astonishing 75% of local Massachusetts budgets.

That's a tipping point that threatens widespread layoffs and the end of basic services. "The huge growth in municipal health-care costs is cannibalizing everything else," Michael Widmer, president of the Massachusetts Taxpayer Foundation, tells me. Mr. DeLeo and "other members of the legislature understand that what is at stake is their local schools and hometowns." The unions, in short, have walked Massachusetts so far into a hole that even Democrats can no longer ignore the problem.

The DeLeo bill is a big political event (a "wow" moment, says Mr. Widmer), and it will save cities and towns an estimated $100 million in the upcoming budget year alone. Public employees would have 30 days to discuss health-plan changes with local officials, but at the end of that period officials can set co-pays and deductibles. In a concession, the bill allows local unions to retain bargaining power over their share of premiums, which is more power than what is currently allowed state employees.

Not that this has mollified labor. Robert J. Haynes, president of the Massachusetts AFL-CIO, was so irked he forgot to stick to the union script about "rights" and a "war" on the "middle class." He skipped to the real outrage—that the 81 Democrats who voted for the bill were failing to play by the political rules. "These are the same Democrats that all these labor unions elected. The same Democrats who we contributed to in their campaigns," he complained. The unions would fight this to the "bitter end," he vowed. "Massachusetts is not the place that takes collective bargaining away from public employees."

Or maybe it is. Even as the press has obsessed about Wisconsin, Massachusetts—hitting a fiscal wall—has moved quietly on the union front. As early as 2009, Democratic Gov. Deval Patrick signed a transportation bill that stripped bargaining power from public workers for the Massachusetts Bay Transportation Authority (MBTA) by moving them into the state health-insurance system.

The MBTA had been dishing out crazy benefits to its 12,000 workers and retirees, paying an astounding two-thirds more in health-care costs per employee than those paid for state workers. (Only last week, Superior Court Judge Linda Giles tossed out the union lawsuit protesting the switch.) Facing an unfunded pension liability of some $20 billion, Gov. Patrick has also been pushing modest state pension reform. It's a measure of the dire mess in other blue states that Democratic governors in New York (Andrew Cuomo) and California (Jerry Brown) have also dared murmur "pension reform."

Mr. DeLeo isn't backing down. Supported by an array of business and education groups, he applauded those who voted to allow cities and towns "to retain jobs and allot more funding to necessary services." Still, the bill is no sure thing. It now moves to the Senate, where Democratic President Therese Murray has shown no similar backbone. And while Gov. Patrick applauded the House for taking an "important vote," he won't say whether he'd sign it. He's more focused on running from Gov. Scott Walker. "This is not Wisconsin," he insisted. "That's not what the House did."

Wrong. Wisconsin moved to rein in collective bargaining powers that are crushing the state. Massachusetts moved to rein in collective bargaining powers that are crushing the state. The only difference is that Democrats have chosen to portray Mr. Walker's legislation as "union-busting" while presenting their own as necessary reform.

The public, and the press, should take them at their word that it's the latter. The DeLeo bill is a game-changer. It's big, concrete proof that public-employee benefit reform isn't a political game. It's a modern, fiscal necessity, the only thing standing between a state and budget ruin. Just ask Massachusetts Democrats.