Democrats and Union Payoffs

There is a disturbing trend in the actions of the Obama administration when it comes to how they spend the money. There are many different examples which will highlight the trend.

First, the automobile industry bailout: Money was given to General Motors and Chrysler instead of allowing the companies to reorganize under a Chapter 11 bankruptcy. Therefore, public money was taken from auto workers in the south whose average salary is about forty three dollars an hour and given to United Auto Workers members in Michigan whose average salary is about seventy one dollars an hour. The Obama administration portrayed the action as helping the General Motors and Chrysler corporations. In fact, a chapter 11 bankruptcy would have been much more advantageous as it would have allowed renegotiation of the labor contracts and would have relieved the pressure of legacy costs to the companies. In addition, secured creditors received something like twenty seven cents on the dollar while the UAW was given a major stake in General Motors despite having no guaranteed investment. The money was really a bail out of the United Auto Workers, not the companies. It hasn’t worked and the two companies have shown no signs of changing fortunes, despite the Cash for Clunkers program.

Second, the school voucher program in Washington, DC: The voucher program in Washington, DC cost about $7600 per student. The schools at which the voucher students attended had 90% higher scores in language tests and 95% higher scores in mathematics testing. The interesting paradox is that the Washington, DC public school system spends about $13,000 per student. The omnibus spending bill removed funding for the school voucher program. The Democrats, in their infinite concern for children, cancelled a program which cost taxpayers half as much and resulted in markedly better school performance. Why would they do that? The answer is easy. The teachers union has been paid off for supporting Democratic candidates in the election. The Democrats are willing to screw over poor children and their families in order to pay off the union.

Third, the stimulus construction projects: The stimulus bill passed by the Democratic Congress and the Obama administration has a provision that stipulates that stimulus construction projects have to pay union wages to workers on stimulus projects. Why would that provision be in the bill? After all, it would result in less money to do projects and the ones that are completed would cost more. The reason is easy. Governments don’t build roads and bridges, private contractors do. Those contracts are awarded by bid. A non-union company can submit a lower labor cost bid than a union company. The raw materials cost will be the same. Therefore, the non-union bid will generally be lower. This provision in the bill is expressly for the benefit of union contractors to receive stimulus money contracts for infrastructure. The unions will receive money but the taxpayers will get less infrastructure projects completed for their money.

Fourth, the “Employee Free Choice Act”: This piece of legislation is close to criminal. The rules would change and take away the right of workers to a secret union election ballot. To organize a union, all that organizers would need is 51% of employees to sign a card and the union would be installed. The cards would be public and the period of time to have them signed in unlimited. This is like the mob in Chicago in the 1930s. Union thugs intimidating workers is not progress. The intimidation may not even be the worst part of the bill. In the event of non-resolution of a union contract, after a set period of time the federal government will set wages. Hmmm… with the Democrats in power, I wonder whose side would be favored? Therefore, people who are intimidated into a union will have their wages set by the federal government. This is an economic disaster of the highest magnitude just waiting to happen. It will lead to companies closing because they are no longer profitable and revival of the union thugs who have essentially gone away due to people’s reluctance to embrace unions.

Fifth, in the proposed health care legislation, groups are given advantages when purchasing health care policies. Which groups? Groups of organized employees. Hmmm… who could that be? Unions, of course. Additionally, Democrats are trying to protect the substantial health care plans in place for union contracts.

There are more examples but the point should be clear by now. In all examples, it is easy to see the pay off to the various unions by the Democratic Congress and the Obama administration. It is brazen and open. It is also going to massively harm the United States economy and prevent recovery. A recent poll which asked people if they desired to have their jobs converted to union jobs had only 9% say yes and a resounding 83% say no. This is the Democratic version of the organized crime “protection” rackets and is disgusting.