The Wisconsin budget battle is really not about today or tomorrow but the day after tomorrow; it is far less about helping the state make up for a projected $137 million budget deficit than it is about changing the role that public unions play.
This budget shortfall was not unexpected. Indeed, Wisconsin's Republican governor, Scott Walker, has pushed for policies that, in the short term at least, have exacerbated the state's deficit. Walker and the Republican-controlled Wisconsin state legislature passed in January $117 million (over the next two and a half years) in tax breaks for businesses and health savings accounts. Part of the budge deficit is really the story of transferring some state subsidies from public employees to private businesses. That transference may be good or it may be bad, but it is a key detail of this battle.
Moreover, it seems as though union leaders are open to accepting Walker's demands that members contribute 5.8% of their incomes towards their public pensions and and at least 12.6% of their incomes towards health-care plans. This increased contribution would be a de facto pay cut for union members (for example, University of Wisconsin union members could see a 8-15% pay cut). Union leaders have suggested that they would be willing to make these concessions. If this battle were just about the upcoming deficit, it would be over.
But it isn't. There's one concession that unions are not willing to make: surrender their collective bargaining power. Walker's proposal would deny most unions the ability to collectively bargain for anything more than salary (and even that would be limited); Walker's proposal excepts from these collective bargaining rules his political allies in the police and firefighters unions. His proposal also puts up additional hurdles for unions to maintain their union status. These measures set the stage for a long-term structural change.
Consider education. The elimination of union collective bargaining could open the door for destroying tenure, limitations on teaching load, pay for extracurricular activities, limits on working hours, and state funding for continuing the education of teachers. The end of collective bargaining could also help undermine public employee pension funds.
Scott Walker has borrowed a page from Barack Obama and Rahm Emanuel and is not letting a crisis go to waste. As with Obama, the most contentious part of Walker's proposals (collective bargaining) serves a far more structural purpose than a short-term one.
(A couple other structural notes: At a time when private sector employment is stagnating and wages shrinking, public workers are not going to be able to defend ever-increasing wages and benefits for themselves. Also, many public unions made the choice to full-throatedly back Democrats, which has limited their leverage over Republicans. With Republicans newly empowered in state legislatures across the country, the hands of public unions are significantly weakened. These unions could be paying a price for their partisanship.)
