Pension reform was already on the table here in California
before the Wisconsin public employee union protests, but now in the glare of
the national spotlight pension reform could become a major focus of the budget
debate. Governor Jerry Brown said he wants to look at public pension reform, but
he does not want to tie it to the tax extensions and weigh down the ballot. He
may no longer have a choice.
The Wisconsin standoff – with minority Democratic
legislators refusing to step inside state borders and create a quorum so that
the majority Republicans can pass the reform bill – represents a budget battle over
public employee benefits that will occur in many states across the country.
State budgets are being squeezed, unemployment is steady, services provided by
government are being slashed, and reductions in government employee benefits
will have to be part of the solution.
Brown’s goal of extending taxes will have little chance of
making the ballot unless tempered with other long-term reforms. Simply
balancing the tax extensions against spending cuts is not enough. Especially,
since the tax extensions will be mandated for five years under Brown’s plan,
while the cuts could be altered statutorily at any time.
Beyond the debate over public sector benefits, it would seem
the contentious piece of Wisconsin Governor Scott Walker’s plan – reducing or
eliminating collective bargaining for government unions — won’t even make it
on the negotiating table in Sacramento. Certainly, Governor Brown won’t
entertain such a measure. Not only was he the chief executive who signed into
law collective bargaining in his first turn as governor, but also he has a
strong relationship with the unions who greatly funded his campaign.
However, in California there is another way to change the
law besides relying on the governor and legislature.
Ironically, a week before the Wisconsin protests over
eliminating collective bargaining made national news, the Santa Barbara News Press headlined
a story about a UC Santa Barbara economics professor announcing he would pursue
an initiative to end collective bargaining. Professor Lanny Ebenstein, who also
heads the Santa Barbara Taxpayers Association
and the California
Center for Public Policy, said if collective bargaining was ended, "we
could cut taxes in the state and increase services. And that’s what California
should do."
Whether the groups Ebenstein represents have the ability to
qualify a measure for the ballot remains to be seen. You can read more about
Ebenstien’s effort here.
Another feature of Governor’s Walker’s proposal
that is similar to previous California efforts and, therefore, more likely to
make an appearance here is to stop governments from automatically deducting
political dues from union members paychecks. "Ending dues deductions breaks the political cycle in which
government collects dues, gives them to the unions, who then use the dues to
back their favorite candidates and also lobby for bigger government and more
pay and benefits," Labor historian Fred Siegel told Wall Street Journal
columnist John Fund in discussing
the Wisconsin situation.
Often
called paycheck protection for union members, similar measures on the
California ballot were defeated in close elections in 1998 and 2005. There is
talk that another paycheck protection measure would be filed for the 2012
election cycle.
California is not Wisconsin with the governorship and
legislative majority held by Democrats in California and Republicans in Wisconsin. Still, the issues that are
boiling over in Wisconsin and affecting other states, could challenge the
status quo in California because of the budget deficit.