Today on NBC’s Meet the Press, Governor Scott Walker (R-WI) spoke eloquently (see below) about the ongoing debate over collective bargaining that has halted legislation in Wisconsin and seized the nation’s interest over the past few weeks. Walker, who has resolutely stood firm in his showdown with the Democrats, has proposed legislation that would not only require public unions to bear greater responsibility for certain benefits, but would also end the “right” of collective bargaining for public unions.
In reality there are two major issues at work. The first and most immediate is the budget issue. This has predictably been relatively uncontroversial. As most acknowledge, states across the country are in dire budgetary straits. Accordingly, the Wisconsin public unions have agreed to shoulder the increased responsibility for their fringe benefits.
It is, however, the second issue – namely the proposed abolition of collective bargaining for benefits – that has driven the unions into a fury and their Democratic supporters into Illinois. Democrats have become absolutely apoplectic about the attacks on their supposed rights, effectively shutting down the Wisconsin legislature and moving their foot-soldiers into the capitol building in Madison.
The battle is unsurprising, despite its contemptibility. It is natural to expect unions to defend the unjust handouts and special privileges conferred upon them by the power of the state and to stalwartly fight to prevent their eradication. Nevertheless, it is quite laudable that Governor Walker has had the fortitude to stand-up to the tyranny of collective bargaining and unions.
The argument for such a strong criticism of unions is simple. Unions, like any institution that has coercive power, can – and do – cause severe harm to others that may cross their paths. The unions have been afforded a rare opportunity to wield the coercive power that should only be possessed by governments (and even then in limited fashions). No other institution is granted such sweeping powers of coercion over private individuals. For instance, the automatic and mandatory deduction of union dues from paychecks is simply the power of taxation in private hands.
Furthermore, unions have severe distorting powers. They drive wages up and cause unemployment. A union is essentially a private club, established with explicit government approval, where benefits are unjustly taken from those who are excluded and given to those lucky enough to call themselves members. As Friedrich Hayek argues, the real crushing power of unions is not so much the power they have over their members, but the power they possess over those outside of the union. Not only is this arbitrary and uneconomical, it is blatantly unjust. No organization, whether union or otherwise, should be granted such powers of coercion.
For those union supporters who argue in terms of workers’ protections, their aims are noble yet misguided. Union-busting is about destroying a special interest, not about hurting workers. As Governor Walker argues, Wisconsin workers are comprehensively protected by a multitude of legislation - and rightly so. There is no dispute that workers, like other groups, should have protection from mistreatment. However, unions, due to the inherent harm caused by their coercive power, are simply not the proper forum for maintaining worker protections.
The battle against collective bargaining is a small step in the right direction. Unions should not be afforded any special privileges under the law. They should be allowed to exist like any private organization – free to assist their members in a variety of fashions but stripped of any pseudo-legal power over others. Governor Walker should be applauded for his resilience and justness in attacking a bastion of cronyism and illiberalism.
Showing posts with label special interest. Show all posts
Showing posts with label special interest. Show all posts
Sunday, February 27, 2011
Thursday, January 20, 2011
The Power of Lobbies
It is a common political pastime to disparage so-called “special interests.” Their association with the Big “You Fill in the Blanks” [Business, Insurance, Auto, Pharma, etc.] and their alleged corrupting influences on politics has made them an unremitting target of popular umbrage. Following the Citizens United decision, President Obama distinctively claimed that it was “a major victory for big oil, Wall Street banks, health insurance companies and the other powerful interests that marshal their power every day in Washington to drown out the voices of everyday Americans.” However, a year after this infamous and contentious Supreme Court ruling, there has yet to be considerable, if any, focus on a key aspect of the special interest world.
The overlooked reality is that no lobby or special interest has any power save what is given to it by the government. Merriam-Webster defines a special interest as “a person or group seeking to influence legislative or government policy to further often narrowly defined interests.” Special interests gain clout not through their own power over a specific industry or market, but by influencing legislators or regulators to grant them undue sway. The real power lays with the government officials, who possess the ultimate command of coercion.
Surprisingly, this fact is frequently disregarded when populists want to attack special interests. However, if one takes a look at the industries where powerful lobbies exist there is an eerie correlation with government involvement. Seemingly, special interests would lose much of their influence if the government ceased arbitrarily meddling in private markets.
To be clear, this is not a claim that the problem of every special interest is rooted in government. For instance, simple vote- or seat-buying [Mr. Blagojevich] is often initiated by special interests and is unquestionably and inarguably wrong. There is little controversy that such behavior is unconscionable and must be eradicated. This is, of course, not a flaw in government as an institution but in government officials as corrupt individuals.
Nor is it a claim that government can have no constructive role in the private sector. Certain regulations and oversight are, at times, necessary. For instance, when non-legislatively caused monopolies exist and they are able, through illegal or unjust means, to deter competition (or in other words, cause severe distortions of the market) the government may have a limited role to play in deconstructing the firm’s market power.
Nevertheless, far too many of the problems (and there are many problems) in the private sector are the result of a conferral of power from the government to an undeserving group or individual. Critics miss the point when attacking lobbies, who like any other group or individual, are solely aiming to maximize their self-interest. Instead, the vitriol should be directed towards the regulators and politicians who continue to write laws and regulations that arbitrarily interfere in a world where the government does not belong. [To parallel, who is at fault when a demanding child is given one-too-many sweets– the relenting parent (who ultimately has the power) or the whining kid?]
Our government and our society need to change their outlook in this regard. If industries know that government will stand at arm’s length from the daily hubbub of a market and instead, solely create guiding rules (I.e. enforcement of contracts, prevent of abuse or fraud, etc.), the power of special interests will be severely limited if not eradicated. However, this is unfortunately not the case. Far too often, a tweak in a law can make or break a company’s bottom line. Right or wrong, this necessitates a strong response from an industry.
Republicans have a grand opportunity (and some say a mandate) to make this cultural shift. While so-far largely symbolic, the “repeal and replace” campaign against Obamacare is a prime testing ground. Regardless of whether the “replace” makes it anywhere in the next two years, it should be fundamentally based on the principle of clear, concise rules, that strengthen market forces and avoid noisome government meddling. Avoiding unwarranted special interest power is as simple as prohibiting unjustifiable government forays into the private sector.
The overlooked reality is that no lobby or special interest has any power save what is given to it by the government. Merriam-Webster defines a special interest as “a person or group seeking to influence legislative or government policy to further often narrowly defined interests.” Special interests gain clout not through their own power over a specific industry or market, but by influencing legislators or regulators to grant them undue sway. The real power lays with the government officials, who possess the ultimate command of coercion.
Surprisingly, this fact is frequently disregarded when populists want to attack special interests. However, if one takes a look at the industries where powerful lobbies exist there is an eerie correlation with government involvement. Seemingly, special interests would lose much of their influence if the government ceased arbitrarily meddling in private markets.
To be clear, this is not a claim that the problem of every special interest is rooted in government. For instance, simple vote- or seat-buying [Mr. Blagojevich] is often initiated by special interests and is unquestionably and inarguably wrong. There is little controversy that such behavior is unconscionable and must be eradicated. This is, of course, not a flaw in government as an institution but in government officials as corrupt individuals.
Nor is it a claim that government can have no constructive role in the private sector. Certain regulations and oversight are, at times, necessary. For instance, when non-legislatively caused monopolies exist and they are able, through illegal or unjust means, to deter competition (or in other words, cause severe distortions of the market) the government may have a limited role to play in deconstructing the firm’s market power.
Nevertheless, far too many of the problems (and there are many problems) in the private sector are the result of a conferral of power from the government to an undeserving group or individual. Critics miss the point when attacking lobbies, who like any other group or individual, are solely aiming to maximize their self-interest. Instead, the vitriol should be directed towards the regulators and politicians who continue to write laws and regulations that arbitrarily interfere in a world where the government does not belong. [To parallel, who is at fault when a demanding child is given one-too-many sweets– the relenting parent (who ultimately has the power) or the whining kid?]
Our government and our society need to change their outlook in this regard. If industries know that government will stand at arm’s length from the daily hubbub of a market and instead, solely create guiding rules (I.e. enforcement of contracts, prevent of abuse or fraud, etc.), the power of special interests will be severely limited if not eradicated. However, this is unfortunately not the case. Far too often, a tweak in a law can make or break a company’s bottom line. Right or wrong, this necessitates a strong response from an industry.
Republicans have a grand opportunity (and some say a mandate) to make this cultural shift. While so-far largely symbolic, the “repeal and replace” campaign against Obamacare is a prime testing ground. Regardless of whether the “replace” makes it anywhere in the next two years, it should be fundamentally based on the principle of clear, concise rules, that strengthen market forces and avoid noisome government meddling. Avoiding unwarranted special interest power is as simple as prohibiting unjustifiable government forays into the private sector.
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