Making sense of Wisconsin’s union showdown

Adirty little secret about column writers is that we each have a handful of road-tested templates that we use all too frequently to make sense of something that has happened and demands our wise opinionation. These past few days I’ve been rummaging around in my stash for just the right template to apply to the showdown between the Republican governor and public-sector unions now playing out in Wisconsin.

One old trick is to suggest a thought experiment that asks readers to consider the mirror image of what is going on. In this case, you’d be asked what the reaction would be from Republicans and business interests if a newly elected Democratic governor and legislature proposed to deal with a budget deficit by first raising unemployment benefits and then pushing through a big corporate tax increase for all but the Democratic-leaning tech sector. For good measure, the package would also contain a ban on corporations making political donations without getting the permission of each shareholder, lest they use their power to repeal the tax increase and push the budget out of balance.

This is analogous, of course, to what Gov. Scott Walker has proposed for dealing with Wisconsin’s budget gap: the tax breaks for businesses, the benefit cuts for all state employees except Republican-leaning police and firefighters, the automatic decertification of all public-sector unions and the stripping of their right to bargain anything but wages. Looking at Walker’s reflection in the political fun-house mirror makes it abundantly clear that the governor has a more ambitious agenda than merely closing a modest budget gap.

Another useful template is the double-reverse historical analogy. The last time any elected leader made such a direct and brazen attack on the legitimacy of the union movement was when Ronald Reagan risked havoc in the skies by firing hundreds of striking air-traffic controllers and preventing them from ever getting their jobs back. This dramatic bit of union-busting became a turning point from which organized labor never really recovered — and, like the Wisconsin imbroglio, skillfully played off resentment of public employees whose pay and benefits exceed that of the average taxpayer.

But rather than playing Reagan to Wisconsin’s truant teachers, Walker overreached, refusing to give up his union-busting even after the unions agreed to his benefit-cutting demands. Now that he has allowed the unions to reframe the issue from one of greedy public servants to one of political revenge, Walker has single-handedly succeeded in bringing more attention, unity and sympathy to the union movement than it has had since . . . well, since Ronald Reagan took on the control tower. A mischievous columnist might even take this opportunity to speculate whether this is the beginning of the revival of labor’s fortunes.

Back when I was working at Inc. magazine in the mid-1980s, we loved nothing better when approaching a public-sector issue than to ask how the private sector would handle it. Faced with the situation in Wisconsin, we would have called up Tom Peters or Peter Drucker and posed the example of a new chief executive brought in by the shareholders (i.e., the voters) to rescue a company suffering from operating losses (budget deficit) and declining sales (jobs). Invariably, they would have recommended sitting down with employees, explaining the short-and long-term economic challenges and working with them to improve productivity and product quality in a way that benefits both shareholders and employees.

Now compare that with how Wisconsin’s new chief executive handled the situation: Impose an across-the-board pay cut and tell employees neither they nor their representative will ever again have a say in how things will be run or get a pay raise in excess of inflation. A great way to start things off with the staff, don’t you think? Remember that the next time you hear some Republican bellyaching at the Rotary lunch about why government should be run more like a business.

Regular readers of this column are no doubt familiar with my favorite gambit, which is to spy the common thread in several of the day’s seemingly disparate events — the “it’s really all one story” ploy. Using this approach, the political badgering in the Badger State is no different from the budget crises in Ohio, New York and California and the looming shutdown of the federal government in Washington. All of them are manifestations of the meta-reality of a country that for years had been living beyond its means. Now, even three years after reality came crashing down, we have only just begun to figure out how to bring about the reduction in living standards that will be necessary to create a sustainable balance. Will the pain come in the form of prolonged high unemployment? Or wage and salary cuts? Or reduction in the value of homes and financial assets? Or loss of ownership of American companies? Or price inflation? Or higher taxes? Or reductions in government services and benefits?

The right answer, of course, is “all of the above.” The hole we dug for ourselves was so deep and so wide that we’ll need all of them to get us out of it. The central political, economic and social challenge of the next decade will be to decide how we are going to apportion the adjustment among these various channels, and among the various classes and sectors and regions of the country, without tanking the economy or breaking the bonds that hold our society and our democracy together.

That’s the sort of seemingly profound and sweeping observation that columnists love to save to provide a dramatic ending, not unlike the timpani-and-brass crescendo at the conclusion of a Beethoven symphony. The columnist’s hope is that, in the rhetorical afterglow, the reader will never notice that the column never managed to offer a realistic prescription or even a clue as to what might happen next.

pearlstein@washpost.com

Steven Pearlstein is a business and economics columnist who writes about local, national and international topics.
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