Friday, June 8, 2012

Michael Gerson Messes Up On Wisconsin Election Analysis

In the Washington Post today, tendentious moralist Michael Gerson opines that labor unions are driving a wedge into the Democratic Party. He bases this on the Wisconsin recall election, where Governor Walker trounced Milwaukee Mayor Tom Barrett.  He argues that this was all about public sector unions getting too much money into their pension funds and wages, which in a recessionary period conflicts with various progressive spending agendas.  He points to local Dem mayors such as Reed in San Jose, CA, who have pushed for reductions in pensions for local public workers against union wishes and won strongly in referenda supporting their efforts, to excoriate Barrett and call for dismantling collective bargaining for public sector unions.

Now, whatever one thinks of public sector unions, Gerson's account is seriously misleading and lacking in facts on several fronts.  First is that while Barrett certainly became associated with the position of the public sector unions in the final race, as mayor he had done exactly as Reed in San Jose and had angered the public sector unions in Milwaukee for doing so.  They had supported his main rival in the primary, Kathleen Falk of liberal Dane County over him, with this intra-party fight being pointed to by many as one of the reasons for Barrett's loss, along with the blunder of holding the recall election in the summer after students had all gone home, who are more inclined to support the Dems than the GOP.  This is on top of Gerson's conveniently ignoring that many of those voting for Walker apparently did so out of simply disapproving of holding the recall election at all.

The other issue is that he completely ignores the fact that the public sector unions in Wisconsin had completely agreed to virtually all of Walker's financial demands regarding pay and pensions and so on.  This was not about the deficit or other financial matters.  It was all about public sector union-busting, which in fact Gerson does support.  But part of what got so many people angry was that Walker never said anything about this when he was running.  He certainly spoke about limiting public worker pensions and so on, but never whispered a hint about his plan to severely limit collective bargaining.

What is curious is that on the same page, the generally obnoxious Charles Krauthammer got most of this right, although Krauthammer was probably even more gloating and mocking than Gerson regarding the impact of all this on the union movement, which does look pretty severe.

1 comment:

Myrtle Blackwood said...

Hmm...pension funds are major institutional investors. And workers are now being denied even their own privatised pension contributions, paid for out of their steadily-diminishing wage base.

Perhaps it will be the world's central banks that will now be the sole funder of the world's institutional investors. [Because it doesn't look like the money is coming from corporate profits sourced from worker consumption. Nor from the empty coffers of pension funds.] Perhaps the central banks will also provide future corporate profits?

What will be the new evolution in capitalism, I wonder?

"...Money manager capitalism is characterized by the strong influence of institutional investors upon economic decision-making, by increased worker insecurity and rising income inequality, and by a fast pace of financial innovation. The aim of money managers, and the sole criterion by which they are judged, is maximization of the value of investments made by fund holders. Business leaders, therefore, have responded by becoming highly sensitive to short-term profits and the stock-market valuation of their firms. This has led to a wide variety of corporate restructurings, as well as to labor force downsizing, outsourcing, and offshoring, all of which have fueled worker insecurity and income inequality. Money manager capitalism has also fueled financial innovation, especially securitization.26…."

Working Paper No. 724
Post-Keynesian Institutionalism after the Great Recession. by Charles J. Whalen*
May 2012