Issue 2 & the Attack on Ohio's Middle Class

Issue 2 & the Attack on Ohio's Middle Class is a post about why Issue 2 matters.

Ohio’s government employee unions think that Issue 2 is outrageous. They feel that it represents an extreme view, that it denies them their rights, and mostly, that it puts Ohio’s middle class at risk. 

These are serious charges, and they certainly merit closer scrutiny. So before deciding how I felt about Issue 2, I did a couple of things. 

First I researched public records to help understand the status quo. 

Then I read the bill. 

There’s a lot of history behind Issue 2, and the bill is 300 mind-numbing pages long. It addresses much more than we can discuss here. So instead, I’d like to focus on those parts of the bill that seem to concern people the most, and then explain what I think.

For instance, union officials claim that Issue 2 is extreme and out of the norm because Issue 2 allows unions to bargain collectively only on matters related to wages, hours of work and other terms and conditions of employment. (They can no longer bargain on things like the number & order of employee layoffs, class sizes, job outsourcing or equipment, other than equipment related to life safety.)

However, according to the US Government’s Congressional Research Service only 23 other states currently have laws that allow unrestricted collective bargaining for government workers. Another 14 states allow only limited collective bargaining for government employees. And 12 states expressly do not allow any level of collective bargaining in the public sector. So if Issue 2 makes Ohio extreme and out of step, then so are more than half the states in the nation. As for consensus about what’s  “the norm,” it’s interesting to note that private sector unions once objected to public employee unions. The AFL-CIO’s official statement on public unions was once “in terms of accepted collective bargaining procedures, government workers have no right beyond the authority to petition Congress – a right available to every citizen.”

Union officials also claim that Issue 2 denies public sector workers their rights. In particular they cite the provision barring public sector workers from striking. But in Ohio, police and fire fighters are already prohibited from striking. In neighboring states like West Virginia, where there is also a strong union presence, all public employees have been prohibited from striking for quite some time. And for more than 30 years, federal law has barred a variety of US government employees from striking. In none of these instances has the result been a shortage of qualified individuals willing to work in government. Time and again anti-strike contract clauses have been upheld in the courts, because they are not a violation of anyone’s civil rights. Teachers and other municipal workers have said that they are just as crucial to our society as police and fire fighters. If that’s the case, then it’s reasonable to expect them to adhere to the same collective bargaining rules.   

Then there is the matter of Ohio’s middle class.

Union officials claim that Issue 2 is an attack on the middle class, that it puts citizens at risk, and that it will lower our standard of living.

But in Ohio, public sector union members make up only 6.5% of the roughly 5.5 million workers in Ohio. Unless the other 93.5% of Ohioans is made up entirely of either the very rich or the very poor, I don’t think that government union workers have an exclusive claim on middle class status.

Which leads me to what I think matters most.

Somewhere in this debate about Issue 2 we need to understand that ultimately it is Ohio’s middle class taxpayers who foot the bill for government workers’ compensation packages. And while I think it safe to say that the vast majority of citizens want to see teachers, police, fire fighters and other city, county and state workers make a good living, they don’t want to write a blank check. What’s more, they can’t. The money just isn’t there. Voters are already facing higher costs for food, fuel, utilities and other basic necessities. Many voters have themselves had to deal with pay cuts, layoffs and furloughs. They’re not in the mood to pay more for government. (Consider how difficult it is to pass a school levy or approve a bond to build a fire station.)

Nationwide, city and state governments are in financial crisis. It’s important to realize that employee compensation makes up to 80% of a government entity’s operating costs. Estimates of the un-funded pension liability for Ohio’s public unions range from $20 billion to more than $100 billion, (the lower estimates assume that pension funds will earn 8% annually on current investments). Voters may say no to Issue 2, but that doesn’t mean that they’re going to say yes to higher property taxes, a higher state income tax or more sales taxes to bail out somebody else’s retirement fund. And, if Issue 2 fails, they’re not going to want to layoff paramedics, shut senior centers, cut recreation programs, reduce snow plowing or eliminate rubbish collection to meet the future demands of government workers’ unions.

The current system of compensating government employees in Ohio is no longer sustainable. It got this way because unions have had a monopoly on large segments of government work, and almost a free hand spending taxpayer dollars. Probably the most important thing that Issue 2 does is to take the resolution of contract negotiations and disputes out of the hands of third party hired arbitrators, and place that responsibility in the hands of elected officials who answer to voters. It also requires, for the first time, that contract negotiations will have to take into consideration the finances of the local community, and if officials want to make a deal that will require more funds than a city or school system has, without passing another levy, then the voters will have to approve that contract.

These are good things for taxpayers, and they're not necessarily bad things for public sector workers. If Issue 2 passes, communities like Brecksville and Broadview Heights are still going to want good employees, and competition amongst those communities will make them pay good wages and provide good benefits in order to attract and retain talented, dedicated workers. If they don't, those employees will vote with their feet. As many school systems and cities have already learned, payroll costs that cannot be supported by tax revenues actually cause layoffs and cutbacks in services. The best way to keep police, fire fighters and teachers working is to make certain that communities can afford to hire them. In places like Wisconsin, where government worker compensation programs have already been adjusted to align with tax revenues, government jobs are actually being added.  

Issue 2 is a serious attempt to keep government debt from driving us all over a cliff. If Issue 2 fails, unions may feel that they won the battle, but they may have also lost the war. In fact they may find that what they really did was kill the goose that laid the golden egg.

Let’s hope that doesn’t happen.

This post is contributed by a community member. The views expressed in this blog are those of the author and do not necessarily reflect those of Patch Media Corporation. Everyone is welcome to submit a post to Patch. If you'd like to post a blog, go here to get started.

william October 30, 2011 at 01:34 PM
it is not common practice in public contracts to have part of the pension picked up. it is around 5%. also this was done to help the city. if your city has this, call the mayor and ask him why it was done, you might learn something.
peter lucas October 30, 2011 at 03:03 PM
Jeff is ignorant of the retirement and benefits of public employees. Again he is basing his opinions on emotionalism. Public employees pay their share toward their retirement system and benefits just as most in the private sector. They also recieve annual employee evaluations just as in the private sector however they cannot recieve unlimited raises and bonuses as they do in private sector where the "customer" has no say in the amount of pay, compenstation or benefits. In the private sector there is no input from the customers or public. Yet they are the ones paying for their benefits and compensation. What I do not understand about conservatives is why they lack the ability to understand that in the private sector they are also paying for the pay, benefits, compensation, retirement etc.... only it's not called tax but the cost of the product. Why don't they raise as large a "stink" when insurance rates go up, costs of goods and services rise so that corporations, CEO's and the shareholders maintain and grow their wealth while the poor and middle class are drained.
David Albert October 31, 2011 at 07:17 PM
Peter, "customers" are not required to purchase a product. The "customer" can say: no I don't want to pay for your insurance and keep their money. Taxpayers don't have that luxury. If we say no! Then we go to jail. There is a massive difference between the "customer" and the "taxpayer".
lissa bailey October 31, 2011 at 07:26 PM
Here's one of the reasons why many hard working middle class taxpayers are so frustrated: http://www.buckeyeinstitute.org/uploads/files/BUCKEYE_public_employee_millionaires_FINAL-1.pdf
BigSkeptic November 02, 2011 at 12:34 PM
Trumka reveals unions are about Progressive agendas; not wages. http://youtu.be/I097Y2uxoFc
Jim November 03, 2011 at 01:17 AM
The only D you are thinking about is D for Democrat. Face it there are other points of view besides I am Democrat hear me blather.
Jim November 03, 2011 at 01:22 AM
Dude, you are not the middle class as clearly described in the article. I am the middle class along with with the other 93% of Ohio residents who are tired of making family sacrifices to fund your early retirements and health care. And don't get me started on how most public employees are sucking up retirement funds while double dipping by taking tax payer funds as consultants.
Jim November 03, 2011 at 01:26 AM
Here's the rub, you elect your own bosses then negotiate with them (wink, wink) to get the upper hand in contracts in exchange for future votes. I say take your case to the public and convince them that they should elect governor _____ because your pay and retirement is not proper for the service you provide. If it is compelling, then governor _____ will prevail.
Dave D November 03, 2011 at 02:01 AM
Well, sorry to burst the bubble, but polls now show issue 2 will be defeated. ( a no vote) Listening to NPR today, the repeal crowd has raised over 31 million dollars compared to 8 million from the other side. A big chunk of this change has come from unions out of state. It was easy to put a "vote no" sign in your yard because it was so politically correct. We've been deluged with ads with firemen in front of burning homes, and police officers overseeing a crime spree. This, of course, being the result of passing issue 2. We have only two alternatives, raise taxes to keep funding wages and benefits of union government employees, or layoffs to balance the budget. We did have an alternative, vote yes on issue 2, but polls now show a 25% margin for no. Has anyone noticed it is really unusual to see a vote yes on 2 sign in front of a residential home? It would be like the scarlet letter on your lawn.
al November 03, 2011 at 02:21 PM
I cannot vote yes on an issue that Kasich and his fellow cronies in the Ohio house excepted themselves from. I do not even want to start on him redistributing stealing money that has always been earmarked for schools and cities from our ohio state taxes thus forcing layoffs and operating levies to almost every community and school system For starters Kasich gave himself a $10,000 a year raise. More examples of Kasich’s wasteful spending are as follows: Under Ted Strickland, the Communications Director (Keith Dailey) has a salary of $89,003. Under Kasich, the same position (Scott Milburn) will make $120,000. Strickland's Press Secretary Amanda Wurst makes $69,992, and Kasich's will get $90,000. Strickland's Chief of Staff John Haseley makes $122,990. Under the proposal, Kasich's Beth Hansen will make $170,000. But it gets worse. Not only is Kasich bumping up the pay of existing positions, he's also creating brand new positions to make sure that his buddies are taken care of. For example, he created the position of Special Assistant to the Governor with a salary of $145,000 per year for his long-time friend, Jai Chabria. This does not take in account his retirement for life and premium free medical plan for life him and his wife will enjoy. It’s the middle class that will suffer from his follies. Anyone who does not support, crosses or disagrees with Kasich will pay the price…… until the recall vote.
Dave D November 03, 2011 at 10:29 PM
Geez Al, are you kidding with this argument? 1. Kasich and his cronies DID NOT EXCLUDE ecludes themselves from this bill because, they are ELECTED OFFICIALS. They can not bargain or strike, and if we don't like the job they do, we can FIRE them. If you don't like the job a patrolman, fireman or teacher does, you can complain, but guess what, THEY WILL NEVER GET FIRED unless they commit some felony. 2. Strickland did the same thing when he got in to office. He hired his "cronies" as you call them and gave them more than the previous administration. Oh yea, and guess what, Strickland has the same retirement for life and medical plan. The difference between Kasich and Strickland is, Kasich took ACTION TO STOP THE BLEEDING. The only bleeding Strickland was trying to stop was the scandals he had in the first year from hiring many incompetent, tax evading criminals that had to be replaced. You spent a lot of time and effort looking up salaries and comparisons, but forgot substance.
Crazy Cynthea November 04, 2011 at 03:48 AM
"If you don't like the job a patrolman, fireman or teacher does, you can complain, but guess what, THEY WILL NEVER GET FIRED unless they commit some felony." This is absolute rubbish - public sector workers can get fired for simply performing poorly. Every firefighter in the state has to perform to a set of very high standards or they get fired. I've seen it myself many times. What is true Dave is that "you" cant fire them - thats because you have no business doing such a thing. Because you don't know anything about that business. What you can do is shut your pie whole and admit defeat. The fact that this bill only applies to union people is a good example of how it is flawed. You say kasich is not subject to it because he and his staff are not union. Who cares - if we're out of money - we're out of money. He and his staff are public employees and it is disgusting that they took a raise in this climate. KASICH IS A DIRTY BUM AND ISSUE 2 IS A FARCE.
Dave D November 04, 2011 at 04:18 AM
Wow, Crazy Cynthea, thanks for proving my point. Is this a joke?
Harry H. November 04, 2011 at 11:33 AM
really Dave? I don't like the job the governor is doing, can I fire him? Yeah, in four years after he has left a wake of destruction in his path. Which is a large part of the point. Elected officials will be given ALL the power. That is never good! They can do a lot of damage over the time they have before you can fire them. Don't trust the teachers and firemen and their unions? If only we had a neutral third party that could examine both sides and make a fair decision so that neither side has too much power! Hmmm, like the system we have now, the one issue 2 wants to destroy. Thank you hurricane Kasich.
Dave D November 04, 2011 at 12:53 PM
Yet another personal attack on Kasich. Issue 2 is NOT about teachers, police, fireman, and other public servants job performance. It is about the stranglehold the public unions have on our budget. Job performance, for the most part is subjective. There will never be a politician with a 100% job approval. Jesus Christ could be elected governor, and at least 30-40% of people would disapprove of his job performance. That is the nature of politics. From what I could see, Kasich did what he thought he had to do, to try and get his budget under control. He knew that his cuts were going to put pressure on local governments, hence the provisions in SB5 that everyone is fighting about. Kasich and the republican controlled state legislature got into power because of the poor job approval ratings of the past administration and legislature. I dont know of any other we Orr in the economy, that allows it's employees to retire at 100% of current pay, let's them come back to works and build up big lump sum payments on top of it all. We the taxpayers can no longer afford this. GM and Chyrsler went bankrupt because of a retirement benefit system that was no where near as generous as our public employees system. Now let's hear the screaming about they built lousy cars, and that is why they went bankrupt. Think about this, the Japanese car makers who survived and prospered, the very automakers everyone held as an example of quality, did all this WITHOUT unions. Think about it.
william November 04, 2011 at 03:48 PM
Once again Dave D, I am not sure what you dont understand, but SB5 does very little about pensions for public workers. It will effect less than 5% of the public work force when it comes to the pension. And many private companies rehire, retired employees.
Dave D November 04, 2011 at 04:14 PM
William, I understand all too well. The 5% you are referring to is the percentage of government employees that actually have their share of pensions picked up. What I am referring to is nearly every member of the public workforce who has a pension. The pension and medical benefits that retired public employees get are no longer affordable to us, the taxpayer. This is similar to the drain on social security and medicare we are facing right now the biggest segment of the population, Baby Boomers are retiring, and this will also adversely affect local and state government budgets. Contracts were negotiated, and promises were made to these employees and must be kept. What SB5 will address, is the future of these benefits. Just like much needed changes in Social Security and Medicare need to be made for future retirees these changes must start being made to public employees not near retirement age and new hires. We can no longer afford to hire someone with the promise of pensions at near 100% of their salaries. I went on to the pers system to figure a benefit if I retired in the next 3 years. First of all I was astounded that I could just go on to the system, not being an employee, just answer some questions, plug in my compensation, and get an answer. I found that If I worked for 25 years, and retired by age 55, I would get 100% of my last 3 years salary average. We can no longer afford to fund this kind of retirement benefit. Check this out for yourself. .
william November 04, 2011 at 07:39 PM
Once again Dave, SB 5 pass or fail does not address the issues you are talking about. This will not change anything with the pensions. Also the medical benefits the retirees recieve is not funded by the taxpayer. The retirees are paying close to 100 % of the medical premiums. Actually a public employee who buys the retired health insurance ( for police and fire it is over $1000 a month ) is saving the taxpayer money. Otherwise they could be on govt assistance, costing the taxpayer more money.
Dave D November 04, 2011 at 10:11 PM
Wow William, you must think I just fell off the turnip truck Go to this site, and you will see someone with 30 years service, pays for themselves and their spouse, 1002 dollars a month. But of course this person could be 55 years old and drawing at least, $5000 a month retirement benefit. If this persons spouse is still working, chances are they are getting hospitalization from their job. At age 65 the spouse should be eligible for Medicare, in which case the retiree will only pay about 250 a month for his. This policy is medical mutual plus similar to the plan they have while working. A very generous plan. https://www.strsoh.org/pdfs/2011premiums-nomed.pdf Just click on that link, for that matter everyone should click on that link. As we know most public employees have worked enough quarters to be eligible for social security and Medicare. A teacher working 30 years can retire at 55 work another 10 years on the outside and draw another $1000 to $2000 dollars a month on top of the $5000 they get from. Then their premium for both will be $321 a month. (I can supply that link also) The state, (that's you and me folks) pays about $750 of the total premium plus the $1000 the the retiree pays, that is a nice policy. My son had to buy his own insurance, so he bought a high deductible policy for his family for about $550 a month. Now it is nowhere close to the teachers coverage, but he is in the private sector. Come up with a better argument William.
Rachel Abbey McCafferty (Editor) November 04, 2011 at 10:22 PM
Please don't forget our Terms of Use -- we ask you to use your real name. http://brecksville.patch.com/terms
Harry H. November 04, 2011 at 11:36 PM
I disagree. Kasich did not do what he thought he had to, he is doing what he is told to. Gov. Kasich, Gov. Walker, Gov. Christie, the Koch brothers etc. The agenda has been made public! Give tax breaks to the rich, break the unions, remove environmental regulations and kill the EPA, and turn public education into a voucher system. This is all good if your one of the elite but not so much for blue collar labor. Nothing in issue 2 will help struggling hard working families. And after the unions are broke, all of our state assets sold to the governors buddies in secret back room deals he calls jobs Ohio, public education ruined, minimum wage lowered and our air and water polluted to allow for bigger coporate profits our state will not be better off. Want to work for low wages and no benifits then move to Japan. As an Ohioan I would like to see good businesses that are willing to share profits with employees in wages and benifits or at least pitching in to pay off the deficits caused by the collapse and companies like Lehman Brothers (John Kasich). And I don't know of any employees that retire with 100% of their current pay, including public employees, so lets cut the nonsense. Just saying, but then again we are just "idiots" that are not deserving of good salaries and benifits. Only his hard working staff is deserving to make good salaries? HA!
william November 05, 2011 at 02:26 AM
Once again SB5 does very little to the public employees pension plans. Second public employees do not qualify for social security. Third, No money from the state budget is used to pay for pension or health care for retirees.
william November 05, 2011 at 02:28 AM
A pension reduces the likelihood that its recipients will have to turn to taxpayer-funded public assistance, Medicaid or social services in retirement, thus relieving taxpayers of future obligations, plus helps ensure these pensioners can continue to help sustain their local communities. A July 2009 report issued by the National Institute for Retirement Security (NIRS) shows that defined benefit pension income plays a critical role in reducing the risk of poverty and hardship among older Americans. The report, titled “The Pension Factor: Assessing the Role of Defined Benefit Plans in Reducing Elder Hardships,” notes that pension income resulted in a savings of $7.3 billion in public assistance expenditures and 4.7 million fewer households in poverty or near poverty in 2006 in the United States. More than 23 million older Americans received a defined benefit pension that year
william November 05, 2011 at 02:43 AM
Insurance companies do not give a different rate for private ( your son ) or public employees. Or do they care if you are a private or public employee. They do give a different rate depending on the number of people in your plan. For example, the pension plan has a large number, so they get a better rate than the one person looking for just him and his family.
william November 05, 2011 at 02:55 AM
The average monthly pension for Ohio’s public educators (as of July 1, 2010) is $3,104 or $37,249 annually. Not the $ 5000 you stated.
william November 05, 2011 at 03:00 AM
In April 2010, the Center for State and Local Government Excellence and the National Institute on Retirement Security stated Holding education and other characteristics the same, typical state employees earn 11 percent less, and local workers earn 12 percent less, than comparable private sector workers.
Dave D November 05, 2011 at 04:13 AM
William, who do you think strs is? The web site states strs contributes $752, the retiree contributes $250. Wow, I sure hope you aren't a teacher responsible for the education of my grandchildren. The web site clearly gives a second alternative to retirees on Medicare. https://www.strsoh.org/pdfs/2011premiums-medAB.pdf You clearly never even looked at the website. The state employees can collect both if they qualify.
Dave D November 05, 2011 at 04:17 AM
I growing weary of explaining the obvious. My son pays out of his pocket 550 a month for a family of 5. The retiree would pay 1002 plus the 750 strs pays. Now that is 1750 vs the 550. The pension plan really got some kind of discount?
Dave D November 05, 2011 at 04:18 AM
Original thoughts only please.
Dave D November 05, 2011 at 04:21 AM
Yes, that's the average, for preschool teacher, with 15 yrs to a high school teacher with 30. Good job. Gee guess what a teacher with 30 years gets? I was specifically talking about the 55 yr old teacher with 30 years. I bet ALMOST ANYONE in the private sector would love to have that deal.


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