[acb-hsp] The New Welfare Moms?

[peter altschul]

Teachers, Secretaries and Social Workers: The New Welfare Moms?

by Randy Albelda

Dollars and Sense May/June 2011

Conservatives have had their sights on public-sector workers for 
a while and for good reason.  Public-sector workers represent two 
favorite targets: organized labor and government.  I am a 
public-sector employee and union member, so I can't help but take 
these attacks and struggles personally.  I am also a veteran of 
the welfare "reform" battles of the 1990's, and the debates over 
public-sector workers are strikingly similar.

Like welfare moms, public-sector workers have been painted as 
greedy [fill-in-the-blank barnyard animals], feeding from the 
public trough and targeted as the primary source of what's wrong 
with government today.  Like 1990's welfare-reform debates, this 
one is dominated by more fiction than fact.  For example, 
previous and recent research consistently shows public-sector 
workers actually earn less than private-sector workers with 
comparable skills and experience.  While many, but not all, 
public-sector workers who work long enough for the public sector 
have a defined-benefit pension, the unfunded portions of those 
pensions are often due to bad state policy, not union 
negotiations.

In some states, like my own, Massachusetts, current workers are 
paying most of their pension costs through their own 
contributions into interest-bearing pension funds.  Because state 
and local governments with defined pensions do not contribute to 
social security, there are currently cost savings.  The upshot is 
that the cost of pensions may not be as high as some are arguing.

It is true that health-insurance costs for current retirees are 
expensive and worrisome.  But this is because of the rising costs 
in private health insurance.  Making workers pay more for their 
health-care benefits will erode the compensation base of 
public-sector workers, but it won't get at the real problem of 
escalating health-care costs.

During the welfare debates, one of the arguments used to justify 
punitive legislative changes was spun around the fact that 
welfare moms who did get low-wage employment could also get 
child-care assistance -- while other moms could not.  Sound 
familiar? Public-sector workers do have employer- sponsored 
benefits many private-sector workers no longer get.  But benefits 
haven't improved in the public sector over the last 20 years; 
indeed most public-sector workers are paying more for the same 
benefits.

Over the same period, many private-sector workers have been 
stripped of their employer-provided benefits even as profits have 
soared.  Instead of asking why corporate America is stripping 
middle-class workers of decent health-care coverage and 
retirement plans, the demand is to strip public-sector workers of 
theirs.

The new Cadillac-driving welfare queens are the handful of errant 
politicians who game the pension system and a few highly paid 
administrators getting handsome pensions.  Sure they exist, but 
are hardly representative.  The typical public-sector worker is a 
woman, most often working as a teacher, secretary or social 
worker.  Women comprise 60% of all state and local workers 
(compared to their 47% representation in the private work force).  
And those three occupations make up 40% of the state and local 
work force.

Shaking down public-sector unions may make some feel better about 
solving government fiscal problems, but the end result will be 
more lousy jobs for educated and skilled workers.  It will also 
not stem the red ink that is causing states to disinvest in 
much-needed human and physical infrastructure with budget cuts.  
But eroding wages and benefits combined with public-sector 
bashing will send a very loud market signal to the best and 
brightest currently thinking about becoming teachers, librarians, 
or social workers to do something else.

Wisconsin Governor Scott Walter is leading the attack on 
public-sector workers today.  In the 1990's it was another 
Wisconsin governor, Tommy Thompson, who was a leader in demanding 
and implementing punitive changes to his state's welfare system.  
His plan became a model for the rest of the states and federal 
welfare legislation in 1996.  Then there were horror stories and 
welfare bashing, but not much in the way of discussing the real 
issue of decent paying jobs that poor and low-income mothers on 
and off welfare needed to support their families.  The main 
result of welfare reform was the growth in working-poor moms.

There is one important difference.  Public-sector workers, unlike 
welfare moms, have unions and a cadre of supporters behind them.

[Randy Albelda is a professor of economics at the University of 
Massachusetts-Boston and a Dollars and Sense Associate.]