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Democrats and the Decline of Public Sector Unions

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Democrats and the Decline of Public Sector Unions UNIVERSITY OF CALIFORNIA SANTA CRUZ UNRELIABLE ALLIES: DEMOCRATS AND THE DECLINE OF PUBLIC SECTOR UNIONS A dissertation submitted in partial satisfaction of the requirements for the degree of DOCTOR OF PHILOSOPHY in POLITICS by Abdullah Wais Hassan December 2017 The Dissertation of Abdullah Wais Hassan is approved: _______________________________ Professor Eva C. Bertram, chair _______________________________ Professor Daniel Wirls _______________________________ Professor Dana Frank ____________________________ Tyrus Miller Vice Provost and Dean of Graduate Studies Copyright © by Abdullah Wais Hassan 2017 Table of Contents INTRODUCTION 1 CHAPTER TWO – The Rise and Decline of Public Sector Unions 44 CHAPTER THREE – Democrats, Republicans, and Public Sector Unions, 1990 - 2014 74 CHAPTER FOUR – Understanding Retrenchment: Statistical Analysis of Votes on Pension Cuts 106 CHAPTER FIVE – The Battle Over Collective Bargaining Rights 139 CHAPTER SIX – The Battle Over Pension Cuts 211 CONCLUSION 262 APPENDIX 305 BIBLIOGRAPHY 314 iii TABLES AND FIGURES Tables Table 3.1 State Ranney Index Scores 1990-2010 84 Table 4.1 Descriptive Statistics for Categorical IVs 125 Table 4.2 Descriptive Statistics for Continuous IVs 126 Table 4.3 Odds Ratios and Robust Standard Errors for Potential Predictors 128 Table 4.4 Marginal Effects of Baseline Model at Mean Values 131 Table 4.5 Marginal Effects of Recession Model at Mean Values 133 Table 4.6 Coefficients and Odds Ratios for Potential Predictors of Legislative Voting for Pension Reduction, Recoded Model 135 Table 5.1 Collective Bargaining Expansion Bills, 1990-2014 Table 8.1 Anti-Collective Bargaining Bills and Right-to-Work 305 Table 8.2 Year of Implementation of Comprehensive Bargaining Statute 307 Table 8.3 Ordered Rank of Underfunded State Pension Plans 309 Table 8.4 State Changes to Reduce the Costs of Providing Retirement Plans, 311 2005-2014 Table 8.5 Partisan Vote Tally on Anti-Collective Bargaining Bills, 313 2011-2012 iv Figures Figure 1.1 Membership Density of Public and Private Sector Workers 4 Figure 2.1 Pension Reductions 1990 to 2014 69 Figure 2.2 Funded Ratios 1994 to 2011 70 Figure 2.3 Percent of Annual Required Contributions 71 Paid, 2000 to 2011 Figure 3.1 Wages, Salaries and Benefits as Share of Total Expenditures 82 Figure 4.1 Probability of Dems and Reps Voting Yes as State Debt Increases 134 v ABSTRACT Unreliable Allies: Democrats and the Decline of Public Sector Unions Abdullah Wais Hassan Public sector unionization rose dramatically during the 1960s and 1970s – even as private sector unions declined – and by 2010, membership in public sector unions surpassed that of private sector unions. They are now a mainstay of the U.S. labor movement, and wield sizable influence in local, state, and national politics. Yet public employee unions have recently been under political attack, and government employees have suffered losses in employment, compensation and bargaining rights at record levels since the Great Recession. Notably, these assaults have come not just from Republican-led statehouses, but from longstanding Democratic allies. Public sector unions have traditionally been a bulwark of the Democratic Party, providing Democratic officeholders money and votes. Scholarly accounts emphasize the close alliance Democrats built with public sector unions during the second half of the 20th century. Yet I argue that from the 1990s onward, Democratic-controlled state governments had a hand in weakening public sector unions and undercutting the position of public employees by opting not to expand bargaining rights, and by pursuing pension privatization and cutbacks. This project delineates public sector union history in four distinct phases (origins, expansion, stagnation and retrenchment), and traces the changing relationship vi between public sector unions and Democratic Party officials at the sub-national level. I use federal data, state legislative records, and interviews to examine the politics of the current period of retrenchment. Comparative state-level case studies and a regression analysis of voting on pension legislation in every state legislature reveal that Democratic support for retrenchment hinged on three factors: (1) interest group power and mobilization; (2) efforts of wealthy policy entrepreneurs; and (3) political leadership. I find that public sector unions were able to surmount this more difficult political environment only when labor (1) built coalitions with other interest groups and effectively countered business opposition; (2) secured large Democratic majorities within the statehouse; and (3) won the tacit support of the state’s governor. A looming Supreme Court ruling against mandatory union dues means the political environment for public sector unionization will only become more difficult in future years. vii DEDICATION I dedicate my dissertation to my family and especially my loving parents, Yunus and Seemin Hassan. I appreciate all the support my parents and sister, Pernia Hassan, have provided during the last seven years. viii Introduction I. Public Sector Unionization at a Crisis Moment The public sector in the United States endured an unprecedented economic and political assault during and after the Great Recession of 2007 to 2009. The recession devastated state budgets nationwide and inspired numerous retrenchment efforts. Public employees not only lost jobs and saw their wages fall, but also lost rights in the workplace and suffered pension cutbacks in the years that followed (Sustar 2012; Freeman and Han 2012; Lafer 2013; Hurd and Lee, 2014; Morrissey February 5, 2014). Although membership rates in the public sector have remained far more robust and stable during the last thirty-five years than membership rates in the private sector, unions in the public sector have come under severe strain in recent years (Rosenfeld 2014, 40-41). The percentage of government workers who are unionized declined from the early 1990s to 2016 (from 38.7 percent of the workforce to 34.4 percent), and unions suffered significant membership losses in regions such as the Midwest (Hirsch and MacPherson 2015; Greenhouse, March 4, 2016).8 The challenges confronting public employees and unions extend far beyond simple membership rates, however. Public sector workers saw their benefits cut at remarkable rates during the Great Recession era, and millions more were either furloughed or laid off. From 2009 to 2014, the public sector (federal, state and local) lost 634,000 jobs (Desilver, January 14, 2015). From 2007 to 2014 forty-eight states 8 In 2016, union membership fell to 10.7 percent, which is the lowest recorded percentage since the U.S. Bureau of Labor Statistics began recording membership rates in 1983. 1 reduced the generosity of their pension plans. And tens of thousands of public workers watched their collective bargaining rights disappear over the last two decades, as legislatures in the South and Midwest enacted regressive statutes and governors in Kentucky, Indiana, and Missouri rescinded bargaining rights through executive orders (Franklin, June 17, 2005; Stein, January 28, 2016). Public sector workers and unions face a more difficult environment than at any time since the 1950s, and are opposed by forces that have grown increasingly powerful and coordinated at both the federal and state levels (Slater 2004, Chapter 1; Lafer 2013; Hertel-Fernandez and Kashin 2015; Hertel-Fernandez and Skocpol 2016). The majority of US states9 today have adopted right-to-work (RTW) statutes, which prohibit union security agreements and have been shown to depress labor organizing (Ellwood and Fine 1987; Moore 1998). Right-to-work laws, passed in Indiana, Michigan, West Virginia and Wisconsin in recent years, place public and private sector unions under greater financial strain, as unions cannot rely on automatic dues collection to pay for collective bargaining. Right-to-work legislation also has a negative impact on public union membership. Levels of public sector union membership in right-to- work states are one third the level of membership in agency shop states.10 Studies indicate, for example, that states that implement RTW laws experience a 39 percent decrease in police union membership, a 37 percent decline in firefighter union 9Alabama, Arizona, Arkansas, Kansas, Florida, Georgia, Idaho, Indiana, Iowa, Louisiana, Michigan, Mississippi, Nebraska, Nevada, North Carolina, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Wisconsin, and Wyoming. 10 Agency shop agreements do not require employees to join a union. However, employees hired in workplaces that are agency shops must pay a fee for collective bargaining representation. 2 membership and a 66 percent decline in public welfare department union membership (Hundley, Fall 1988; Ichniowski and Zax 1991). Such trends suggest that public sector union membership in Indiana, Michigan, West Virginia, and Wisconsin will decline in coming years (Keefe 2015).11 At the federal level, public sector unions faced a serious challenge through the Supreme Court case Friedrichs v. California Teachers Association in 2016 (Sullivan, March 29, 2016).12 Though the Court deadlocked on the case (4-4) another challenge will be heard in 2018, before a full court of nine justices including newly confirmed conservative justice Neil Gorsuch (McIntosh, May 16, 2017).13 The implications of these setbacks are far-reaching. As private sector union density in the United States declined steadily beginning in the
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