Who wins the Wisconsin fight over employee benefits and rights?

Madison, Wisconsin, has looked like Cairo or Tunis during the protests against incumbent dictators. The difference is that Wisconsin’s Governor Scott Walker was duly elected in a landslide by Wisconsin voters only four months ago. Anyone think he feels threatened by chants of “We’ll remember in November”?

Governor Scott campaigned on a platform of reducing pay and benefits for state employees to address his state’s budget deficit. He has introduced legislation to do that and limit the power of employee unions to bargaining over wage increases limited by the consumer price index. Governor Scott’s fellow Republicans control both houses of the state legislature. To delay enactment of Governor Scott’s wage and benefit reforms, minority Democrats in the state senate have fled the state to prevent a quorum for a vote. Supporters of organized labor have flocked to the state capital from across the nation to stage daily continuing protests.

Job losses and resulting losses of income and benefits in the private sector have put the spotlight on government workers, who continue to enjoy good pay and excellent benefits which are no longer available in the private sector. Here in Philadelphia we are regularly reminded of the excellent health care and retirement benefits, including DROP, the deferred retirement option plan, available to city workers.

Claims that government workers are actually underpaid with worse benefits than they could earn in the private sector ring false, because if that were true, why wouldn’t they just quit and grab that higher pay and better benefits in the private sector? Taxpayers working in the private sector feel the pressure holding down their wages, know they are paying more every year to maintain health care coverage, and know they have to plan for their own retirement, usually through defined contribution plans like 401(k)’s. And everyone knows someone with a public sector job who works less hours with better pay and benefits than they could earn in the private sector.

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With more and more state and local governments struggling with rising deficits, taxpayers are no longer willing to exclude government workers from having to share in the pain of cutbacks. That’s the political reality not just in Wisconsin, but also in New Jersey, and Pennsylvania, and many other states and localities.

So it’s hard to see how the public sector unions hope to defeat the newly-elected Republican governors who campaigned on cutting costs. All they can do is try to stall the cutbacks while hoping that something changes in their favor. But what could that be?

We are well into the presidential election cycle leading up to the 2012 election. Despite the recession and Republican electoral victories in 2010, and the intense personal attacks on his policies, President Obama begins his campaign for re-election in a surprisingly strong position. His poll numbers are recovering, and Republicans do not appear to have a strong candidate to run against him. Less than a year before the Iowa presidential caucuses, there are still no announced Republican candidates willing to challenge the president.

But prolonged labor strife in the public sector threatens to alienate organized labor from the President if he can’t save them from Republican cuts, even while it alienates voters who work in the private sector. For Republicans, the high-profile confrontation in Wisconsin over state employee pay and benefits is a win-win situation.  But for President Obama, maybe not.

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