Tuesday, February 22, 2011

On No Bid Union Contracts

Apparently Governor Walker has something in the budget allowing for some no bid contracts and the left is up in arms. On this score I would agree with the lefties as I am no fan of no bid contracts. However.....

When was the last time a government union was subjected to a competitive bid for their services? Union contracts are always no bid.

If it is wrong (and it is) for government to sell power plants without competitive bidding, wouldn't it also be wrong to purchase labor without competitive bidding?

How about a little consistency. Let us put an end to all no bid contracts.


Sean Cranley said...

Do you really imagine Denis that there could be multiple unions out there with the personnel and resources to bid competatively bid on a contract and then deliver the professional, skilled employees to their appointed stations to seamlessly provide the services required? Where would they keep these employees when they are standby awaiting the next successful bid to furnish services, in boxes in a frozen storage wharehouse in Alaska?

And that's just for starters. Ya know, words like ridiculous, ludicrous and absurd are wearing out their usefulness as descriptors of the utopian fantasies that spill out of that dogmatically perturbed brain of yours.

Denis Navratil said...

You have amply demonstrated your superiority in the ad hominem department, so I won't challenge you there Sean. And now to your questions. Multiple unions, perhaps not. Multiple businesses with the capacity to do the work required by the state, absolutely. Obviously this is not possible in some cases. We couldn't have an entirely new police department move into Racine because they offered a lower bid. But certainly in some areas, probably most, we could. Is there some reason why garbage removal services could not be put up for competitive bid, as an example? Now at first it might take some time for businesses or other unions to gear up for these opportunities, but ultimately they would, and the citizens would enjoy the lower cost and improved service brought on by competition. And by know means would these opportunities be limited to low skill jobs. As we well know, educators in the private sector do a superior job relative to their public school counterparts, and for less money. Imagine the savings and the improvements in the lives of our precious young people. Any other claptrap challenges before you concede?

Sean Cranley said...

You're right Denis they are no bid contracts, because they are negotiated/arbitrated contracts. I've already demonstrated why your suggestion that unions might bid to provide these services won't work. Now I will address your point about privatization and show why it's not the panacea you seem to think it is, although it may make sense in some cases.

Breifly though, your claim that private sector teachers get superior results for less money is false and another symptom of not fully considering all aspects of issues and actually scratching the surface. I'm not sure what your metric is, or which schools you're comparing, but any difference your alleging is likely the difference in the student bodies, not the teachers.

Rutgers Prof Jeffrey Keefe just completed a study which shows that when controlling for education level Wisconsin Public Employees are under compensated by 4.8% compared to similar private sector employees, and that INCLUDES their pension and health insurance benefit packages: http://www.epi.org/publications/entry/6759/

59% of full-time Wisconsin public sector workers hold at least a four-year college degree, compared with 30% of full-time private sector workers. Wisconsin state and local governments pay college-educated employees 25% less in annual compensation, on average, than private employers.

The section above demonstrates that public workers are not compensated better than those in the private sector. Labor is by far the biggest cost in most public services, that's the nature of them and that will not change under privatization. Therefore, to reduce the cost significantly the only real way to do it is to reduce labor costs even further. But since public workers are already under compensated with respect to their private sector counterparts, the only way to do that is do further marginalize those private replacement workers (if you can) with low pay and little or no benefits. This of course has ripple effects and costs the community in many ways that won't be immediately apparent or easily traceable to the cause, yet they exist nonetheless.

Then there's the matter of profit that the owners or shareholders require. This will offset most if not all of the "savings" extracted from the workers.

So what do you end up with? Poor, marginalized workers in your community that are degraded in their ability to be citizens and customers. And you get the citizen's tax dollars leaving the community and going to rich owners/shareholders in some far away place, owners/shareholders concerned only with the bottom line, who have no connection or concern for the quality of life in the community in question and may be very unresponsive to the concerns of the citizens.

So your assertion that you'll get lower cost and improved services is by no means assured, but rather an article of faith. I'd rather have my tax dollars go to my neighbors to spend on Main Street than to end up with the Wall Street Banksters.

If you're interested, this link leads to a summary of a book on privatization by a Cornell professor. http://government.cce.cornell.edu/doc/summary.asp?id=sclar2000 There are fairly detailed summaries of the book and each of 7 chapters. I've only had time to skim them, but it seems like a fairly well balanced and scholarly look at the issue.