Campbell (R-Irvine) is an Assemblyman representing the 70th
in Orange County. Mr. Campbell is the Vice-Chairman of the Assembly
Budget Committee. He is the only CPA in the California State
and recently received a national award as Freshman Republican
Legislator of the Year. He represents the cities of Newport
Laguna Beach, Irvine, Costa Mesa, Tustin, Aliso Viejo, Laguna
Woods and Lake Forest. He can be reached through his Assembly
and through the website
for his California Senate campaign. [go to Campbell index]
Had It Right
Public unions are the problem in California, too.
[John Campbell] 2/3/04
Thatcher was elected in 1979 as the first female prime minister
Britain. She was leader of the Conservative
Party in the UK and remained in power for 11 years. When the "Iron
Lady" took over, Britain was in the grips of a sustained
and structural economic decline and was known as "the sick
man of Europe." Thatcher proclaimed: "The two great
problems of the British economy are the monopoly nationalized
industries and the monopoly trade unions."
She immediately instituted reforms that included privatizing
nationalized industries, restricting the power of union leaders,
and breaking the monopoly grip of the trade unions on government
with various changes - including making union membership optional
for workers. These reforms restored prosperity to Britain, transforming
its economy from one of the worst in Europe to one of the best.
So, what does Great Britain in 1979 have to do with California
in 2004? A lot, actually. The similarities are striking. Although
the depth of California's economic malaise now is not as great
as Britain's then, our budget deficit, business climate, tax
rates, credit rating and insurance costs are among the worst
of all 50 states. Our problems are persistent and structural
And the root causes
of our problems are much the same as England's were. We have
too many parts of our economy that have been "nationalized" by
the state, and the power of public employee unions is perverse,
destructive and way too high.
Let's take these one
at a time. When I talk about "nationalization" by
the state, I do not mean that housing and transportation have
been taken over by the state (although there are many elected
Democrats who would like to do this). I refer instead to the
increasing tendency of state law to prohibit public entities
from "contracting out" for services and instead requiring
them to use government union workers. Such a law was recently
passed and signed by Gov. Davis that prohibits school districts
from contracting out for janitorial and bus services. Such a
policy costs the Capistrano Unified School District more than
$3 million annually because they cannot shop for the best service
at the lowest price. That's $3 million that could be spent for
class-size reduction or music programs, or that could be saved
in their budget. But instead, state law requires that it be spent
on inflated government union salaries and benefit packages. That's
$3 million for one school district alone. Statewide, it is hundreds
of millions of dollars.
And that's just schools. Such prohibitions on allowing private
sector providers to bid on public sector jobs exist all over
the government. CalTrans has nearly 10,000 engineers on staff
and in their union. But we are building a lot less roads (and
no new freeways). Wouldn't it make sense to reduce this staff
to a minimum and contract the engineering out on a job-by-job
basis? That way, we would have flexibility so that we are not
paying for staff to design roads that are not being built, we
could competitively bid for the best work at the lowest price,
and taxpayers would be relieved of the obligation to pay expensive
It all sounds so logical, you say. What could possibly keep
us from allowing any government entity to contract out anytime?
Therein lies the second barrier to economic recovery in California;
the power of the public employee unions.
Almost all of the largest campaign contributors in California
are unions (with a few Indian tribes mixed in). Most of those
are public employee unions with the California teachers association
being the biggest spender. Many cities have prohibitions against
a council member voting on an issue that affects only a company
that has been a campaign contributor. But all elected officials
are routinely allowed to vote on pay and benefit increases and
contracting out prohibitions that affect the very unions who
are their biggest campaign contributors.
We have seen it over and over again during the past few years.
Unions contributed millions to Gray Davis and pro-union monopoly
legislators. They then turned around and voted for pay and benefit
increases costing you and me hundreds of millions in taxes. It's
a great return on investment for the unions. It's a lousy use
of taxpayer's money.
And it's wrong. You should not be able to contribute to the
very people who determine your paycheck. Other campaign contributors
are usually supporting a philosophy or indirect benefits like
lower taxes and lower worker's compensation insurance premiums.
But the public employee unions are the only ones that can actually
make a contribution, and get the money returned directly to them
through increased salaries and union dues. That's why they contribute
so much. That's why they have so much power. That's why our budget
is out of control. And that's why we must change this abusive
Mrs. Thatcher, by her own admission, could not have fixed Britain's
economy without curbing the power of the unions and de-nationalizing
business. We cannot fix California's structural budget and economic
problems without doing the same thing. We must allow the state
and cities and counties and school districts to always get the
best job at the lowest cost, be it contracting out or in-house;
be it union or non-union. We must not compel government employees
to join a union if they don't want to. And we must prohibit unions
from contributing to anyone who votes on or negotiates their
pay and benefits.
It took the "iron will" of the "Iron Lady" to
do this in Britain. It will take a similar will to do it in California.
But we must develop the courage to face down the power and money
of these abusive unions and break forever the tyranny of these
few that threatens the welfare of us all.