To be clear, I’m making an argument that’s different from “Government workers are overpaid.” I’m saying that they are paid in the wrong ways — in ways that make life easier on union leaders and elected officials, at least initially, but that eventually hurt both workers and taxpayers.
The best example is health insurance. Health plans for union workers and retirees are much more likely to require little or no co-payment, which leads to lots of medical treatments that don’t make people any healthier, and to huge costs. Ultimately, some of these plans will probably prove so expensive as to be unsustainable. Workers would have been better off accepting a less generous benefit package and slightly higher salaries.
The solution today is not to cut both the pay and the benefits of public workers, as would happen if workers in Wisconsin, Ohio and elsewhere lost their right to bargain. Remember, public workers don’t get especially generous salaries. The solution is to get rid of the deferred benefits that make no sense — the wasteful health plans, the pensions that start at age 55 and still let retirees draw a full salary elsewhere, the definitions of disability that treat herniated discs as incurable.