Sunday, November 4, 2012

California's Prop 32 - The Dagger Aimed at Unions

The Wall Street Journal editorialized on October 31 that the second most important vote on Tuesday will be in California on Prop 30, the substantial tax increase that will pump funds into the broke teachers’ pension plans and drive more business and residents out of the state.

That’s not what the supporters say. They claim Prop 30 will raise $6 billion annually that will go to the schools. The state’s current budget deficit is $19 billion, and rising fast. 

Do the math!

The wording of Prop 30 is almost 5 large pages of impenetrable text.

The opponents of Prop 30 point out that the Act does not mandate the funds go to education in the sense that the Legislature can simply redirect money from other education budget lines to other purposes. The California legislators are well experienced in playing shell games with the budget.

Governor Jerry Brown is using the state universities and colleges as hostages, threatening substantial cuts to their budgets if Prop 30 fails.

Prop 30 is a major threat to California’s future.

However, with all due respect to the Wall Street Journal, Prop 32 is the key proposition.

Prop 32 is a dagger aimed at the jugular of the California unions. It is an attempt to defenestrate unions from the public fisc. It is mainly financed by a Stanford physicist, Charles Munger, Jr., who’s put at least $22 million into it.

The proposition is labeled the “Stop Special Interest Money Now Act.” It bans labor unions and corporations from deducting from member or employee pay checks any monies to be used for political purposes.

Money is the lifeblood, or mother’s milk, of politics. Unions have used their financial resources in California to control the California Democratic Party, and thus the state legislature, as they do in Connecticut and Illinois. They do it through campaign contributions raised through mandatory employee payroll deductions.

We know the unions are worried by Prop 32 because they are spending substantially more to defeat Prop 32 than to pass Prop 30. The latest figures show the unions spent  $64 million so far against 32. They started early, arguing it’s a special interest bill that exempts special interests, such as the Koch Brothers, insurance companies, real estate developers, and venture capitalists. They seem to have gained a strategic advantage by doing so.

The California Teachers Association has spent at least $32.4 million on Yes on 30, No on 32 with most of it going to the Stop 32 Campaign.

The public employee unions suffered major losses in the 2010 midterm elections. Indiana became a Right to Work State and Wisconsin banned the deduction of union dues from employee paychecks unless they agree each year to the deduction. They lost their attempts to recall the Governor and rescind the statutes.

The California proposition does not bar the deduction of union dues, unlike the Wisconsin act, but requires the annual consent of employees for the deductions.

The California unions, because of their political war chests, are able to pass 50% of the referendums they support and block 75% of the ones they oppose.

Proposition 32 is probably going to fail, but the unions had to divert substantial sums from other political campaigns. They could have spent the $64 million on other campaigns, but couldn't.

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