Labor Needs To Step Up
The key to Connecticut’s fiscal future will not be handed to whoever wins the governor’s office in November. Nor will it be handed to whichever political party wins control of the state House of Representatives and Senate.
No, the key will remain in the hands of the state employee labor unions.
With many, including this editorial board, demanding that Republican Bob Stefanowski and Democrat Ned Lamont come clean with their plans to fix the state’s finances, the role of labor in the equation has remained in the background.
But labor can do more to salvage the state’s financial situation than any single elected official. Labor can save the day. Labor must be willing to step up.
A new governor might come along with a plan to reopen the 2017 deal with the State Employees Bargaining Agent Coalition with a lockpick or a hammer, but antagonistic approaches are wrong for the state.
Most of Connecticut’s financial problems are bound up in grand promises to state employees made years ago that were never paid for. Now the bills are due, and there isn’t enough money.
Labor will certainly argue that they’ve given back a lot. New hires don’t see nearly the benefits they might have years ago. Employees now contribute fractionally more to their own retirements. They’ve agreed to years of no raises (though many recently got a bonus). Taken together, it amounts to billions in savings. It’s true: labor has given back.
But that doesn’t wipe out a multibillion-dollar problem. The money the politicians of the past promised would materialize never did. The state pension accounts are critically underfunded. And here we are.
For years, labor’s go-to stance was to fight any giveback. That, along with complicit politicians, got Connecticut’s state employees some of the richest public sector retirement benefits in the nation. It’s unfortunate, but those benefits are now unaffordable.
Labor can come to the table with a plan or choose the nuclear option: wait for a governor to break the deal with a sovereign immunity claim and endure years of contentious and expensive litigation.
If such a claim wins at the federal level, every state employee’s benefits will be in jeopardy. It’s not worth it. The U.S. Supreme Court is already showing a bias against unions, and the addition of another conservative justice will only accentuate it.
If a sympathetic Democrat wins the governor’s office, unions might be tempted to feel relief. But more tax hikes to pay for unaffordable benefits would be equally counterproductive. Taxes are already pushing people and businesses out of state.
The only real place to cut spending is in costs to support state employees’ unaffordable pensions and benefits.
Labor leaders must agree to reopen the 2017 SEBAC deal. They must consider a system where the state could buy out employees’ pension plans and get them off the state’s books. They must contribute more to their own retirements and agree to align their pensions with the private sector.
Labor leaders, show some flex. Show compassion for people in Connecticut who aren’t state employees — such as the residents of cities that will face budget nightmares if they’re forced to continue to pay for other people’s Cadillac pension plans.
Labor leaders, come to the table. Don’t wait to be asked. Be a proactive part of the solution. It’s the best chance for growth in the future.