Puerto Rico’s government was ruined by public unions

Many people wonder “what went wrong” in Puerto Rico and why the island’s “economic miracle” of the mid-20th Century degenerated into financial crisis and bad government.

To help understand what happened, we must look at what went wrong in the U.S., with its own deterioration of the government and economy. It’s about the enormous power of public employee unions.

First a little personal history. In 1961, at the San Juan Star, an accountant, Luis Montanez, approached me one day and asked, “why don’t we organize a union?” It didn’t seem like a good idea since the Star was only a yearand-a half old, struggling to become economically viable.

But I believed strongly in unions. I came from a union family, with my father being a life-long member of a New York City hotel union and my mother a member of the International Ladies’ Garment Workers’ Union. I convinced myself that it would be good for the Star, so a group of us formed the Puerto Rico Chapter of the American Newspaper Guild. As president, I found myself negotiating a collective bargaining contract.

From a rookie reporter, I found myself with extraordinary power almost overnight. I now had the power of life or death over the newspaper. In my heart of hearts, I knew I would never call a strike, knowing that it would kill the paper. Being a Star reporter was the best thing that ever happened to me. But I made sure no one knew this, for I knew my power came precisely from the threat of a strike. It was the loaded gun I put on top of the table that impelled management to negotiate. But as a journalist covering politics and government, the union experience led me to a difficult conclusion: Yes, unions in the private sector are vital to democratic capitalism, but they make no sense in government.

At the San Juan Star, I had power over a private firm, and if we had the threat of striking, management had the threat of closing the paper if it decided it could not operate profitably. But public employee unions are negotiating against the government that belongs to the people, which cannot “close,” giving them far more power than any private sector union.

So, it became evident to me that back in 1952, when the island Constitution was enacted, the Puerto Rico government made a bad mistake in authorizing the unionization of employees in the public corporation providing precisely the most essential public services. And the error was greatly magnified on Feb. 25, 1998, when Gov. Pedro Rosselló extended the right to unionize with collective bargaining to all government employees.

I don’t think I was exaggerating when I wrote: “The unionization bill was the single most destructive act against the right of the Puerto Rican people to run, through its governor and appointed officials, the government of Puerto Rico.”

In “Not Accountable: Rethinking the Constitutionality of Public Employee Unions,” Philip Howard writes, “No one elected unions to co-run American government. No democratic principle gave legislators and other officials the right to surrender government powers to unions. No ethical value allows public employees, having taken an oath to protect the public, to organize politically to harm the public. Democracy under union restraints can’t work as the framers intended.”

This answers a key question: why would government leaders enact laws and engage in collective bargaining that effectively takes away a big part of their power to govern? According to Howard, the unions “have the money, manpower, resources to elect unionfriendly politicians and to punish those that aren’t.” This power impedes reform of agencies and makes collective bargaining even more one-sided, effectively allowing them to “sit on both sides of the negotiation table.”

But Howard has a solution. He writes that public employee unions are, in fact, unconstitutional. “The operating machinery of American democracy is now in the grips of public unions. Voters elect officials who have been disempowered by union controls.” This, he writes, violates the U.S. Constitution, which prohibits elected officials delegating, giving away (in this case to unions) sovereign powers to govern.

My short career as a “union leader” led me to the conclusion that the Puerto Rico government and the Puerto Rico economy have deteriorated so badly primarily because of the huge mistake of giving enormous power to public employee unions.