Michigan's epic public union battle

Rod Meloni discusses Michigan's intensifying union battle

By Rod Meloni - Reporter, CFP ®
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DETROIT - We are watching Michigan's version of the public sector union battle play out.

The floodtide of advertising heading your way over the next three months won't spell it out this way, but that's what is coming with a flourish. Granted our battle is tepid in comparison to Wisconsin's. You will recall the national headlines and the breathless daily live news updates of that pitched battle between Wisconsin public sector unions and the state's new Republican Governor Scott Walker.

When he tried to reduce the amount of public sector union bargaining power there were the weeks long protests in the capital rotunda, legislators who couldn't win a vote picked up their marbles and drove across the state line to prevent that vote. There was the drawn out and very expensive union backed recall vote against the Governor that, in the end, did not remove him from office.

Well, Michigan Gov. Rick Snyder was watching. It's not his style to provoke that kind of chaos. But he did want the same thing Walker did. Snyder more stealthily weighed in with Public Act 4. With a Republican legislative majority, they teamed to, in a nutshell, put some real teeth in the State of Michigan's Emergency Manager Law [Public Act 72]. The teeth gave emergency managers the power to impose, rip up or otherwise alter public sector union contracts at will. The Governor viewed it as simple, responsible financial governance. The state's municipal unions immediately saw it as union busting. They attacked with some force. If you remember the embarrassing sound bite from Rev. Malik Shabazz saying the the Detroit Financial Review Team's deliberations "we will burn this city down before we let you take it over" was the cherry on top of the drama that played out in the City of Detroit alone [as the governor set out to use his newfound power under Public Act 4]. The American Federation of Municipal Employees flexed their considerable muscles all over the place trying to stop him. They spent lots of time and money in places like Ingham County courtrooms attempting to ball up the Governor's emergency manager and consent agreement work at every turn; some with little success, [Judge Collette, the Michigan Supreme court and Detroit's consent agreement] and others more so.

Today was that day. AFSCME was the money and the manpower behind the Stand Up For Democracy movement. It gathered more than two hundred thousand signatures in an attempt to get a repeal of Public Act 4 on the November ballot. Over the past six months, in fight after fight with the Michigan Board of Canvassers and several appeals courts over, of all trivial things, the font size in the petition's heading. After watching much haggling and gnashing of teeth, the Michigan Supreme Court ultimately weighed in and said the question should go on the November Ballot; and so it will.

One of the questions Stand Up for Democracy's petition drive left unanswered was this; "by repealing Public Act 4, what is a city of Detroit or any other municipality left with?" Here's the answer: Chapter 9 Bankruptcy [Note that several California cities have just filed.] A Chapter 9, which is federal municipal bankruptcy, [where a federal judge carves up the carcass of the city or town in question], has never been done in Michigan. Detroit would make the nation's largest Chapter 9 ever. That is why the governor was so intent on having the consent agreement the city now lives under. He desperately wanted to avoid that version of the Hindenburg disaster.

But the AFSCME membership knows it is in the desperate fight of its collective life. Members understand, as my late father would say, "the gravy train is about to end" unless something drastic happens. Their world of very specific negotiated work rules that few in the private sector can dream of are hanging in the balance. The rallying cry amounts to "it's last chance café!" There are things like essentially guaranteed employment, advancement based on seniority and vacation and sick time are accrued over a career useful as credits for later retirement calculations. Many double dip. They retire after twenty, twenty five or thirty years, take their pension and find another municipal union job somewhere else to start the process all over again. [To be fair, white collar employees do the very same thing] That's made possible by the higher than normal private sector defined benefit pension payments to add to the list. Let's note here few db plans exist anymore in the private sector. Most of the municipal plans have payout multiples that dwarf anything that remains in the private sector. This is great work if you can get it. It was always about the benefits in public employment that attracted so many, not so much the pay. Who could blame anyone in that system for trying with all their might and resources to keep it? But this municipal largesse is exceedingly expensive and the governor's office is happy to point out this is the stuff that accounts for 70 to 80 percent of all of the financial problems in the seven entities [Detroit City Schools, Muskegon Heights Schools, Highland Park Schools, The cities of Flint, Pontiac, Benton Harbor and Ecorse] that have emergency managers.

Now, in November, voters will get to give the Emergency Manager Law thumbs up or down. The petition drive collected a lot of signatures and you don't have to travel far in the City of Detroit to find resident who can spout the union line that Public Act 4 is a theft of democracy. Yet, it is equally easy to go into the suburbs across the state and hear residents watching the financial carnage and the emotionally charged political battles in horror wondering why anyone would stand by and watch governments spend themselves into oblivion unencumbered. This in a nutshell is how this public sector union battle will be fought. As it stands right now, the Governor's side is winning.

A Public Policy Polling survey done in late July [two weeks ago] puts the pro PA-4 forces up 41% to 31%. There are a lot of undecided voters left though. So, you can expect to see, hear or read hundreds if not thousands of television, radio and newspaper ads attempting to persuade you. You now know the reasons why it is happening. It's do-or-die time for the state's municipal unions. The same could be said for municipal budgets.

The question now becomes will outstate voters out number city voters in places where emergency managers now reside or may be about to?

This promises to be one important, epic battle.

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