Reflections on the June 5 Recall

By Arthur C. Brooks

Scott Walker’s victory over Wisconsin’s public sector unions and their political allies is a victory not just for his state, but also for taxpayers nationwide. Walker has demonstrated more willingness to tip over the apple carts of public sector unions than almost any recent governor, and he has now shown that standing up to entrenched and powerful interest groups is not a death sentence.

Walker’s triumph is to be celebrated, and it will likely diminish the enthusiasm of the privileged classes in other states to punish pro-growth, pro-taxpayer politicians. But focusing on the recall per se misses the most important point. What’s most important is what Walker would have accomplished even if he had lost his recall fight.

In fewer than 18 months in office, Scott Walker did more for the cause of efficient state government than almost any other governor in memory. Walker rang a bell that cannot be unrung, not just in Wisconsin, but around the country. His governorship is now ratified, but only in another decade will the true import of Walker’s deeds be understood.

Walker’s success came in stating the public-finance fact that few in public life dare to utter: Public-sector collective bargaining is unfair and inherently untenable. In the private sector, unions negotiate with employers who are constrained by costs and competition. Unions have an interest in keeping the firm healthy. But the public sector is different, because taxpayers — unlike customers — can be legally forced to pay higher prices for goods and services provided by government.

Rather than face the wrath of organized government workers, many politicians have simply made unrealistic promises that future officials — and taxpayers — will have to pay for. If this sounds unfair and unsustainable, it’s because it is.

What Walker did was to reinstitute what used to be commonly accepted, obvious-on-its-face economics. President Franklin Roosevelt — hardly a right-wing ideologue — wrote in 1937, “All government employees should realize that the process of collective bargaining, as usually understood, cannot be transplanted into the public service. It has its distinct and insurmountable limitations when applied to public personnel management.”

In 1955, AFL-CIO chief George Meany put it even more plainly: “It is impossible to bargain collectively with the government.”

Nothing fundamental changed in the ensuing years, except this: A rapidly growing economy, undergirded by robust free enterprise and small government (at least relative to today) made public-sector collective bargaining temporarily appear affordable. That was an illusion, of course, as the financial crisis and sluggish economy made clear. A majority of Wisconsinites have shown that they recognize this fact.

Wisconsin is in better fiscal shape today — and will be for the foreseeable future — because of Scott Walker’s reforms. Perhaps more importantly, Walker was the progenitor of a series of changes, not just in policy, but also in public attitudes, about the relationship between public employees, politicians and taxpayers.
Walker’s electoral victory is important. But setting in motion what is becoming a national trend will be his legacy.

Arthur C. Brooks is president of the American Enterprise Institute, a public-policy think tank. His new book is The Road to Freedom: How to Win the Fight for Free Enterprise (Basic Books).