Labor's entitlement state

AT THE ANNUAL EXECUTIVE COUNCIL meeting in Las Vegas, AFL-CIO Pres. John Sweeney won a major battle within the ranks of labor. He faced down a challenge from the Teamsters Union and the Service Employees International Union to devote a substantial proportion of the AFL-CIO budget to organizing nonunion employees. Less than 10% of all private sector employees are unionized. Sweeney's prevailing view was that labor should put a majority of its resources into political activity, most, of course, in support of Democrats.

Sweeney's allies in the labor movement represent public sector employees, which have direct interest in the success of the Democratic Party and the growth of government. Teachers and other public service employees feast on higher taxes and government monopolies of social services. It would be hard to call most public school teachers and government employees poor, or even working class. While Sweeney and his minions certainly give lip service to organizing workers at the lower rungs of the economic ladder, their money goes elsewhere.

This represents not only a shift in the thinking of the labor movement, once the hope of struggling blue collar workers, but of the Democratic Party. The liberal rhetoric of compassion for the poor and pillory of Republicans as tools of the rich has not changed since the days of Franklin D. Roosevelt. What is different, however, is the reality beneath such rhetoric. The interests of poor unorganized workers have become secondary to the expansion of government.

Indeed, the Democrats support programs that assist the poor such as Head Start, food stamps, and Medicaid, but so do many Republicans. What drives the Democrats is the desire to expand government entitlements and services to the middle class. The more services government provides for the middle class, the greater will be the demand for government. As the party of government, Democrats win; as the representatives of public sector workers, Sweeney's AFL-CIO wins as well.

This defines the nature of much contemporary partisan political conflict. When Pres. George W. Bush talks of the ownership society, he is throwing down the gauntlet to the Democrats and their labor allies. If individuals are allowed to control their retirement plans, educational choices, and medical plans, the state and its employees are left with less to say and even less to do. The march of government entitlements to the middle class makes Bush's task extremely difficult--witness his struggle over Social Security reform.

As a consequence of decisions made in his first term, Bush has made his life more difficult. The prescription drug bilL opposed by many conservatives in his party, offers a hugely expensive benefit to seniors who can well afford to buy such a plan with private insurance. AARP, a powerful voice for affluent seniors, supported Bush's bill knowing full well they could expand it in the future. Once an entitlement is offered, it never is taken away and usually becomes more generous as time goes on. Social Security originally was conceived as a means to prevent poverty in old age and financed by a modest tax rate on the first couple thousand dollars of wages. As the wage cap rose and the tax rate increased, Social Security provided a generous supplement to the income of upper-middle class seniors. The modest goal of Roosevelt's 1935 legislation has long since been surpassed. Seniors, according to the polls, will not tolerate any serious reform of Social Security, even if they will not be affected directly. Such is the psychology of entitlement dependency.

The Democratic Party's mission is to play to this psychology by fighting to preserve and extend these entitlement programs. Grant the middle class entitlements and scare them to death if anyone suggests reforming them--this strategy, not foreign policy or cultural issues, could return the Dems to the White House in 2008.

As was the case with prescription drugs, the Democrats would not accept a program tailored primarily for lower-income seniors. Such an initiative is too modest for those who want the broad constituency of the elderly dependent on a government-financed drug program.

In the case of school vouchers for poor minority children trapped in dysfunctional public schools, Democrats side with the teachers union over the needs of these youngsters and their families. Many Democrats, including Sen. Ted Kennedy, were willing to filibuster a modest bill tot a pilot voucher program for students in the disgraceful Washington, D.C., public school system. Fortunately for those kids, they failed.

In the current debates over Social Security and Medicare, Pres. Bush and the opposing Democrats have a long-term political strategy. Bush and the Republicans believe that private investment and medical savings accounts will wean people away from government dependency and create a broader investment class that will trend Republican. The Democrats, as the party of government, want more entitlements and thus, more Democrats--and the larger the state, the more jobs there are for John Sweeney's public sector unions.