Connecticut pays its state employees top dollar, which is anomalous since the state is in the worst fiscal/financial condition of the 50 states. Yet, why write about this again? I have written repeatedly about the 33% wage increase state employees have enjoyed under Ned Lamont – an increase far in excess of the 23% pay increase seen by average private sector workers in the nation over this period. I have called repeatedly for a two-year wage freeze.
Once again, why write another column? Because, now, Lamont is about to submit a new state employee contract to the General Assembly for legislators’ approval. The current wage agreement expires in less than three months.
Yet, with union-friendly Democrats holding supermajorities in both the Senate and the House, approval is a virtual certainty, so why write about it? Because even free-spending Democrats may not want to go on record approving the largesse that Lamont has ladled out to unionized state employees and seems poised to ladle out again. Herein lies the suspense in this story.
In his February budget proposal, Lamont put $500 million in the Reserve for Salary Adjustments to fund the coming wage increase. In addition, his budget proposal projected fringe benefits would increase $740 million, according to the Office of Fiscal Analysis. The $1.24 billion combined increase would absorb 58% of the allowable increase in spending ($2.15 billion) under the constitutional spending cap (see page A-4 of the Budget Proposal).
Already most Democrats are complaining bitterly that they do not have enough money to spend (what else is new?). Yet, they mistakenly blame the shortage of funds on the fiscal guardrails, which they want to weaken or eliminate. Yet, the constitutional spending cap is the problem. It is part of the state constitution, so, it cannot be eliminated even if the guardrails are deep-sixed.
Even union-friendly Democrats may not want to put their fingerprints on such a stupendous increase for unionized state employees, given that this compensation increase is the real culprit crowding out the spending they want to unleash.
The marvel is that there’s a way they can have their cake and eat it too. There is a fail-safe mechanism in place in case opposition to a labor contract ever develops that might threaten contract approval. If a contract is rejected, it is sent out for arbitration. Then, the arbitrated contract is re-presented to the General Assembly. If it is rejected again, it goes out for final arbitration… and never comes back to the legislature. A labor arbitrator makes the final decision, not the legislature.
This mechanism is designed to thwart Republicans in the highly unlikely event that they were to win a majority in the General Assembly and to vote to reject a contract.
Why is this a fail-safe mechanism? Because virtually all labor arbitrators are “homer refs.” Arbitrators are not called upon to settle labor disputes between employers and non-unionized work forces. In the Carolinas and in Utah, there is no need for public sector arbitrators because collective bargaining is not permitted in the public sector in those states. Arbitrators depend upon unions for their jobs. It is only natural that they favor unions. And they do.
While this fail-safe is meant to guard against hostile Republicans, this time around, the Democrats could utilize it to feign fiscal responsibility. They could posture as fiscally responsible and reject Lamont’s contract with a wink and a nod to their union buddies assuring them that the arbitrators will take care of them.
This would be a gutsy political gambit. But the alternative is not a pretty one. If the Democrats devote almost 60% of the legal maximum of spendable funds to state employee paychecks and pensions and other benefits, they can hardly complain about a lack of funds. Or at least, they could not complain if Republicans were successful in highlighting their hypocrisy.
Watch carefully in the next few days or weeks. It will be interesting to see whether Democrats vote to approve Lamont’s new contract with the unions. It is not totally inconceivable that they will vote against the contract and send it out for arbitration, knowing that the arbitrators will approve most, if not all, of what Lamont has in store for his union buddies.
Yet, no matter what posturing union-loving Democrats adopt, nothing will change the fact that what Lamont is paying his union buddies is crowding out other spending and placing an unaffordable and unfair burden on average lower-paid taxpayers in the private sector in this state.
Red Jahncke is a nationally recognized columnist, who writes about politics and policy. His columns appear in numerous national publications, such as The Wall Street Journal, Bloomberg, USA Today, The Hill, Issues & Insights and National Review as well as many Connecticut newspapers.