Star Parker
  The joke goes that the difference between neurotics and psychotics is that neurotics build castles in the sky and psychotics live in them. A corollary to this would be that reality is an important thing to be in touch with.

This is the message to think about in the context of the big union breakup news of the last week.

The Service Employees International Union and the Teamsters are leaving the AFL-CIO to form a new Change to Win Coalition. There is legitimate concern about shrinking union membership.

The dissidents want to see less money spent on politics and more on organizing and recruiting. On an individual level, a lot of union members are conservatives, many Christian conservatives, and they are sick of paying dues to an organization that has been a rubber stamp of the left and the Democratic Party.

The operative question, however, is whether the Change to Win Coalition represents a new era of union realism or whether these dissident unions are simply moving into a new castle in the sky.

There is good reason to believe it is the latter, and that the laborers who are staking their lives and futures on this change would be well advised to do their own personal reality check.

Think, for instance, about the prospects for two central issues of traditional union activism _ health care and retirement benefits. The real changes necessary to bolster these areas are in the direction away from employer control and toward individual ownership and management. This means less and less relevance for unions.

This is why the AFL-CIO has been an opponent of the kinds of health care and retirement benefits reforms we all need.

Consider the employer-provided health-care model that Americans have taken for granted for years. There is good reason to believe this stalwart institution that unions work so hard to preserve is part of the health-care problem we are trying to solve.

Third-party-payer health care, as in employer health-care plans, where the patient does not bear direct responsibility for paying the bills, has been a prime mover of escalating health-care costs. Why think twice about going to the doctor when someone else is paying the bill? When is the last time you asked a doctor how much a test costs he suggests you ought to have?

Despite the fact that employer-provided health care seems as part of American culture as July Fourth fireworks, it is a relic of the World War II economy. Because of wage controls, firms started providing health benefits in order to compete for workers. When the IRS required that these benefits be reported as taxable income, Congress passed legislation allowing that company health benefits be tax-exempt.

Star Parker

Star Parker is founder and president of CURE, the Center for Urban Renewal and Education, a 501c3 think tank which explores and promotes market based public policy to fight poverty, as well as author of the newly revised Uncle Sam's Plantation: How Big Government Enslaves America's Poor and What We Can do About It.