Steve Chapman

Back in the days when the Big Three owned the auto market, they could agree to generous terms with the United Auto Workers, knowing they could pass the extra costs on to consumers. That's no longer the case.

Big airlines used to enjoy protection from new competitors. Once commercial air travel was open to all, bankruptcies ensued, allowing high-cost carriers to scrap their labor contracts. More intense competition in the economy has deprived companies of leverage over prices -- and unions of leverage over wages.

Public sector unions have long been shielded from such pressures. Governments as a rule don't go bankrupt, and taxpayers can always be compelled to pay any costs.

That was the theory, anyway. Today, as states and municipalities find revenues insufficient to cover the pay and pension promises made to government employees, these unions face a much tougher bargaining environment. Politicians in most places have no choice but to look for ways to cut personnel costs.

Even in the past, the theory didn't quite match up with actual events. States like Wisconsin, Ohio and Indiana have recently curbed public workers' collective bargaining rights, which conservatives blame for bloated benefits. The assumption is that states with strong public employee unions would provide more lavish pay to government workers.

But economist Sylvester Schieber, author of the book "The Predictable Surprise: The Unraveling of the U.S. Retirement System," has studied the issue at length and told me, "My results suggest that the extent of unionization of the public workforce has no significant effect on the generosity of public pensions at the state and local level." He was surprised.

Right-to-work laws or not, mandatory collective bargaining or not, inexorable forces have weakened unions and eroded their presence. The battle over labor laws makes for great theater, but for the most part, theater is all it is.

Steve Chapman

Steve Chapman is a columnist and editorial writer for the Chicago Tribune.

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