No. 142

STONE the crows! Just watch the left-liberals seize on Sandy to sell their case for the big spending state and to smother the obvious question – why must people paid by the state provide services for citizens?

On Wednesday, New York’s Mayor Michael Bloomberg told a press conference:

New York City taxes itself and spends the money to protect us and to have the services that will keep us going. And I know of no other city that does that. Which always annoys me when they say, “Oh, you’re a highly taxed place.” Yeah, and we get something for it.[i]

And faster than a rapid-fire Rhiannon, advocates of the big spending state seized on the statement, like former New York governor Eliot Spitzer. (Oh come on, you remember Mr Spitzer – he was the bloke who resigned after being caught in 2008 socialising the salacious while privatising the prurient.)  His take on Sandy is that it makes the case for the public service state:

Who showed up in this moment of great need to provide shelter and emergency medical assistance? Who helped to rescue families from flooded areas and provided transport for the elderly? Who will be there to help fix the critical infrastructure that Sandy crippled? … It is too bad that it takes a tragedy like Sandy to get some folks to appreciate the essential role that government investments play in our society.[ii]

The Crows reckon by Monday natives of Linda Mottram land on ABC Radio 702 (are all her callers PSA officials?) will be using Sandy to sell the same specious suggestion that disaster preparation and relief justifies government spending as a whole.

There is no doubting all levels of government have done an outstanding job in repairing so much of New York in a week and, like a properly equipped defence force, public safety is a core component of the social contract. Governor Romney will rightly rue his criticism of FEMA if he wins the election – that is one federal agency he won’t end in a first term.[iii]

But this does not legitimise special pleading and feather bedding by public sector union officials disguised as community service. And, since 2008, US state and city governments are stuck with staff they can’t afford, as revenues decrease while wages rise. The public sector now pays a 20 per cent premium over comparable work undertaken in the for-profit economy.[iv]

Unions have understandably worked hard to undermine state governments who variously attack their members’ incomes, especially pensions the tax base can’t afford, and the authority of union officialdom. With some success, despite $100bn in contribution increases the unfunded liability of state and municipal worker schemes is nine times that.[v] And while the unions failed to have arch-enemy Wisconsin governor Scott Walker recalled, the brutal fight over his plan to restrict collective bargaining is not one many governors will want to take on.[vi]

In New York, the public sector unions are especially scary. Some 73 per cent of state and municipal employees are unionised (at the other end, North Carolina has eight per cent).[vii] The NY civil servant lobby has no problem with punishing politicians who incur its ire. In March, it cut off funding and volunteer workers for state legislators who voted for pension reform.[viii](Although DC37, “New York city’s largest public employee union,” endorsed President Obama.)

dows/Temporary Internet Files/Content.Outlook/PX1PA14S/crow nov 5.doc#_edn9″>[ix]

The power of the unions ensures people assume that public servants are synonymous with public service. David Rhode suggests the way New York recovers from Sandy has turned Tuesday into a referendum on the role government in society:

As a city resident, I have been impressed by the city government’s response this week. Armies of police officers, utility workers and mass transit employees have worked ceaselessly to save lives, restore order and repair a city infrastructure that in places is centuries old.[x]

Certainly these services should be provided by the state through the tax system but this does not mean the workers all have to be on the public payroll, or when they are use their collective numbers to win wages and conditions government can’t afford.


[i] Jen Brockman, “New York’s response to Sandy show why high taxes work,” MSNBC, November 1 @ recovered on November 3

[ii] Eliot Spitzer, “My view,” Current TV October 31 @ recovered on November 3

[iii] Associated Press, “Mitt Romney offers answer on his FEMA stance,” CBSNews October 31 @ recovered on November 3

[iv] Michael Marlow, “The huge cost of public unions,” New York Daily News, August 24

[v] Michael Corkery, “Pension crisis looms despite cuts,” Wall Street Journal,” September 21

[vi] “The jet-propelled Republican,” The Economist, June 6

[vii] Chris Edwards, “Public-sector unions,” Cato Institute Tax and Budget Bulletin, 61 (March 2010) @ on November

[viii] Erik Kriss, “Union suspends $$ for pension-cutting pols,” New York Post, March 20

[ix] “DC 37 says register, vote and volunteer,” @ recovered on November 3

[x] David Rhode, “Hurricane Sandy, Act II: the fallout puts government (and Bloomberg) on trial,” The Atlantic, November 2 on November 3