Next Government Union Bailout Can Be Stopped

Speaker Kevin McCarthy has vowed that the House will “use the power of the purse” to “check” Big Labor President Joe Biden’s policies. Grassroots Right to Work supporters must hold Mr. McCarthy to his word. (Credit: Speaker Kevin McCarthy/Wikimedia Commons)

But Only if Concerned Citizens Turn up the Heat on Congress Now

It was just two years ago this month that a Big Labor Congress rubber-stamped and union-label Democrat President Joe Biden signed into law the so-called “American Rescue Plan” (ARP).

Mr. Biden, Senate Majority Leader Charles Schumer (D-N.Y.), and then-House Speaker Nancy Pelosi (D-Calif.) pitched the ARP to the American people as a spending package that would put an end to the COVID-19 pandemic and help state and local economies recover from COVID-19-related lockdowns.

But the fact is that the ARP featured an array of extremely expensive spending authorizations that had no genuine connection to COVID-19.

And the biggest of all was $530 billion for state and local governments that was obviously designed to help Big Labor state and local politicians paper over huge fiscal shortfalls caused primarily by union monopoly-bargaining abuses, not COVID-19. 

Scheme Explicitly Allowed Spending Bailout Money on Day-to-Day Public Services

The vast majority of the ARP’s state and-local bailout money was allocated according to a formula that rewarded forced-dues states like New York, California, and New Jersey that still had very high unemployment in 2021 because they continued to prohibit many businesses from reopening.

Meanwhile, Right to Work states like Florida and Tennessee, in which businesses of all kinds had already been allowed to reopen, without measurably contributing to COVID-19 spread, got penalized for having lower unemployment.

Moreover, the ARP explicitly allowed states and localities to spend bailout money to pay for day-to-day government services.

In other words, union-label state politicians got to use money extracted from taxpayers across the country to keep schools and police departments open while taking money from their general funds that would have paid for such services to conceal huge shortfalls in their government pension systems!

“For a short while after the ARP became law,” recalled National Right to Work Committee President Mark Mix, “Big Labor state politicians like Illinois Gov. J.B. Pritzker [D] and California Gov. Gavin Newsom [D] were able to boast about the ‘progress’ they were making in addressing their government pension systems’ massive underfunding.

“Overwhelmingly, that progress came courtesy of federal taxpayers, vast numbers of whom live in Right to Work states that have managed their affairs far more responsibly than have forced-dues Illinois and California.”

Today, Big Labor-Dominated States Are Once Again Facing Enormous Fiscal Shortfalls

Of course, it didn’t take long for grossly underfunded government pension systems jerry-built over decades by union-label politicians and Big Labor bosses to run through their piles of ARP bailout money.

This winter, forced-unionism states like Illinois, California, and New Jersey are in deep money trouble again.

For example, last December, the Illinois Teacher Retirement System actuarial report for Fiscal 2022 stated that, in a single year, its unfunded liabilities had soared by roughly $6 billion, to reach a total of $80.7 billion. Over the next few months, other Illinois government pension funds are expected to issue similarly dismal reports.

But if Joe Biden plans to run for a second term as President, which seems much more likely now than it did a few months ago, he cannot afford to allow his ARP “achievement” to unravel in 2023 or 2024. Rather than do that, he will push for legislation handing additional tens or hundreds of billions of taxpayer dollars to improvident state politicians and government union bigwigs in order to put off their days of reckoning for another few years.

“Right to Work supporters must prepare now to stop the next Big Labor bailout,” warned Mr. Mix.

“Fortunately, in the current Congress, unlike in 2021, Joe Biden can’t count on Nancy Pelosi to join with Chuck Schumer in helping him get a congressional rubberstamp for all of his costly handouts to union bigwigs.

“Today, the reins of the House are held by Republican Kevin McCarthy [Calif.], who, in his first speech as speaker this January, vowed that his chamber would ‘use the power of the purse’ to ‘check’ Biden policies.

“Right to Work legislative staff are now already pressing the speaker, through communications with his staff, to show he meant what he said by vowing to do everything possible to ensure there are no more D.C. bailouts of Big Labor in 2023 or 2024. And I urge Right to Work members everywhere to reinforce the message by calling Mr. McCarthy’s office at 202-225-2915.”

This article was originally published in our monthly newsletter. Go here to access previous newsletter posts.

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