Shikha Dalmia writes an insightful op-ed piece in the Wall Street Journal weekend edition from July 11-12, 2009 titled The "Free Choice" Act and Binding Arbitration that everyone should read. The article highlights how disastrous this has been for states that have adopted it in the past and how the lawmakers who once supported it are now saying it was a mistake. However, the unions and President Obama's administration is pushing forward with policy on a national scale. Here are some highlights.
"In 1969, the Wolverine State embraced a form of compulsory arbitration nearly identical to the one proposed by the EFCA (Employee Free Choice Act) to resolve disputes with its police and firefighters. Years later Detroit mayor Coleman Young who authored the original law as state senator - rued what he had done. "We now know that compulsory arbitration has been a failure," he lamented to the National Journal in 1981. "Slowly, inexorably, compulsory interest arbitration has destroyed sensible fiscal management and has caused more damage to the public service than the strikes it was designed to prevent."
Wow! That is a compelling argument from someone who wrote the law, implemented the law, and got to see and experience the after effects of this policy for years as a state lawmaker and later mayor of Detroit. One would think his opinion and insight on this issue along with others who have similar experience should be listened to. The article goes on to state that in a state wide vote in Michigan years later that 54% of state employees turned down compulsory arbitration and nearly every newspaper in the state was against it as well. Why? They saw how this policy drove many cities in Michigan into bankruptcy which led to massive layoffs where everyone lost.
"A 2006 task force convened by Gov. Jennifer Granholm, who supports compulsory arbitration, found that local government costs in arbitration states are 3-5% higher compared to non-arbitration states...Given the fact that local governments in Michigan alone spend over 23 billion annually, this works out to over a billion in extra spending for them."
So this policy costs Michigan over a billion a year in extra spending. What will this cost us if we implement this policy nation wide? If you want to learn more about the unions read this article.