Study Shows Card Check Bill Will Seriously Damage U.S. Economy

As reported exclusively on these pages last week, Union pension plans are in much worse shape than people feared. In fact, Moody’s September 2009 report measured 133 union pension plans. Out of the total 133 only 25 union pension plans are adequately funded, 43 of them are between 65-79% funded that classifies them as endangered. The remaining 65 union pension plans, one out of every two measured, are underfunded at a critical rate, less than 65%. For the full list click here.

The proposed card check bill, which will allow unions to dramatically increase their rolls by eliminating the secret ballot and replacing it with worker intimidation may be the only thing that will prevent union leaders from  getting "A one-way ticket to Palookaville." But this study released earlier this week shows the bill that contains card check called The Employee Free Choice Act will do terrible damage the the United States Economy.

An analysis by Anne Layne-Farrar of LECG Consulting created a study called An Empirical Assessment of The Employee Free Choice Act: The Economic Implications. 

The quantitative analysis (embedded below) finds that card check will achieve the Union Goal of to increasing union membership (and getting hundreds of new payees into the cash-strapped pension fund Ponzi-scheme). On the other hand, the analysis indicates that passing the Employee Free Choice Act would probably the US unemployment rate and decrease US job creation substantially. Based on existing scales for every 3 percentage points gained in union membership through card checks and mandatory arbitration, the following year's unemployment rate is predicted to increase by 1 percentage point and job creation is predicted to fall by around 1.5 million jobs.

If EFCA passed today and resulted in an increase in unionization from the current rate of about 12% to 15%, then unionized workers would increase from 15.5 to 19.6 million while unemployment a year from now would rise by 1.5 million, to 10.4 million. If the Employee Free Choice Act were to increase the percentage of private sector union membership by between 5 and 10 percentage points, as some have suggested, the report indicates unemployment would increase by 2.3 to 5.4 million in the following year and the unemployment rate would increase by 1.5 to 3.5 percentage points in the following year.

But the Union leadership keeps pressing the Democratic party to pass their "life preserver"  despite the fact that it will hurt the economy.

Frustrated at seeing their legislative agenda stymied, unions are becoming increasingly active in competitive Democratic Senate primaries.

Across the country, labor groups are using their organizational muscle early against candidates whom they see as having walked away from their agenda.

By doing so, they’re exposing schisms between centrist and liberal Democratic lawmakers who have struggled to come through on the campaign promises made to union members. The Employee Free Choice Act (EFCA), healthcare reform and even a nominee to the little-known National Labor Relations Board have stalled in a Congress controlled by the largest majorities Democrats have enjoyed in a generation.

“We can’t get anything done for the people that we represent,” said Gerry McEntee, president of the American Federation of State, County and Municipal Employees. “We are taking a new tack. This a new day. We are going to play in the primaries.”

.....The Pennsylvania chapters of the AFL-CIO and the Service Employees International Union (SEIU) both say they will endorse a candidate in the Senate Democratic primary, perhaps as early as this weekend. And McEntee predicted unions will pick a Democratic primary candidate in the Ohio and Kentucky Senate races as well.

“Labor’s back,” said Harley Shaiken, a professor at the University of California-Berkeley. “We’re seeing a labor movement that has more confidence and is more energetic than it’s been in a long while when it comes to politics.”

“We’re tired of being taken for granted,” said Alan Hughes, president of the Arkansas AFL-CIO. “It’s like, ‘We want your help to get elected, we want your money, we want the ground workers,’ but when it comes time to [act on the union’s priorities] … they’re not listening.”

Hughes’s union has gotten behind the Democratic challenger to Sen. Blanche Lincoln (D-Ark.), Arkansas Lt. Gov. Bill Halter.

“If you really were dissatisfied with Blanche Lincoln, you might not be enthusiastic about supporting her but you wouldn’t mount a full primary challenge with $4 million from four key unions,” he said.

Weighing into a primary fight isn’t new territory for labor, he added. “What’s new is this ability and scale and energy with which labor’s doing it.”

The Employee Free Choice Act is a trade-off. Like so many other of President Obama's preferred policies, it helps one of his favored pieces of the American Population but seriously damages the majority.  In this case it is the 80+ percent of the population not part of a labor union being sacrificed to cover up the mistakes of the Union Leaders.

The full study is  embedded below:

efcaStudy_layneFarrar