STUMP » Articles » Janus Clawback: Follow the Money » 19 July 2018, 22:35

Where Stu & MP spout off about everything.

Janus Clawback: Follow the Money  

by

19 July 2018, 22:35

Before I get to the money, let’s see what Bill Bergman says about the Janus decision:

They are all “Right To Work” states now

July 3, 2018

Truth in Accounting includes a “Right to Work” variable in our State Data Lab website. It identifies states characterized as “Right To Work” by the National Right To Work Legal Foundation.

This week’s U.S. Supreme Court decision in the Janus vs. AFSCME case will force us to update our database. Now we have to switch all the identifiers to “Right To Work.”

Ah, the importance of keeping databases updated.

That said, all of the states may be “Right to Work” re: public employee unions, on paper. The various state politicians may make it extremely difficult to exit, though. That’s for the future.

I WANT MY MONEY BACK

So now after the Janus decision, various groups are trying to claw their money back.

Supreme Court Fallout: Calif. Teachers Sue Unions to Recoup Unconstitutional ‘Agency Fees’

Justice is coming for unions that forced non-members to pay “non-political” agency fees that went to prop up Democratic candidates. Last month, the Supreme Court ruled that forcing workers who disagree with a union to make these payments anyway violates the workers’ First Amendment rights.

Less than a week after that ruling, Janus v. Association of Federal, State, City, and Municipal Employees (FSCME), seven California teachers have filed a class-action lawsuit to recoup unjustly forced fees.

“This lawsuit will enable teachers like me to recover the agency fees that we were wrongly forced to pay against our will,” Scott Wilford, the plaintiff in the new lawsuit, told Education Week. Wilford filed the lawsuit in the Central District of California’s federal court on Tuesday.

I have no idea how that one will shake out, and I really doubt I’m going to get my agency fees back from my years at UConn, but it should be interesting to see what happens.

I agree with the person that there will be problems with making retroactive application of Janus, but again, we’ll see.

A JANUS-PUBLIC PENSIONS LINK?

(No, not really, but let’s go on this stupid journey)

From that well-known intellectual powerhouse Slate: How the Janus Ruling Might Doom Public Pensions Next

The Supreme Court’s decision to overturn 40 years of settled law in Janus v. AFSCME was surely bad news for organized labor.

The ruling may be similarly bad news for public pensions.

To understand why, consider the hypothetical case of a police officer who, like most, works in a unionized workplace. Let’s say that this officer doesn’t like body-worn cameras and really doesn’t like that his union is negotiating to increase their use. He resents that a “fair-share fee” is deducted from his paycheck to fund these negotiations.

Thanks to Janus, he no longer has to pay his union anything (even though he is still covered by a union-negotiated contract—and the union must continue representing him).

But on the next line of that same paycheck, there remains another, far larger, mandatory deduction: a contribution to his public pension. And it may well be that his pension money is invested in a company that manufactures body-worn cameras. This company lobbies for these cameras, supports politicians who promote them, and advertises their advantages—in sum, like the union, it uses Officer X’s money to express views he opposes.

If our police officer cannot be required to “subsidize private speech on matters of substantial public concern,” as Justice Samuel Alito wrote in Janus, why does this protection stop with his union fee? Why does it not also extend to his pension?

Let’s stop right here.

I am not a lawyer, so I’m not going to try to address any of the legal issues here. The author of the piece is an attorney…who specializes in public relations, evidently. I’m not sure she can really speak to constitutional matters, either.

The article gets into a real mess soon after that, switching to irrelevant topics in terms of “But unions are really great!”

Really? What union are you in — a union of Slate columnists? That still has nothing to do with First Amendment issues re: Free Speech, and if you want to argue Freedom of Association… well, if a person doesn’t want to associate, I’m pretty sure the First Amendment says they don’t have to.

But let’s jump back in later in the piece, where she is really undercutting so many public pension divestment schemes out there:

Janus suggests that a public employee could withhold payment to a pension plan because of a First Amendment dispute—notwithstanding the employee’s own status as beneficiary. Even if states were to move to deny benefits to those who don’t contribute (as some may now try to with unions), pension funds would still face potentially destabilizing withdrawals.

Funny that. You would think that the money paid in by the employees would be there for covering their own benefits, right? You cut the benefits if they withdraw the assets backing that benefit, right?

Seems to me that what would doom public pension funds in this case would not be because people could withdraw money that is supposedly theirs. IT’s because they set up fundamentally unsound benefits and funding mechanisms… including DELIBERATELY SHORTING THE PENSION FUNDS FOR DECADES.

You think Janus is a danger to public pension funds? How about a court case against newer tiers in pensions where employee contributions are much more than their normal cost, and are paying for the benefits… OF CURRENT RETIREES. That’s the situation in the worst-funded public plans in the U.S.

But back to this idiocy:

There is also something troubling in any suggestion that employees who do not wish to subsidize corporate speech on public matters should simply forgo their pension. After all, the court could have held that Janus was not injured because he could have always found a different job in a nonunionized workplace. But it did not, presumably because the justices don’t think that an employee seeking to exercise his or her First Amendment rights should bear such a cost for doing so.

Oh the “well, if you want to have a job, you have to be a union member” that’s so popular… oh wait, it’s not. It’s popular only among union members, who can then keep the riff-raff out and go rent-seeking a-plenty.

Later down:

And yet pension funds have massive clout. The nation’s largest public retirement systems hold more than $3 trillion in assets. The roughly 15 million active members of defined-benefit plans at the state and local levels are typically required to contribute between 6 and 8 percent of their salary to their pensions—in most cases, an amount several times greater than the agency fee at issue in Janus. In contrast to the 1950s, when 96 percent of state and local pensions were in fixed assets or cash, today 50 percent or more of public pensions are invested in companies that engage in all manner of expression that, even putting aside purely “political” speech, affects “matters of substantial public concern.”

There are, of course, very good reasons to require public employees to contribute to a pension—much as there were sound reasons supporting union agency fees. But as Justice John Roberts memorably explained in his confirmation hearings, courts are meant to apply the law evenly, not to baldly pick winners and losers.

Oh look there. The pension funds are the ones with the clout, not really the corporations. Supposedly.

And shall we look at how various pension funds are playing the divestment game… supposedly on behalf of the pension participants?

Tell you what. Why don’t you come back with an article about why blanket divestment is a dangerous policy for pension plan solvency, or why current employee contributions shouldn’t be going to pay for the benefits of those who retired 20+ years ago.

Solidarity with somebody getting better benefits than you and got to retire at age 50? Yeah, let me know how union solidarity is working now.

OTHER JANUS COMMENTARY

END NOTES

I am not pro-union, I am pro-guild. (If you don’t know the difference, don’t worry about it right now) I’m not anti-union for other people, but I know I’m the kind of person who gets screwed in a union set up, and I’m not interested in having two sets of bosses.

But the “bright side” takes – that Janus will get rid of the political power of public employees – is absurd.

First off, the states where the political power of the public employees has caused fiscal instability… their power will remain even if there’s no explicit union.

Secondly — for the worst states (ahem, Illinois, Kentucky, New Jersey, and California) in terms of public pension problems — those liabilities are already accrued. Getting rid of those unions won’t do a damn thing for the already existing liabilities.

So. Enjoy your “win”, I suppose. But it won’t do a damn thing about current public pension solvency.