Public employee unions and the privatization of “public” services

Public sector unions are strongly opposed to contracting with the private sector for the production of goods and services. Economic theory indicates that because of incentives the private sector should be much more efficient that the public sector — a proposition verified for numerous activities of state and local governments. This paper examines evidence at the federal level to show that substantial cost savings can be achieved by contracting out in that sector as well.     

The Allocation of Black Workers into the Public Sector

Abstract

This study examines the effects of individual and structural factors on the odds that a black worker will be employed in the public sector (federal or state-local government) rather than the private sector. The independent variables include human capital, gender, citizenship, and the structural features of the labor markets (metropolitan areas) in which these workers reside (percent black, residential segregation, geographic region). The study focuses on percent black and residential segregation, two variables which significantly influence discrimination, group power and the employment opportunities of black workers. Logistic regression shows that, controlling for other factors, the odds of black employment in the public sector are highest in metropolitan areas that have large black populations and relatively low levels of residential segregation. These findings indicate that the allocation of black workers into the public sector results from processes of both discrimination and group power. The implications of the findings for the future prospects of black Americans to advance economically through public sector employment are discussed.     

The future of public sector unionism in the United States

The future of nonpublic safety, non-teacher, non-federal public sector unions is bright. As a result of past success, the unions, led by AFSCME, have an organizing culture and sufficient power within the sector to maintain and increase density. However, the challenges that lie ahead in the 21st century will surely test the strength of AFSCME and the other public service unions. The large gains in public employee membership achieved in the last third of the 20th century are not likely to come with the relative ease with which they were achieved during that period. The remaining unorganized workers are in locations and occupations that have not been historically fertile ground for unions, public or private. In addition, the threat of privatization of jobs requires public unions to re-think their traditional strategies and organize in the more hostile private sector while simultaneously protecting the public sector from attacks. The public sector unions recognize that they have a tenuous grasp on their relatively strong position and must organize to maintain and strengthen their position. Absent dramatic changes in federal private sector labor law, and adoption of numerous public sector labor laws, the resources necessary for organization will be tremendous. The future is bright for the public sector unions only because they have demonstrated a willingness to adapt to change, make sacrifices, and deploy sufficient resources to achieve growth. The views herein are the author’s and do not necessarily represent the views of AFSCME.     

Big Food,Nutritionism, and Corporate Power

Big Food corporations have capitalized on nutritionism—the reduction of food’s nutritional value to its individual nutrients—as a means by which to enhance their power and position in global processed and packaged food markets. Drawing on the literatures on nutrition and corporate power, we show that Big Food companies have used nutritional positioning to bolster their power and influence in the sector. Through lobbying and participation in nutritionally focused public–private partnerships, they have directly sought to influence policy and governance. Through market dominance in the nutritionally enhanced foods sector, and participation in nutrition-focused rule-setting activities in agrifood supply chains, they have gained power to influence policy agendas. And they have used public outreach and the media to present their views on the nutritional aspects of their products, which shapes public perceptions and the broader regulatory environment. Together, these strategies have enhanced the power of Big Food firms to influence policies in the food sector.     

When government used publicity against itself: Toledo's Commission of Publicity and Efficiency, 1916–1975

In early 20th century America, the Progressive Movement sought to fight corruption and graft in city governments through publicity. The usual approach was to establish a nonprofit bureau of research or efficiency that would investigate city government and publicize the results. However, in Toledo (OH), that bureau was a government agency and was also publisher of the official city gazette. Was the public sector affiliation of the Toledo Commission of Publicity and Efficiency a fatal flaw? This inquiry concludes that the Toledo bureau was as effective as its nonprofit counterparts. Contrary to the dogma of Progressive Era reformers, a public agency dedicated to reform could successfully use publicity against its own government to accomplish reform.     

Neo‐liberal reform,the public sector and Black–White inequality

In this article, we offer an overview and critical assessment of recent changes wrought by “new governance” reforms within public sector work, highlighting the implications specifically for Black–White inequality, and denote where further sociological analyses are warranted. These foci are important given the widely accepted—though hardly comprehensively examined—assumption that public sector employment remains a favorable “economic niche” for African Americans. Recent sociological research, including our own, suggests that this is likely no longer the case. The very structure and functioning of public sector work have changed owing to neoliberal agendas and reforms toward privatization over the last two decades, becoming less bureaucratic and increasingly mirroring processes and inequalities more traditionally characteristic of the private sector. We emphasize the consequences particularly for African Americans and call for deeper sociological analyses of public sector racial inequalities, processes, and their consequences.     

Briefly Noted

In “Guidance on Strategies to Promote Best Practice in Antipsychotic Prescribing for Children and Adolescents,” a 54‐page document from the federal Substance Abuse and Mental Health Services Administration (SAMHSA) released this spring, the federal government synthesizes the state of evidence in systems‐level strategies to promote antipsychotic best practice prescribing for young people. In response to safety concerns, federal, state, and public‐sector agencies have already invested in strategies to monitor prescribing and to support best practices. For Medicaid, since 2014 this is done by prior authorization, in which prescribing clinicians must receive approval for dispensing antipsychotic medications to youth. The document from SAMHSA is based on data collection and consensus building. Its goal is to provide a centralized resource for public‐ and private‐sector decision‐makers, prescribing clinicians, service providers, commercial insurance companies, and youth and their families. Identified strategies reviewed in this guidance include.     

How has public policy shaped defined-benefit pension coverage in Canada?

Unlike federal regulation in the United States, variation in provincial regulation across Canada provides a natural laboratory to examine the impact of public policy on pension coverage. Using data from a nationally representative sample of private sector workers in Canada in 1994, we find that higher marginal taxes, earlier vesting, and more permissive eligibility rules increase coverage, while a ban on mandatory retirement has a negative, but insignificant effect. Implications for differences in defined-benefit coverage between Canada and the United States, and pension theory, research, and practice are discussed.     

An institutional approach to research on public procurement of innovation

The role of public procurement as a means to stimulate innovation has been increasingly emphasized during the last few years. The general argument is that, by applying intelligent demand, public agencies can stimulate private sector innovation that will eventually sustain competitive advantage in a global economy. The emphasis on public procurement used as an innovation policy instrument challenges current institutional practices and skills. The article is based on the assumption that the innovation research community could inform this policy discourse, in particular by drawing on institutional theory, but in order to fully utilize this potential, further revision of the research perspectives seen is needed. The article therefore discusses an institutional approach based on three modes: “multilevel institutional analysis”, “endogenous and exogenous institutions” and “institutions as rationalities”, arguing that such an approach would help to increase innovation research quality and policy relevance.     

Factors Contributing to the Size of Nonprofit Sector: Tests of Government Failure,Interdependence, and Social Capital Theory

Based on the county-level longitudinal data in the USA, this study finds that racial diversity is positively associated with the nonprofit sector size. We further find that the share of children below poverty level is negatively associated with the size of nonprofit sectors. Our findings support the government failure theory. Random effects models also show that federal funding and local funding are positively associated with the size of nonprofit sectors, which confirms interdependence theory. Lastly, we do not find statistically significant relationship between social capital—measured by the number of associations—and the nonprofit sector size.     

COMPARING MONOPOLY AND COMPETITION: THE INCREASING-COST CASE

When an increasing-cost competitive industry becomes monopolized, the monopoly will possess some monopsony power in input markets. This paper presents a simple analysis comparing the performance of monopoly and competition in this case. It first assumes fixed input proportions, and then turns to the general case of variable input proportions. With variable proportions, it is shown that the monopoly's marginal cost curve lies above the competitive supply curve but the monopoly's average cost curve lies below it. The welfare cost of monopoly is not identified by the area between the monopoly's marginal cost curve and the demand curve in either case.     

Two faces of union voice in the public sector

Summary and Concluding Observations Employee voice through unions is manifest in various ways in the public sector including unionization itself, strikes, political activity, and challenging managerial prerogatives. In each of these areas there are two faces to voice just as there are two faces to unions. Voice can be used in a more influence-peddling and muscle-flexing bargaining fashion to enhance rent seeking and noncooperative behavior with negative effects on productivity, competitiveness, and resource allocation. Voice can also be used more positively by articulating preferences and trade-offs, improving communications, and involving employees and enhancing their commitment to the organization. In all likelihood both faces of voice apply to unions in the public sector just as they do in the private sector. In the private sector, however, the negative monopoly face of unions has been increasingly constrained by competitive market forces such as globalization and trade liberalization as well as by the industrial restructuring to services and the information economy. Rents are obviously harder to obtain when there are fewer rents on the bargaining table. There is little survival value to pricing yourself out of the market now that market forces are more prominent. In such a private sector environment, unions have generally declined, strikes have dissipated, and managerial prerogatives have been enhanced.     

Exclusive representation in public employment: A public choice perspective

Public sector unionization has grown rapidly in recent years, and research has suggested that among the reasons for such growth is legislation granting special privileges to public employee unions. This paper examines one form of legislative privilege, exclusive representation, from a public choice perspective. It is shown that exclusivity reduces employees’ freedom of choice, increases the welfare of union leaders at the expense of union members, limits employment opportunities to “outsiders,” entrenches the monopoly provision of public services, and generates conflict and instability in labor relations.     

Social Economy and Home Care Services in Quebec: Co-Production or Co-Construction?

Third sector organizations have always played a significant role in the supply of home support services in Quebec, but this supply of services attained a crucial development phase in 1996, with the creation of 100 or so domestic help social economy enterprises (DHSEEs). These DHSEEs complemented the supply of public services delivered by the Quebec state, thus de facto taking part in the dynamics of co-production of services in the context of a mixed economy including the third sector. However, beyond that co-production, these enterprises also have to position themselves in a process of co-construction with the state, that is, in the joint, partnership-oriented construction of public policy, which provides the framework for their participation in services of public interest. Analysis of this public policy thus shows that the situation of DHSEEs in Quebec has swung, depending on the period, between co-production and various types of co-construction. A number of restrictive budget policies and subcontracting practices adopted by the Quebec state, along with tensions among DHSEE groups, curtailed the development of a genuine co-construction process during the 2000s.     

Privatisation Results: Private Sector Participation in Water Services After 15 Years

Privatisation of public infrastructure has been the mantra of many development agencies since the late 1980s. Water supply is no exception, and various forms of private sector participation (PSP) have been tried in the water and sanitation sector. This article examines the results of these experiments. It suggests that PSP has had mixed results and that in several important respects the private sector seems to be no more efficient in delivering services than the public sector. Despite growing evidence of failures and increasing public pressure against it, privatisation in water and sanitation is still alive, however. Increasingly, it is being repackaged in new forms such as that of public‐private partnership.     

The power reinforcement framework revisited: mobile technology and management control in home care

Whereas digital technologies are often depicted as being capable of disrupting long-standing power structures and facilitating new governance mechanisms, the power reinforcement framework suggests that information and communications technologies tend to strengthen existing power arrangements within public organizations. This article revisits the 30-year-old power reinforcement framework by means of an empirical analysis on the use of mobile technology in a large-scale programme in Danish public sector home care. It explores whether and to what extent administrative management has controlled decision-making and gained most benefits from mobile technology use, relative to the effects of the technology on the street-level workers who deliver services. Current mobile technology-in-use might be less likely to be power reinforcing because it is far more decentralized and individualized than the mainly expert-dominated and centrally controlled technologies that were the main focus of the 1970s and 1980s studies. Yet this study concludes that there is general support for the reinforcement framework in the contemporary application of mobile technology in public sector home care.     

An economic analysis of public sector collective bargaining and strike activity

This paper develops a theory of public sector collective bargaining and uses it to investigate the economic determinants of public sector strike activity. The model considers union leaders, union members, bureaucrats, politicians, and voters, with the intention of explicitly recognizing both the constraints placed on the bargaining parties by their constituents and the differences between public and private sector collective bargaining. The empirical results indicate that only in cases where both negotiating parties are motivated by self-interest can we expect frequent strikes and strikes of long duration. The results also suggest that public sector strikes are countercyclical and principally influenced by the business cycle and its impact on state and local revenues.     

Paperwork and bureaucracy

This study explores paperwork as an inherent characteristic of bureaucratic behavior. The magnitude and scope of the federal government paperwork burden on the private sector is given particular emphasis. A theoretical model of bureaucratic behavior is developed which shows that bureaucrats employ paperwork to shift the cost of agency functions to the private sector in order to increase their perquisites of office. The model indicates that, if the private sector were compensated for the federal paperwork burden, agency employment would be smaller, as would agency output and the volume of private-sector labor expended in preparing federal forms.     

The federal Public Relations Administration: history’s near miss

Given the permanent hostility by Congress to public relations in public administration at the federal level of government, it is surprising how close the federal government came to establishing a wartime agency, entitled the Public Relations Administration (PRA), as part of its administrative structure in World War II.During the interwar years (1918–1941), the civilian and military leadership of the US engaged in elaborate planning for a possible future war, including recommending the creation of a superagency called the PRA. The 1933 version of the Industrial Mobilization Plan (IMP) submitted to Congress by the Army and Navy was the high water mark of institutionalizing public relations in public administration. This one-time opportunity to legitimize and professionalize public relations by the federal government was lost due to the opposition of President Franklin Roosevelt in 1939. This article relates how that planning effort unfolded and the factors that led to its stillbirth.     

THE EFFECT OF COMPETITION ON CAPACITY UTILIZATION IN THE ELECTRIC UTILITY INDUSTRY

Theory predicts that the combined capacity of two competing utility firms will be greater than the market requires and excess capacity will result. This study tested a set of monopoly and a set of duopoly electric utility firms and found that the outcome predicted by theory did not occur. Even though the duopoly firms did face more downward pressure on capacity utilization than the monopoly firms, the difference was not statistically significant. These results reveal that public policy decisions, predicated upon assumptions that combined capacity of two competing electric firms would be greater than the market requires, should be re-examined.