Tuesday, February 22, 2011

The Case For The ‘Repair Bill’

    It is now more than a week since Wisconsin Gov. Scott Walker (R) introduced a so-called ‘repair bill’ to fix the state’s sorry finances.  This bill would make sharp cuts in a number of areas, including education and state worker pensions, but also, most controversially, would strip Wisconsin’s unionized public employees of the right to negotiate with the state on any topic other than wages.  The intervening week has seen protests on a scale unequaled even in Madison, a town that roiled in radicalism in the 1960’s.  Emotionally, my sympathies are entirely with the protesters—how could they not be?  But intellectually, it’s worth asking what can be said for the repair bill, not only as a step toward forming a judgment, but also to add to understanding what motivates the protesters. 
     The case for Walker’s bill can be summed up in one word: necessity.  The Governor estimates that Wisconsin faces a budget shortfall of $3.6 billion over the next two years.  For a state with a population of fewer than 5 million, this is a huge hole to plug.  Wisconsin has fiscal problems it shares with many other states.  The Affordable Health Care Act (a.k.a. Obamacare), for example, has saddled the states with a huge burden for Medicaid over the next several years.  The pension fund for the state workers is also underfunded, and if it were fully funded the result would be a major burden for Wisconsin taxpayers.  Health care is expensive, too, of course, and thus state employees are being asked to pay for more of their own coverage, too.  Even the move to bust the state employees’ unions can be justified on this basis, since (the argument goes) without this move the state will not have the flexibility it needs to deal with what might well be a fiscal crisis of several years.
     Philosophically, then, the argument for the repair bill is a garden-variety utilitarian argument: The overall consequences for Wisconsin voters of passing the bill will be better than the consequences of defeating it.  And it follows quite naturally that the workers who oppose it are defending their particular interests at the expense of the general welfare.
     Now, there are good reasons for doubting that the state’s budget situation is as severe as the governor maintains, and even more reasons to doubt that whatever problems there are will be solved by the repair bill.  But this is a philosophy blog, not a public policy blog, so the question I want to ask is, Even if everything presupposed in the above argument were true, would it still follow that it is unreasonable to oppose the bill? 
     No, it would not, because the utilitarian perspective is not the only possible way of looking at the situation in Wisconsin.  In order to understand the opposition to Walker’s proposals the relevant concept is, I think, the social contract.  Contractarianism is an idea that goes back to ancient Greece: The principles of justice in society arise through an agreement between the citizens limiting the power of each in order to gain the benefits of law (and, some would say, collective action).  On Thomas Hobbes’ view, at least, in the absence of such a contract, there is no justice, and thus also no injustice. 
     I will not say that a state of nature reigns in my native state—though if there were, I’m sure it would be friendlier and more polite than the nasty, brutish and short situation that Hobbes describes.  But the position of the protesters makes a lot of sense if we think of it as resulting from widespread suspicion that the social contract is not being honored, and thus that cooperation at one’s own expense is not reasonable.  The conflict we see there is a predictable consequence of the dramatic increase in economic inequality in America over the last 30 years, and it is precisely the chief danger of inequality that it undermines the social contract and makes it more difficult for societies to act collectively for the common good. 
     This increased inequality can be traced at least in part to economic trends beyond anyone’s control: As the labor market has become more globalized, the gap between high-skill and low-skill workers has grown.  But inequality in the US is also a creation of government policy, most particularly since 1980.   Trade unions, for example, are the most powerful tool lower-skilled workers have in negotiating for higher wages, but under Republican presidents, and to some extent under Clinton, too, the Federal government has been actively hostile to unions, and union membership has steadily sagged.  The minimum wage has fallen in real terms while taxes for the rich have been cut, and health care costs have been allowed to spiral out of control.  As a result, wages for average Americans have fallen, while the number of billionaires has spiked.  My own hometown of Janesville, once home to a comfortable middle class of unionized auto workers, has been deindustrialized as job prospects for local labor have disappeared with the town’s General Motors plant.
     This is crucial background for the standoff in Wisconsin.  The protesters surely do not think of themselves as being at war in a state of nature, where everything is allowed.  But they have good reason to reject proposals for the common good that harm them severely, and cannot be convicted of selfishness for this, for they have no reason to think that their government will act on their behalf.  What Walker proposes is just a Wisconsin-sized version of what Reagan did when he handed tax breaks to the wealthiest while busting the air traffic controllers’ union.  Indeed, before he proposed destroying the public employees’ union in order to decrease the budget, he increased that deficit by passing the tax cuts that Republicans seem to think heal all social ills.  It has also emerged that Walker's budget-balancing plan includes a provision for selling off state-owned energy facilities, which dovetails nicely with the interests of his financial backers, the Koch brothers.  Wisconsinites affected by the repair bill cannot kid themselves that the present state government is going to act reliably for the benefit of all, for this would stand in stark contrast not only to Walker’s own views, but to the broader policies that have defined the Republican Party since 1980.  Sadly, in the Age of Reagan, anyone who is willing to sacrifice for the common good, in expectation that others will do the same, is just a fool.
     By the way, one consequence of this analysis is that it is a mistake to distinguish, as most Wisconsin Democrats do, between the cost-cutting measures Walker has proposed and the union-busting measures.  Both are aimed at redistributing wealth upward, without a compensating benefit for those harmed.


  1. "The pension fund for the state workers is also underfunded, and if it were fully funded the result would be a major burden for Wisconsin taxpayers."

    With respect, this is actually not the case. Whereas many states and localities in the US seem to have pensions that are greatly under-funded, the pension in WI is actually about 97% funded. People who are part of the system (not tax-payers, in general) are making up the difference with a very small contribution. (This is not the 5.8% that Governor Walker is proposing.)

    -Larry, a friend of a couple of friends

  2. Thank you, Larry. As you can see, I didn't bother sourcing that claim, since I am just granting the Republicans their fiscal claims anyway and considering a different question. I'm happy to be corrected on this one, especially since members of my family depend on the WI state employees' pension fund!

  3. A more modern contractarian view, such as that of John Rawls, would emphasize that no contract can be binding unless citizens of all demographics could unanimously agree to the principles upon which social justice is based. All races, classes and other segments of a society would have to agree to the principles and for that reason, Rawls includes age as one of the factors hidden behind a 'veil of ignorance.'

    If the social contract winds up burdening future generations of a society with debt¹, since they would have to pay back the loans of their predecessors, than such an agreement would not likely be unanimously agreed upon in an initial situation or 'state of nature' and would not provide a viable basis for justice. It is to be expected that citizens feel they have received a raw deal from society, but the perception of injustice does not mean a violation of the social contract has occurred.

    I have found difficulty with the argument that a large income gap corresponds to injustice between classes, a poor economy or any other substantial problem. Since disparities can occur for numerous reasons it is hard to isolate why a gap would increase or decrease. Further, if high-income households do not become richer at the expense of the low-income households it seems to me that a rising income gap is not necessarily a bad thing.
    ¹I'm assuming, with you, that public worker pensions and benefits are, in fact, a contributing factor to Wisconsin's money problems.

  4. Patrick,

    to take your last point first, I think there are plenty of reasons why growing economic inequality is a bad thing, even if the incomes of the poorest are increasing along with those of the richest (which, by the way, they are not: http://en.wikipedia.org/wiki/Income_inequality_in_the_United_States). First, there is some empirical evidence that inequality lowers the overall happiness of a population (admittedly, this is disputed, though). Second, inequality can make social cooperation more difficult-- which is actually the point I'm making regarding Wisconsin.

    But more broadly, there is more than a mere 'perception of injustice' here. To put it in philosophical terms, it is commonplace to believe that outcome ought to be tied in some way to desert. But the huge gains in income and wealth made by the wealthiest Americans over the last 30 years or so, and the steady declines among the poorest, cannot, I think, be plausibly said to be tied to desert-- unless we're to believe that the top 1% have just gotten dramatically smarter, more talented, or harder-working than they had been previously. The changes seem to be tied instead to changes in the economy, but also to changes in government policy, namely declining government support for the few measures that ameliorate inequality.

    My point is not that the social contract has been violated. Most contracts, especially social contracts, can withstand the occasional violation and still retain their force. My point is that it is increasingly plausible to see Republican policy as executing an all-out war on the working class. This is just the sort of thing that, on any contractarianism, the social contract is meant to prevent.