Government unions and wasteful spending

A look at self-reported government union spending reveals budgets fraught with waste. Unions exist to represent workers, so that’s where the bulk of their money should go. Yet among the state offices of the four largest government worker unions, the portion of spending that goes to representation ranges wildly, from nearly $0.60 out of $1...

A look at self-reported government union spending reveals budgets fraught with waste.

Unions exist to represent workers, so that’s where the bulk of their money should go. Yet among the state offices of the four largest government worker unions, the portion of spending that goes to representation ranges wildly, from nearly $0.60 out of $1 at the American Federation of State, County and Municipal Employees, to less than $0.08 per dollar at the Service Employees International Union, or SEIU. If you combine the four groups, you get a total of just more than $0.40 for every dollar.

Where does the rest go? More than half goes into administration and overhead, which for most non-profits is considered a horrible amount. While donors should have realistic expectations, extremely high overhead costs should still be a red flag. The Better Business Bureau recommends that overhead and administration should make up less than 35 percent of total spending, while the U.S. government’s Combined Federal Campaign, which facilitates charitable giving by the federal workforce, places special conditions on charities with overhead spending of more than 25 percent.

By this standard three out of four unions have high administrative and overhead costs. As you’ll see, the one exception, SEIU, has other problems.

If anything, the unions should be able to put more into their core program (that would be representation) than most charities, because with dues guaranteed they simply do not have the fundraising challenge that just about every other nonprofit faces.

SEIU is noteworthy in that it manages to spend little on representation, but its overhead costs are modest. That’s because the union spends $0.63 out of every dollar on politics and lobbying that overwhelmingly favors the Democratic Party. That might not be waste, at least from SEIU’s point of view, but that’s not the sort of organization that government employers should be supporting.

AFSCME, SEIU, Illinois Education Association and the Illinois Federation of Teachers alone take in more than $70 million every year, and much of that money goes to bloated operations. (And sometimes to very generous staff salaries as well.) But the truth is these unions could do their representation work on much less money than they get. And even if you place a high value on union representation, there is no need for government to guarantee union dues.