If we can prevent the government from wasting the labors of the people under the pretense of taking care of them, they must become happy. — Thomas Jefferson

Biased Labor Institute Deserves a Budget Cut

Suppose California taxpayers had given the California Chamber of Commerce $25 million since 2000 to improve its membership recruitment and produce phony “studies” backing its priority legislation. One would expect outraged state legislators to single out this kind of unnecessary government spending as an obvious budget cut to reduce multi-billion-dollar budget deficits.

In fact, state taxpayers have spent almost $25 million in the past five years to subsidize the membership recruitment and research operations of a special interest group. This group is not the Chamber, of course – it’s labor unions.

At the behest of the California Labor Federation, the legislature created the Institute for Labor and Employment (ILE) at the University of California as part of the enormous state government bloat during the second year of Gray Davis’s administration. Since then, the ILE has used taxpayer funding and the University of California name to promote the union agenda to elected officials, the media, and the public.

The ILE has an advisory board of state labor union leaders. It hosts conferences and seminars to train union organizers. It funds research projects such as “How to Make People Pro-Union.” It sponsors summer internships for college students to work on union organizing campaigns. In its most public role, the ILE churns out methodologically flawed studies with pre-ordained outcomes that uncritically support union positions on legislative issues at the state and local level.

California voters saw a report from the ILE against Wal-Mart cited in campaign advertising last fall in support of Proposition 72, a referendum that would have established a state-mandated health care system paid for by businesses. The ILE relied on information about the company’s health benefits obtained from old lawsuits, but never contacted the company to check the information. Now the ILE has begun another study of Wal-Mart’s impact on the economy, and the biased conclusions can be predicted.

In another case of typically flawed ILE scholarship, UCLA found in 2003 that the ILE violated the university’s internal review process when it conducted research for a study on the earnings of casino employees during a union-organizing campaign. A scientific consulting firm refuted the study’s conclusions because researchers did not consider tips and overtime.

According to the U.S. Bureau of Labor Statistics, unions represent only 16.8 percent of California workers. Yet state legislative leaders continue to insist that everyone should fund the ILE, apparently so that unions can spend their money on other activities, such as elections and union organizing.

Governor Schwarzenegger recognized the inappropriate spending on the ILE when he cut $2 million from the program as part of unilateral spending cuts in December 2003. His original 2004-05 budget eliminated taxpayer funding for the program. Yet the political power of unions remains strong in Sacramento, and Democrat legislative leaders successfully pressured the governor to restore $3.8 million for the ILE as part of last year’s budget deal.

Now the governor has again proposed eliminating taxpayer funding for the ILE in his 2005-06 budget. With a looming budget deficit, this should be the year state legislators stop spending taxpayer money on the political propaganda of labor unions.

About PRI
For more than two decades, the Pacific Research Institute for Public Policy (PRI) has championed individual liberty through free markets. PRI is a non-profit, non-partisan organization dedicated to promoting the principles of limited government, individual freedom, and personal responsibility.