Mayor Zohran Mamdani of New York, in his inaugural address, offered a pledge to create a government “where excellence is no longer the exception.” He now must do so while closing a $5.4 billion deficit, in a state where the governor rejects higher taxes on the rich.
Big budget gaps are not uncommon in American cities. Nor is New York’s high cost of living — one reason that California, New York and Illinois top the list of states with declining populations over the past five years.
If blue-state governors and mayors want to get serious about delivering excellent public services, they will need to do more than battle billionaire elites or embrace abundant housing and energy.
They will have to push back against a core constituency within the Democratic Party that often makes government deliver less and cost more: unions representing teachers, police officers and transit workers.
Democrats have long accepted inefficiencies as the price of support from public sector unions, and this may seem the worst time to demand better. Confronted with the president’s cruelty and lawlessness, the unions have been inspiring: defending wrongly fired workers, fighting federal overreach and organizing against ICE brutality.
But it’s precisely because of increasing authoritarianism that Democratic governors and mayors need to show the public that they can deliver. With the president weaponizing budget cuts against blue states, there is little room for error. Democrats need a new bargain with public sector unions — one that respects their voices and livelihoods but puts public services first.
Begin with the cost of government. Blue-state and blue-city voters pay higher taxes. More than half of city and local government expenditures (and 20 percent of state expenditures) are paid out to employees. These blue states and cities often also pay state and local government workers more than similar jobs pay in red jurisdictions, even after adjusting for the cost of living.
Much of this gap is tied up in pension benefits. Workers generally value higher wages today more than retirement guarantees in the future. But pensions are attractive to politicians who pass future costs to future taxpayers. And it is the job of unions to fight for the largest benefits they can.
Working people should be financially secure in retirement, and government must pay competitively to attract a strong work force. The question is whether one segment of workers should retire with greater security than others, at the expense of services that the public depends on.
Consider Gov. J.B. Pritzker of Illinois. A fearless opponent of Donald Trump, his bravery failed him when Chicago police and firefighter unions sought to raise pensions, often by thousands of dollars. Against the advice of civic and business leaders concerned about, as they put it, “grossly underfunded pensions,” Mr. Pritzker signed legislation that partly undid a 2010 attempt to rein in benefits for new employees.
The new law will cost the city $60 million next year — more than enough money to cover the city’s summer job program — before ballooning to $11 billion over three decades. Because of Illinois’s Constitution, the commitments cannot be reversed.
Or consider Mayor Karen Bass of Los Angeles. Having won a tough election with union support in 2022, Ms. Bass gave public employees substantial raises, celebrated by local unions as the largest in city history. Those raises helped blow a $1 billion hole in the budget, in response to which she proposed to cut important services, including those for the homeless. The city avoided layoffs only by reducing paid work hours for city employees, including police officers. Paying city employees more money for less work is not a win for the public.
Mayor Mamdani will soon have to settle his own labor contracts. He and Gov. Kathy Hochul are offering a sensible proposal to expand child care, but there’s no plan to pay for it beyond two years.
Mr. Mamdani’s push to cut wasteful contracts will help, but in a budget that’s more than half payroll, his only path will be a hard bargain with labor. New York is nearly unique in providing zero-premium health plans. The city also offers robust traditional pensions, which Mr. Mamdani (and his primary competitors) endorsed expanding at a union forum last year. If the city already had defined contribution plans with a solid match, as is common in the private sector, it would spend about $4 billion less each year — about half the cost of a universal child-care plan. Workers are entitled to what they’ve earned and a secure retirement. But without any changes to benefits, excellence will be out of reach.
Another thing that makes government less effective: It is incredibly hard to fire blue-state public employees who are awful at their jobs. Police officers who use excessive force are regularly reinstated under the arbitration procedures that unions have fought for; one Florida study suggests that collective bargaining leads to higher levels of police abuse.
Outdated laws can also make it exquisitely hard to hire good people into government. Baroque rules stretch the government hiring process for months, leaving empty roles that would make the cities and states more affordable, like officials who could approve more housing permits. When the last New York City mayor sought to make sensible reforms, the city’s unions sued, and he caved.
Unions also resist technology that could save money and improve lives. They’ve secured laws that forbid using A.I. to make government more efficient, won contracts requiring union consent before autonomous buses can roll out and pushed legislation requiring trains to have two-person crews, when many of the best trains worldwide have zero.
Everyone worries what A.I. will mean for the labor market, but blocking technology in government while it transforms everything else offers no safety. Uber and Waymo will grow while public transit staggers. It is a prescription for fury at government, not investment in it.
Finally, the most obvious case: public education. Deference to labor proved a particular problem in the pandemic, when Democrats kept schools closed long after businesses had reopened, long after it was clear that Covid rarely hurt children and, in some cities, long after vaccines became available. School districts with stronger teachers’ unions kept kids out of the classroom longer. It’s one reason students in blue areas lost more ground academically.
In fact, in American public education’s dismal last decade, it is red states with weak unions and stronger centralized control — states like Mississippi and Louisiana — that offer good news. Fourth graders in these states now read slightly better than students in California and New York, which spend far more per pupil and have lower child poverty rates. Another positive outlier is the District of Columbia, which offers $27,000 raises to help retain great teachers.
New York City could have a program like D.C.’s. Instead, it has a union-backed class size reduction law that will spend billions to hire thousands of teachers. The evidence indicates this can be cost effective for young children, particularly in poor schools, but this law applies across all grades and neighborhoods. The law is driving money into less needy schools, even elite high schools, and risking an exodus of good teachers from poor areas. Meanwhile, the city provides rigid teacher pay that rewards often useless master’s degrees, while leaving teachers who are failing their students in the classroom.
Why are Democratic leaders so quick to take positions that clash with the public good?
An important study released last year found that endorsements from influential groups matter much more than we previously understood. In primary elections, voters depend on those endorsements to distinguish between otherwise-similar candidates from their own party.
In the many places across the country where general elections aren’t competitive — especially big cities, which are Democratic bastions — those primaries are the whole ballgame. As a result, candidates spend a lot of time courting the interest groups that can give them those coveted endorsements.
You can see this dynamic right now. Last month, Ms. Bass, the Los Angeles mayor, won a primary endorsement from the American Federation of State, County and Municipal Employees, and that may prove critical now that she faces a surprise primary challenge from her left. Mr. Pritzker is cruising to re-election in November, but he is also most likely considering a presidential primary run in which unions would be vital.
Disagreeing with public sector unions does not make you anti-union. It means you recognize the difference between the public and private sectors.
Private-sector unions negotiate with companies to share business profits and reduce income inequality. Public-sector unions negotiate with public officials who represent us all. Those same officials often stand for elections in which unions have outsize influence. When the unions secure undue concessions, it is the public that pays.
Democrats get this argument when it comes to police unions. They tend to overlook that it applies with equal force to the unions that represent teachers and subway conductors.
Declining blue-state populations are not only a failure of Democrats’ governance. They are also a growing problem for the party’s presidential prospects, as electoral votes shift from blue states to red and purple ones.
There are some signs Democratic leaders are toughening up. Mr. Pritzker poured cold water on on further pension sweeteners. Ms. Hochul vetoed the bill requiring two-person crews on New York subway trains. Mr. Mamdani abandoned his union-backed campaign promise to give up mayoral control of public schools.
Unions themselves may see the merit in showing greater flexibility. If Democrats can’t govern well with labor at the table, Republicans are likelier to win nationally — and destroy collective bargaining itself.
Today, public-sector unions are helping defend democracy. They will always deserve a voice. But Democratic leaders cannot wait for unions to change. They need to break more often with their friends if they want to show that government can succeed.
Nicholas Bagley is a law professor at the University of Michigan and a former chief legal counsel to Gov. Gretchen Whitmer of Michigan. Robert Gordon is a visiting fellow at the Harvard Kennedy School and a former senior official in the Biden and Obama administrations and at the New York City Department of Education.
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