Hawai'i Strike Report: Union Imperialism

One of the oddest features of the otherwise unbalanced Tentative Agreement (TA) our union negotiated for us is something which is being called the"Most Favored Union" clause. It guarantees that our health insurance premium payments will be as low as the lowest rate paid by any other public sector employee union in Hawai'i.

In the short run, this is clearly a benefit: several other unions pay less of their health care costs than we do, so, if approved, we face an immediate cut of as much as 20-25% in our premiums. Great! So why, in my anti-TA flyer did I refer to the MFU clause as"a dangerous cop-out"?

First, the tactical problem: if the state negotiates with the other unions as aggressively as with UHPA, our rates could rise without our consent at a time when health care costs are already expected to continue rising sharply. There's some question as to whether the existing contract [PDF] and the new clause [PDF] taken together mean that our rates cannot rise above their current levels, but even so that could mean 20% fluctuations in our premiums over and above increased insurance costs (nobody's saying health insurance costs are going to go down anytime soon, are they?). If we don't have the guts to negotiate, and clearly we don't (yet: the vote is next week), then why should any other union?

Second is the easily foreseeable result of this clause: increased pressure by the state on our fellow public sector unions to lower their insurance benefits. After all, if the state can bargain down UPW, it gets a corollary savings from the reduction in our benefit. Conversely, of course, if UPW is pushing for a better benefit, the state has an added incentive to hold fast, because the cost of granting concessions has gone up. If I were a member of UPW, or HSTA or one of the other unions, I'd be more than a little peeved at UHPA right now.

The"Most Favored Nation" clause is, of course, something of a blight on history. In 19th century China and Japan and Korea and the Ottoman Empire (the cases I know about), Western powers used MFN clauses to piggyback on each others' victories and dismantle significant components of the sovereignty of the nations on the receiving end of these treaties. The system was so inherently unfair that we now just call them"unequal treaties." The MFN clause was not limited to trade, though dismantling tariffs and trade restrictions was its primary goal: Christian missionaries benefited, and once-closed societies were forced to open their ports and their countryside to people they really had no desire or need for.

Now, MFN is mostly discussed in terms of trade with China, and a few other nations, as a privilege that we grant for our own reasons and benefits: it's nice to negotiate from a position of strength. International standards like the WTO are reducing our right to decide who is and isn't a"favored nation" but so far we haven't felt the pinch of losing control over our economic policy as a few other nations have.

I'm more than a little concerned about my union's use of this device. It is unstable and destabilizing, and a terrible precedent. It puts extra pressure on other unions at a time when the state is already negotiating hard, and it doesn't guarantee us much, in the long run. And this is a long-run contract: six years.