The Trajtenberg Report’s gaping lacuna: public-sector union

By
October 5, 2011 13:02

These unions exploit their control over vital industries to extort outrageous benefits while offering lousy service. Unless their power is curbed, any reform will at best be only partially effective.




PM Netanyahu with Prof. Trajtenberg at cabinet

PM Netanyahu with Prof. Manuel Trajtenberg 311 (R). (photo credit: Marc Israel Sellem)

The Trajtenberg Committee’s report, which was submitted to the government last week, offered some valuable ideas for lowering prices and improving service. These include several proposals to increase competition, from eliminating protective tariffs to allowing private terminals to operate at the ports, plus sensible suggestions like having the government release more land for residential construction, expanding a program to let grade-school students borrow textbooks rather than buy them, and raising taxes on vacant apartments to encourage owners to sell or rent them.

Nevertheless, the report has one gaping lacuna: It ignores the powerful public-sector unions. Currently, these unions control many of the economy’s most vital products and services, including banks, ports, airports, railroads, electricity and water. And they exploit this control to extort outrageous salaries and benefits, which the public must finance through higher tariffs and fees, while also providing service that is poor at best and downright abusive at worst.

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