Are public workers and private workers really very different?

One place where you can see that managers in the public sector and managers in the private sector are more similar than different is that unions in the public sector and unions in the private sector tend to negotiate contracts that are more similar than different. If public-sector unionism really meant "that representatives of the union will often be on both sides of the collective bargaining table," you'd likely see large and continuous wage increases. The unions would go to themselves, or their friends, and say they want fatter paychecks, and fatter paychecks would appear. But that's not how it works.

Rather, we tend to see a lot of deferred compensation: Salaries don't go up by much now, but pensions go up by more later. And we see it in the contracts negotiated by both public- and private-sector unions. That suggests that managers in the public sector are resistant to increasing their costs, just as they are in the private sector. Faced with union demands that will lead to higher costs, they often shunt them into the future. And it's not hard to see why: Politicians don't like raising taxes and cutting services any more than CEOs like raising prices or reducing dividends.

For the record, I don't like deferred compensation for exactly the reason we're seeing now: Workers think their pension is a fact when it's really just a promise -- and promises can be broken. But I also don't like watching CEOs think in terms of quarterly earnings rather than long-term performance. Myopia is a problem that unites all sorts of institutions. Just like the tensions between workers and managers.