Meet the CEO Behind the Attack on “Privileged” Public Employees

By Ruth Conniff, October 18, 2011

"Government workers are the new privileged class," James E. MacDougald, the founder of Free Enterprise Nation, told the Washington Post recently.

MacDougald, the Post explains, is a retired CEO who now heads Free Enterprise Nation, which the paper describes as a "research and activist group" which he founded "to call attention to the financial burden posed by government workers."

Actually, Free Enterprise Nation, headquartered in Tampa, Florida, is an "activist" group in the same sense that the Washington office of Dick Armey's FreedomWorks runs "activist" campaigns.

According to records available on Open Secrets, Free Enterprise Nation spent $30,000 so far this year and $60,000 in 2010 lobbying for changes in public employee pension rules, a ban on federal support for states and municipalities that are struggling to meet their pension obligations, and the expansion of domestic fossil fuel production and nuclear power, among other issues.

MacDougald put $1 million of his own money into the group,according to TampaBay.com.

It seems transparently ridiculous to call this a grassroots, citizens' uprising against the "privileged class."

But the anti-public-employee message Free Enterprise Nation and other rightwing groups are putting out has real traction.

Echoing through the talk-radio ditto-chamber, and recycled by Republican politicians from Scott Walker in Wisconsin to Arnold Schwarzenegger in California to Chris Christie in New Jersey, the idea that public employees are coddled and ought to give up pension and health care benefits is catching on with stressed-out private-sector workers.

For people who work in the private sector at all levels (and I have personally heard this message repeated by both well-off and underpaid acquaintances) there is real resonance to the message that public employees shouldn't have job security, a decent retirement, and high-quality health care mostly paid for by their employers while private sector workers have seen their 401Ks take a hit and are increasingly insecure.

The huge irony here is that the people pushing the message are the truly privileged (not cops-and-teachers privileged—corporate-lobbyist privileged) trying to stir up resentment among different sectors of the lower and middle class.

Governor Scott Walker does this masterfully when he talks to Wisconsinites about his caterer brother who has to pay $800 a month for benefits and would "love to have the deal" that public sector workers--whose unions the governor is aiming to smash--have.

(As Democratic state senator Jon Erpenbach of Wisconsin pointed out at a Progressive Magazine event last weekend, Walker and his Republican allies in the state legislature are still comfortable enough with state employee benefits to continue to draw them for themselves.)

In a YouTube video James MacDougald claims that public sector worker have "better pay and better benefits" than private sector workers, and argues that the nation's financial woes are caused by private sector workers making an average of $59,000 a year paying taxes to support public sector workers' lavish $119,000 a year in average pay and benefits.

Those numbers are grossly distorted, as the Economic Policy Institute has pointed out since public employees in the professions, while paid considerably more than the lowest-paid private sector workers, still earn less than their private sector counterparts with comparable degrees. If you compare workers with similar education in the same line of work, public employees earn less.

Historically, people who do public service jobs were willing to accept lower pay in exchange for job security and good benefits, while their counterparts went for the big bucks in the private sector.

That may be changing. Thanks to the union-busting efforts and coordinated PR campaigns on the right, all American workers may now be gambling on Wall Street and hoping to cash out at the right time when they retire, with little in the way of job protection and declining benefits even as health care costs increase and health care industry profits skyrocket.

It's no accident, of course, that the right is targeting public sector unions, since 36% of public employees are in unions, compared with a paltry 7% in the private sector.

And it's no accident that unions are the target of the corporate-financed message that public employees should have their pensions raided and their health care rolled back

The Post notes that "union leaders say their members are being asked to pay for the mistakes made by politicians who chose not to adequately contribute to pension plans and by Wall Street firms whose disastrous bets led to big investment losses."

But if public employees are being asked to pay--taking big benefit cuts and seeing their unions destroyed--Wall Street banks are posting profits, paying large bonuses, and hoisting their champagne glasses thanks to trillions in taxpayer bailout funds.

The real punchline: they got where they are in part by convincing American voters that teachers and firefighters are the "privileged class."