Should Wisconsin Look to Private Sector?

NEW YORK (TheStreet) -- Maybe Wisconsin Gov. Scott Walker should take a lesson from the private sector, where crisis negotiations with labor unions can lead to wins for all involved.

GM (GM) just announced a $4.7 billion profit for 2010, its biggest net income since 1999. One outcome: It awarded bonuses averaging $4,300 to 45,000 hourly workers.

Gov. Scott Walker, second from left, is greeted by protesters as he arrives at the airport in Kenosha, Wis., to hold a news conference about his budget repair bill on Feb. 25.

Ford(F) reported 2010 net income of $6.6 billion, the highest in 10 years. It awarded bonuses of $5,000.

In the airline industry, US Airways (LCC) negotiated with its unions during a 2004-05 bankruptcy and just reported its second most profitable year. In 2010, it distributed $48 million in profit sharing plus operational incentives of $24 billion.

Alaska Airlines (ALK) produced a return on invested capital of 10.7% in 2010, when its shares rose 62%. Alaska's customer service is routinely rated highly by J.D. Power, and on Feb. 14 it gave out bonuses totaling $92 million, approximately a month's pay per person

And Boeing(BA) may constantly battle the International Association of Machinists, but it is also clear that the union played a role in the company's securing a $35 billion tanker contract on Thursday.

It may be obvious that someone starting a business today would seek to provide working conditions and wages and benefits that would incent workers not to unionize. But it does not necessarily follow that a good practice is to tear up an existing business in order to get rid of the unions that are already there.

Didn't Frank Lorenzo try that, sacrificing Eastern Airlines in the process? Doesn't Walker, who has already won union agreements to wage and benefit concessions, seem interested only in busting unions?

"It's pretty clear that what's going on in Wisconsin has little or nothing to do with the budget deficit," said Bill Dougan, president of the 110,000 member National Federation of Federal Employees, an IAM affiliate.

Mike Flores is president of the US Airways chapter of the Association of Flight Attendants, which is currently negotiating a new contract after making concessions during a 2004-2005 bankruptcy. Those talks have reached a particularly contentious stage.

Still, Flores said, "When we were in bankruptcy, the union got it. We realized the company was in dire straits and we did some things we didn't like but needed to do. We did that in a proper forum, face-to-face negotiations."