Doomsday for Real
April 16, 2003
By E.J. McMahon
MAYOR Bloomberg's $1 billion "doomsday" budget- cutting plan is widely perceived as a scare tactic designed to force concessions out of Gov. Pataki and the Legislature: Once Bloomberg gets what he needs out of Albany, the contingency plan goes back into a locked drawer in the basement of City Hall.
Not so fast: Even if the state coughs up $1 billion or so in new cash or aid restorations, there will still another crucial shoe to drop - $600 million in contractual concessions from the city's labor unions, which Bloomberg is counting on every bit as much as increased state aid.
If he doesn't get it, the "contingency" could quickly need to become a reality. And the unions are not in a giving mood.
This was entirely predictable, given their history, but it seems to have only gradually dawned on Bloomberg.
Fortunately, there are signs that the mayor is starting to run out of patience. Indeed, the high point of Bloomberg's Powerpoint slide show yesterday was a moment of silence during which he invited reporters to scrutinize three quotations from union officials hostile to contract givebacks - grouped under the sarcastic headline "Expressions of Support for $600 Million in Savings by Leading Labor Leaders." No further comment was necessary.
To date, the unions' response to Bloomberg's request for savings ideas has been a familiar series of illusory givebacks, including a pension-fund "loan" repayable at a near-usurious 8 percent. To his credit, Bloomberg has flatly rejected such proposals, making it clear he is seeking "labor productivity actions, not cost deferrals."
If anything, the $600 million understates the potential savings to be realized by exploiting productivity options. For example:
* Requiring civilian workers to put in a 40-hour week would save about $500 million, estimates the Citizens Budget Commission (CBC).
* Requiring city workers to contribute the same share of health-insurance premiums as state workers would save more than $230 million, reports the Independent Budget Office.
* Requiring teachers to work one additional class period per day - and paying them extra as part of the bargain - would save a net $535 million.
And there are plenty more ideas where those came from. More sensible scheduling of police - including a shorter work day - could save $250 million, according to the CBC. Eliminating paid sabbaticals for teachers could save $88 million. And the IBO estimates that contracting out sanitation routes on a managed-competition basis could ultimately save $71 million a year.
The only money-saving alternative to real productivity enhancements - which would allow the city to provide the same level of services with thousands fewer workers - would be the crude meat-axe approach of Bloomberg's contingency plan, complete with layoffs of thousands of police officers, reduction of garbage pickups and other service cuts.
The prospect of such cuts will no doubt be enough to intimidate Albany politicians into making concessions. But will they work on union leaders who are answerable only to their own memberships?
That question will be answered within the next few months, because Bloomberg can't afford to wait much longer.
The state budget should be wrapped up soon, if only because Albany is running out of cash without one. In all likelihood, Bloomberg will get close to what he needs from the Legislature, over Pataki's veto if necessary.
At that point, the mayor will be free to turn his focus entirely to the real source of his problem - Randi Weingarten of the United Federation of Teachers, Lillian Roberts of District Council 37, Patrick Lynch of the Patrolmen's Benevolent Association and their counterparts in the municipal labor coalition.
When Bloomberg sits down with the unions, there are two important figures he needs to present: Since 2001, the city has imposed $2.5 billion in new taxes and fees on its still-shrinking economy. Union givebacks during the same period have totaled precisely zero.
Memo to Ms. Weingarten, Ms. Roberts, Mr. Lynch, et. al.: It's time to step up with some of that "shared sacrifice" you're always talking about.
E.J. McMahon is a Manhattan Institute senior fellow. His work also appears at www.nyfiscalwatch.com.
©2003 New York Post
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