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New York Post

 

Bonded To Reality

April 23, 2013

By Nicole Gelinas

Bad news for city unions

Big, bad billionaire Bloomberg has been a useful foil for the city’s unions: Labor honchos insist that the mayor is out of touch for asking them to melt down a layer of their gold-plated benefits — and they point out that he’s leaving soon, anyway, so they might as well wait. But come January, union members may figure out it’s not Mayor Bloomberg’s fault, but just the fault of math.

Listen to the people who want to be the next mayor — and you’ll hear that they’re already whispering this truth.

Last week, Mike Bloomberg gave the unions an offer he could refuse. The mayor’s deputy said he’d be happy to sign new labor deals, resolving contracts that have been expired since shortly after Lehman Bros. collapsed during the financial crisis.

On two conditions, though. First, no retroactive raises — only raises for future work. Second, workers must pay something for their own health-care premiums. Right now, 95 percent of city workers don’t. The city even pays for retirees’ premiums for Medicare doctors’ visits and lab tests.

The mayor’s proposal was reasonable — timid, really.

Health insurance for workers and retirees will cost Gotham taxpayers $6.3 billion this year. Add in other "fringe benefits," like uniform allowances, and the total is $8.5 billion. That’s more than double what it was a decade ago, and more than 17 percent of city tax revenues.

These benefits alone — not including pensions — add 40 percent to the city’s $22 billion bill for wages and salaries, and they’re still rising.

With a $2.4 billion budget deficit awaiting the next mayor, there is no way the city can afford the $8 billion price-tag for retroactive raises — none. It can’t even afford what Bloomberg is offering.

But Harry Nespoli, who heads the umbrella of city unions, told New York Business Journal that paying health-care premiums is "off the table" — and added that his members have been borrowing on credit cards in the expectation that they’ll get back pay.

Someone should tell that to the mayoral candidates — and not just the Republicans.

Yesterday, Bond Buyer magazine held a mayoral debate so that the candidates could say what they think about the city’s debt and spending. Everybody vowed to control health-care spending.

Sure, you expect it from former MTA chief Joe Lhota, who said that city spending is growing, growing way out of control." It’s a "huge problem" that city workers "when they retire get free health care for the rest of their life," he said. He promised to "negotiate with unions" to reduce the city’s unfunded $80 billion health-care promise to retirees.

And people are coming to expect it from Adolfo Carrion, the former Bronx borough president who’s lately acting fiscally hawkish. He called health benefits a "weight" and a "drain" on the city fisc, noting that "when I worked for the federal government, I paid 20 to 25 percent" of his health-insurance premium (just like most private-sector workers do).

But John Liu? The union-loving comptroller pegged the city’s unpaid-for liability at $85 billion, even bigger then pension promises, and said the topic would be subject to "hard negotiations" with unions in a Liu administration.

On retroactive raises, former city Comptroller Bill Thompson castigated Bloomberg as "irresponsible" for not having put money aside. That may sound promising to city workers, but it could also be an excuse not to give workers raises next year, by saying it’s still Bloomberg’s fault.

(Neither City Council Speaker Christine Quinn nor Public Advocate Bill de Blasio deigned to show up to talk to the people who lend us money.)

That neither Liu nor Thompson, in particular, tried to score easy points in a left-leaning Democratic primary by promising to "fight for workers’ rights" is telling. They are all at least remotely aware that the numbers just don’t add up.

Plus, each potential mayor would have his own pet projects to push in office — Thompson wants to add cops; Liu wants to spend more on subways.

Spending yet more money on a benefit that nobody in the real world gets isn’t a priority for anyone.

Sure, public workers may console themselves by thinking that the candidates were telling the bondholders what they want to hear. Sure — and they’ll be doing what the bondholders want next year, which is pare back promises the city hasn’t paid for.

Next year, union leaders may find that they miss Mike Bloomberg more than they thought they would.

Original Source: http://www.nypost.com/p/news/opinion/opedcolumnists/bonded_to_reality_Jstaez7S2VFj9MLLvM2eOJ

 

 
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