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Posts Tagged ‘New York City’

Bloomberg’s Job Killing Budget Cuts

Thursday, December 9th, 2010

amytraub4It’s the city’s ninth round of budget cuts in three fiscal years, and the most brutal. Mayor Bloomberg calls for 6,201 layoffs of public workers in the 2011 and 2012 fiscal years. Instead of responding at our firehouses, serving our frail elderly, and helping job-seekers perfect their resumes on the library computer, former New York City employees will instead crowd the unemployment lines – where, given the fact that there is just one job opening for every five Americans looking for work, they are likely to remain for some time. But this understates the impact on New York’s economy.

When we lay off public workers, we not only lose the services they provided to New Yorkers but also their spending power as city residents. As a result, laying off 6,200 New York City workers means destroying an additional 1,860 private sector jobs. The last thing New York needs is another 8,000+ jobless.

Think about it: the administrative worker in the city finance department who used to support her family on $45,000 a year now qualifies for a maximum $405 a week in unemployment benefits. She’ll buy cheaper groceries, cancel the cable, pull the kid out of ballet lessons, and put off the next shoe purchase, for starters. Suddenly the neighborhood grocery store, shoe shop and ballet studio have lost revenue: multiply that and they’ll quickly be ready for more layoffs of their own. Small businesses already on the edge may close up shop completely. In the meantime, New York taxpayers pick up the tab for her unemployment benefits as our former city worker searches in vain for a new job. It’s a bad deal all around.

Worse still, destroying 8,000 jobs in New York City is completely unnecessary. Economists find that progressive tax increases on higher income households do far less economic harm than spending cuts and layoffs. As the Fiscal Policy Institute has pointed out, New York City could raise $1 billion by raising personal income taxes on residents making more than $250,000 a year while still reducing taxes for lower-income households. Studies at the national and state level find that wealthy taxpayers do not flee tax increases in significant numbers. Yet Mayor Bloomberg has categorically ruled out such an increase, arguing that killing jobs and decimating city services is preferable.

DC37, a public employees’ union with a big stake in avoiding city job cuts, has identified still more sources of new revenue. The city could more seriously enforce its existing tax laws on billboards and cell phone antennas, for example, and could crack down on inappropriate property tax exemptions, making certain that when non-profits sell land to for-profit companies, property taxes are once again levied on those previously exempt parcels. Yet there’s no sign that these common sense proposals are on the table either.

This article was originally posted on DMI Blog.

About the Author: Amy Traub is the Director of Research at the Drum Major Institute. A native of the Cleveland area, Amy is a Phi Beta Kappa graduate of the University of Chicago. Before coming to the Drum Major Institute, Amy headed the research department of a major New York City labor union, where her efforts contributed to the resolution of strikes and successful union organizing campaigns by hundreds of working New Yorkers.

New York's Lousy Jobs (And How We Can Make Them Better)

Friday, November 26th, 2010

amytraub4Should we tear down the city’s middle class? Or work to turn lousy jobs into good ones? That’s the policy choice facing New York’s city and state leaders. So far, their decisions aren’t encouraging: for years New York has failed to use its economic development programs to promote the creation of good, family-supporting jobs. Now it is welcoming Walmart’s industry-decimating low-wages with open arms. The state has so far failed to take a stand against $1 billion a year in wages stolen from New York’s lowest-income workers, but instead is spoiling for a fight of a very different sort: vowing to scale back the pay and retirement security of middle-class teachers, transportation workers, and other public employees.

The result? A disappearing middle class amidst the proliferation of lousy, low-wage jobs. It doesn’t have to be this way.

For the time being, New York City is getting more lousy jobs. We are gaining retail and restaurant jobs — positions that often lack benefits and fail to pay a living wage – while losing middle-class jobs in the public sector and manufacturing. To make matters worse, education and health care – among the few bright spots in New York City’s recovery over the past year (as well as the state’s job growth over the past decade) — are the very areas Governor-elect Cuomo has vowed to cut.

As a result, the disappearance of New York’s middle class is likely to accelerate. We may continue to be home to more millionaires but we’re also apt to see more people with jobs showing up at food pantries because they’re not earning enough to feed their families.

None of this is inevitable. The economic trends impacting New York today were heavily shaped by past public policy decisions at the federal, state, and local level. Meanwhile the choices made by our political leaders today could redirect (or intensify) the way the city’s economy develops. What will New York stand for?

If we’re stung by the loss of good jobs, one reaction is to turn our resentment on the folks who still have solid middle-class careers: deplore teachers who still have protection from arbitrary layoffs and insist that the biggest problem New York faces is that parks department workers still have pensions. We could assert the worker protections they enjoy are outdated, trash the compensation these public workers earn, and turn their jobs into lousy jobs too.

While we’re at it, we can welcome Walmart into the city and insist that it’s perfectly acceptable for people to go to work every day and still need food stamps to feed their children. Maybe the teachers we’re laying off can get jobs there.

Or we could try something different.

We could, for example, to look at the hundreds of millions of dollars in economic development subsidies the city spends every year and insist that these taxpayer dollars be used to promote jobs that allow working people to support their families. New York could emulate Pittsburgh’s decision to stop using subsidies to foster poverty wages. We could pass the Fair Wages for New Yorkers Act to insist that the mega-developments underwritten by our public dollars pay decent wages. These measures won’t put an immediate halt to the decline of job quality in New York, but at least they’ll put the city’s economic muscle on the side of the angels.

We could also work to ensure that the job standards we have now are enforced. New York’s minimum wage is an inadequate $7.25 an hour, yet a fifth of the city’s low-wage workforce (317,200 working people) are cheated out of even that meager pay or fall victim to other workplace violations in a typical week. The state’s Wage Theft Prevention Act, now languishing in Albany because the Assembly and Senate passed slightly different versions, would be a step towards enforcing the laws now on the books to protect New York’s lowest paid workers.

It’s not too late for New York to take a stand for good jobs, strengthening and expanding the city’s middle class rather than tearing it down. But the longer New York waits to reverse course, the more difficult it will be.

This article was originally posted on DMI Blog.

About the Author: Amy Traub is the Director of Research at the Drum Major Institute. A native of the Cleveland area, Amy is a Phi Beta Kappa graduate of the University of Chicago. Before coming to the Drum Major Institute, Amy headed the research department of a major New York City labor union, where her efforts contributed to the resolution of strikes and successful union organizing campaigns by hundreds of working New Yorkers.

Wrestling With Racial Bias, New York Firefighters Resist Reform

Friday, October 22nd, 2010

Michelle ChenNew York City’s firefighters have been embroiled in racial and ethnic politics throughout their history, and the Fire Department’s latest civil rights controversy has stoked a political standoff and a hiring freeze.

The FDNY is still reeling from a federal court ruling in August that put firefighters at odds with anti-discrimination law. The judge ruled that the Department’s recent hiring exam was systematically discriminated against Black and Latino candidates.

But to accommodate the need to hire new personnel, the court offered the city the option of initiating an interim hiring process, as long as the procedures were not discriminatory. The city has so far refused. So now, a long line of frustrated aspiring firefighters remain in limbo, denied a fair shake at obtaining a coveted spot in the ranks of New York’s Bravest.

The Center for Constitutional Rights and lawyers representing the Vulcan Society, an association of Black firefighters, accused the FDNY of obstruction:

We had searched for the least disruptive, least discriminatory, and most fair ways to hire this class. Judge Garaufis, rather than forcing any one method on the City, opted to give it the choice to select the method it preferred.  Instead, the City continues to obstruct any efforts at collective resolution and drag its feet when it comes to diversifying the firefighter workforce.

This suit is in some ways the inverse of the famous Ricci v. DeStefano case, in which a group of mostly white firefighters in New Haven sued over the city’s rejection of exam results that might have invited charges of racial discrimination. In New York City, advocates for Black firefighters charged that the city’s exam process effectively imposed racial barriers.

The controversy is especially heated not just because of firefighters’ status as urban folk heroes, but because the bias at play here isn’t blatant racism but a more subtle intransigence that’s embedded in the institution’s cultural mindset.

While the FDNY’s defenders posture themselves as victims of political correctness, the crux of Judge Garaufis’s ruling was fundamentally not about constructing a race-conscious hiring process, but rejecting tests that simply don’t do their job:

The City has not shown that the current examination identifies candidates who will be successful firefighters. Because the test questions do not measure the abilities required for the job of entry-level firefighter, the examination cannot distinguish between qualified and unqualified candidates, or even between more and less qualified candidates…. What the examination does do is screen and rank applicants in a manner that disproportionately excludes black and Hispanic applicants. As a result, hundreds of minority applicants are being denied the opportunity to serve as New York firefighters, for no legitimate or justifiable reason.

The FDNY’s problem is that it can’t really justify why its squad bears so little demographic resemblance to the city it serves. While Blacks and Latinos make up only 4 and 7 percent of the city’s firefighters respectively, the plaintiff’s lawyers point out, “More than half of Los Angeles and Philadelphia’s firefighters, and 40 percent of Boston’s are people of color.”

The only reasonable explanation appears to be a latent tolerance, if not active defense, of an entrenched white majority. Below the surface lies a complex fraternal subculture rooted in the sinewy traditions of Old New York, when fire companies operated more like ethnic gangs than a government agency.

Today, the FDNY may function more or less as part of the city’s vast bureaucracy, but its resistance to court-ordered reform betrays an arrogance grandfathered from an earlier time.  With their refusal to institute an interim hiring process, they’ve apparently decided that for now, they’d rather put up a good fight, than work with the community to figure out a way to sustain its ranks without violating civil rights. Old habits are hard to extinguish.

This article was originally posted on Working In These Times.

About the Author: Michelle Chen’s work has appeared in AirAmerica, Extra!, Colorlines and Alternet, along with her self-published zine, cain. She is a regular contributor to In These Times’ workers’ rights blog, Working In These Times, and is a member of the In These Times Board of Editors. She also blogs at Racewire.org. She can be reached at michellechen@inthesetimes.com

Living Wage Law Would Create Benefits for Business, City's Economy

Wednesday, July 7th, 2010

John PetroIn response to the hottest legislative issue in City Hall right now, the Daily News ran two opinion pieces on a bill that would guarantee living wages to all workers at city-subsidized development projects. This would mean that if a developer receives city tax breaks or other assistance to build a mall, for example, the retail workers, janitors, parking attendants, and any other employee at that mall would be paid at least $10 an hour with health benefits, or $11.50 an hour without benefits.

The principle behind the bill is simple: the city should only use taxpayer dollars to create high-quality jobs. Subsidizing the creation of poverty-level jobs makes little economic or fiscal sense. After all, it already costs the state at least $5.2 billion to provide services and assistance to the working poor. Why should we use scarce tax dollars to subsidize development that will only add to these public costs?

In a piece filled with false assumptions and unsupported claims, Diana Furchtgott-Roth argues that guaranteeing the creation of good jobs will actually hurt the city’s economy and its taxpayers. Not only is the living wage in Furchtgott-Roth’s crosshairs, but also the prevailing wage and even the minimum wage. In other words, Furchtgott-Roth rejects the idea that government should regulate the labor market.

Clearly there are good reasons for government to do exactly that, not just in the name of altruism but for the sake of the taxpayer, the business climate, and the city’s overall economy. In 1960, speaking to members of Congress, President John F. Kennedy noted that, “The increases in purchasing power resulting from a higher minimum wage will help to restore consumer demand required to put our idle industrial capacity back to work.”

Even in China, which built its economy on low-cost labor, cities are passing new laws that boost worker wages in order to increase the purchasing power of Chinese households and to create domestic demand for Chinese goods and services.

But the discussion about wages and business in New York City has become so backward that the real and demonstrable benefits of boosting wages for the city’s economy has become lost in a sea of misinformation.

Take Furchtgott-Roth’s piece. The living wage bill will, according to the author: stall development, cause businesses to flee the city, waste taxpayer money, and increase unemployment. Notably absent was any evidence to support these claims.

In reality, living wage laws have not had any significant negative impact on businesses in the over 120 cities that have passed these laws. In Santa Fe, New Mexico every single worker within city borders is guaranteed by city law to be paid a living wage. This is, by far, a much more ambitious bill than what is currently under consideration in New York City, where only workers at subsidized buildings will be covered. And yet, a study by the University of New Mexico Bureau of Business and Economic Research has shown that since Santa Fe passed its living wage law there has been no demonstrable negative effects on employment or firm growth. Studies of other cities with living wage laws have demonstrated similar results.

Despite the evidence the living wage bill in New York City is strongly opposed by Mayor Bloomberg and real estate interests. This is because the bill challenges the current economic development status quo. Instead of promoting the types of projects that create the most wealth for a select group of developers, the bill would ensure that working New Yorkers benefit directly from the city’s economic development efforts

About The Author: John Petro is an urban policy analyst at the Drum Major Institute for Public Policy. He runs the Progressive Urban Model Policies (PUMP) Project, a first-of-its-kind initiative to organize and share best practices in policy design and implementation. His writing on urban issues has appeared in the San Francisco Chronicle and his recent research has been covered in Politico, The New York Times, Reuters, and other media outlets.

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