Obama puts the freeze on workers
Lee Sustar argues that Barack Obama's federal pay freeze
is only the latest example of the Democratic Party's
embracing of austerity at labor's expense.
December 3, 2010
http://socialistworker.org/2010/12/03/obama-puts-freeze-on-workers

PRESIDENT BARACK Obama has just painted a target on the
back of every public-sector worker in the U.S. with his
November 30 order of a two-year pay freeze for all
nonmilitary personnel. That action by a supposedly
pro-union president gives political cover for every
governor, mayor, city council and county board to carry
out similar measures--or worse--in the name of "fiscal
responsibility."

"Is this Obama's PATCO?" asked Robert Borosage,
co-director of the Campaign for America's Future,
referring to President Ronald Reagan's firing of some
11,000 striking Professional Air Traffic Controllers
Organization members in 1981. "Will employers across the
country use his language and his message to inflict
another round of pay cuts?"

In the public sector, of course, such cutbacks have been
going on for several years, with layoffs, unpaid
furlough days and the privatization or elimination of
government services. According to the Center on Budget
and Policy Priorities, state and local governments have
wiped out 407,000 jobs since August 2008.

Those losses would have been even worse without the $787
billion stimulus spending of early 2009, which included
some aid to the states to help them cover budget
shortfalls. Now the stimulus effect has subsided, and
state governments are still swimming in red ink--even
after closing budget gaps of $425 billion since 2008.
Unlike the federal government, most states are barred by
law from running deficits--so in statehouses across the
U.S., it's cut, cut, cut.

Now, with the Republican takeover of the U.S. House of
Representatives, it's even more certain that austerity
will become the policy of the day in Washington.

Obama justified the pay freeze as a measure to reduce
the federal government's budget deficit. "The hard truth
is that getting this deficit under control is going to
require some broad sacrifice, and that sacrifice must be
shared by employees of the federal government," the
president said at a news conference.

But the freeze will save only $2 billion by the end of
the fiscal year in 2011 and $5 billion over two years,
according to the Office of Management and Budget. That's
peanuts compared to what the federal government wastes
every year on the biggest source of the federal deficit:
the Defense Department, whose budget is $685.1 billion
for 2010. The Pentagon spends almost as much to buy a
single Virginia-class attack submarine as Obama will
save in the first year of his pay freeze.

As Obama made his pay freeze announcement, Democrats and
Republicans were still bickering over legislation to
extend the Bush-era tax cuts--but the final legislation
will almost certainly continue the tax breaks for all
Americans, including the very richest, at least
temporarily.

According to the Joint Committee on Taxation (JCT), it
will cost $38.8 billion to extend the tax cuts for the
top income brackets through 2011. That's nearly 20 times
more than Obama plans to save with his pay freeze that
year--all to ensure that millionaires get an average tax
cut of 103,384 each, according to the JCT.

- - - - - - - - - - - - - - - -

THE THREAT of an anti-labor agenda of slashing
public-sector wages, benefits and jobs was a large part
of the motivation for the unions to pour an estimated
$100 million into Democratic campaigns in the 2010
elections.

According to the Center for Responsive Politics, the
main public sector union, the American Federation of
State, County and Municipal Employees (AFSCME), spent a
record $12.4 million on Democratic races, while the
Service Employees International Union (SEIU), which also
has a large presence in the public sector, spent $15.8
million. The National Education Association, the 3
million-member teachers' union, spent $7.5 million.
Chris Townsend, the Washington representative of the
United Electrical workers union, estimates labor's
combined spending on the 2010 elections to be between
$800 million and $1 billion.

And yet even supposedly pro-labor Democratic candidates
were blunt about the fact that they, too, would take aim
at the unions. In New York, Gov.-elect Andrew Cuomo
explicitly stated that his model was the so-called
"social contract" of the mid-1970s in which
public-sector unions took huge concessions to bail out a
bankrupt New York City. His campaign message for the
unions was so harsh that a New York Times headline
described his program as an "offensive" against
organized labor.

And that's at least one campaign promise that Cuomo is
going to try to keep. According to the Wall Street
Journal, Cuomo is assembling a team of business lobbying
groups to wage a $10 million, anti-union campaign.

A similar scene is playing out across the country in
California. Jerry Brown, while campaigning to return to
his old job as governor earlier this year, declared that
he would have to "do things that labor doesn't
like"--including reducing public employee pensions.

But that didn't stop the state's biggest public-sector
union, Service Employees International Union (SEIU)
California, from pumping $11.2 million into Brown's
campaign, plus 90,000 hours of phone-banking and
canvassing.

Members were initially told by SEIU officials that Brown
had to be elected so that the union could avoid making
concessions to outgoing Republican Gov. Arnold
Schwarzenegger, who sought to help balance the state's
$19 billion budget deficit with unpaid furlough days
that amounted to a 15 percent pay cut.

Yet SEIU Local 1000--California's biggest public-sector
union, representing 90,000 workers--went ahead and made
a deal with Schwarzenegger three weeks before the
election anyway.

Under the agreement, which was ratified after the
elections, Local 1000 members will take a 12-month, 4.62
percent pay cut through 12 unpaid personal days.
Employee pension contributions will also rise by 3
percent, put the total cost of concessions at around 8
or 9 percent. Plus, new hires will get smaller pensions
under the deal.

SEIU Local 1000's givebacks are predicted to save the
state $383 million--a big chunk of the $900 million that
California Democrats want to squeeze out of
public-sector workers.

As Sacramento Bee columnist John Ortiz pointed out, "For
starters, the agreement means Gov.-elect Jerry Brown
won't have to say "no" to a huge contributor to his run
for governor," since SEIU California has already
swallowed concessions. The deal is likely to set the
pattern for other California public-sector unions'
negotiations with Brown, Ortiz wrote, and "the unions
expect Brown will dial down the rhetoric. But better
contracts than what Schwarzenegger has inked? Not
likely. Maybe even a little worse."

Other Democratic governors are also poised to demand
concessions from unions. In early 2010, Illinois Gov.
Pat Quinn proposed what would have been the largest
budget cuts to education in state history, until the
state legislature dialed them back. Even so, both the
Illinois Federation of Teachers, Illinois Education
Association and Chicago Teachers Union endorsed the
governor on the grounds that his Republican rival would
have been worse. But with Illinois staring at a
California-style budget cut, Quinn is certain to come
looking for more concessions from unions.

In Oregon, both the Oregon Education Association and the
state's American Federation of Teachers affiliates
poured money and resources into the successful effort to
return John Kitzhaber to his old job as governor. But
Kitzhaber went out of his way to say that he would hold
down projected pay increases for teachers and other
public sector workers.

- - - - - - - - - - - - - - - -

NOW COMES Obama's pay freeze for federal workers to
legitimize all these policies--and pave the way for
still deeper cuts. Obama and the Democrats--who were
elected in 2008 as workers sought relief from the
economic meltdown and George W. Bush's policies--are now
competing with the Republicans to come up with the most
"fiscally responsible" approach to deficits.

And the unions, which looked to Obama to make it easier
to organize unions through the proposed Employee Free
Choice Act, now finds themselves the targets of
Democrats and Republicans alike. Less than two months
after the unions mobilized tens of thousands of people
to Washington for the One Nation jobs march that was, in
effect, a Democratic Party election rally, Obama himself
is giving the green light for more attacks.

AFL-CIO President Richard Trumka did criticize the pay
freeze, stating that:

No one is served by our government participating in a
"race to the bottom" in wages. We need to invest in
creating jobs, not undermining the ones we have. The
president talked about the need for shared sacrifice,
but there's nothing shared about Wall Street and CEOs
making record profits and bonuses while working people
bear the brunt. It is time to get our nation back on
track, but we should not do so by placing an even
greater burden on the middle class.

That's the right sentiment. But the obvious question is
whether and when organized labor will face the reality
that there's a bipartisan drive towards austerity--and
organize to resist it, following the example of workers
in Greece, France and Portugal.

Because it's clear that unless working people draw a
line, the attacks will continue--and they'll be carried
out by Republicans and Democrats alike.

____________________________________________

PortsideLabor aims to provide material of interest to
people on the left that will help them to interpret the
world and to change it.

Submit via email: [log in to unmask]

Submit via the Web: http://portside.org/submittous3

Frequently asked questions: http://portside.org/faq

Sub/Unsub: http://portside.org/subscribe-and-unsubscribe

PS Labor Archives: http://portside.org/archive

Contribute to Portside: https://portside.org/donate