Those Who Face Reality, Those Who Do Not
AR commenters and contributors have observed for some time that the source of the budget problem now facing the state and locals is not a lack, demonstrated by our high property and other taxes, of revenue but rather, many years of imprudent spending.
In Providence, Local 1033 of the Laborers’ International Union of North America representing 1,900 city workers has offered concessions, including an 18 month pay freeze.
In Cranston, Local 153 of the National Association of Government Employees representing one hundred school custodians and maintenance workers have agreed to forego raises for two years and to contribute more towards health coverage.
Both sides called the contract a compromise, one that saves money and puts people back to work.
“A job is a job,” said John F. Carbone, president of Local 153 of the National Association of Government Employees. “In layman’s terms, we were able to save five jobs.”
Tuesday night, East Providence City Councilors instructed legal counsel to research and report back on the option of municipal bankruptcy. By making such a request, it is clear that they are serious about their promise not to try to stick their taxpayers with a substantial budget shortfall. Quite simply, there is no more revenue to be had. Local 1033, Local 153 and the City of East Providence appear to be coming to grips with that fact.
As for “Those Who Do Not”:
For Immediate Release
January 22, 2009
Statement from National Education Association Rhode Island (NEARI) President Larry Purtill in response to Judge Pfeiffer’s decision regarding East Providence:
We are disappointed in Judge Pfeiffer’s decision to deny the restraining order that would have stopped the East Providence School Committee from unilaterally rolling back teacher salaries and implementing a 20% co-share for health care. Teachers are being harmed by the loss of pay but we have confidence that the union has a good argument before the Rhode Island State Labor Board, who has initial jurisdiction in the case. At the moment, NEARI and East Providence teachers are considering all their options, based on the judge’s decision, including an appeal to the Rhode Island Supreme Court.
East Providence teachers, despite doing their job each day in teaching the students in their classrooms, are losing money and that will continue until we reach a resolution. With the anticipated increased revenue for education from President Obama’s Economic Recovery Package, the School Committee could put an end to this contract dispute by accepting the arbitrator’s award and or sitting down with the teachers in serious negotiations.
“teaching the students in their classrooms, are losing money”
No, they’re just not getting as much. Losing money is when you go in the negative. Kinda like if the city of East Providence gave in to the union’s demands. Then the city would be “losing money”.
That’s similar to the line of argument they use when they’re in line for a 10% raise and they end up only getting 5% and then say their salaries were “cut”. Despite still getting a 5% raise.
Gotta love semantics.
Obama was promising more money to teachers who excell in the classroom. He also wanted to get rid of substandard teachers. He wants merit pay for teachers. He also wants charter schools. I never heard him promise more money to the same old worn out public education system like the one East Providence is offering up. I doubt ol’ Larry could live with the conditions that Obama would place on that extra money to education.
And Larry is insinuating that public negotiations, like the ones the EP school committee wanted, aren’t serious! I think he and his minions ought to give public negotiation a try before concluding it is not serious. I think he would find they are quite serious indeed – and quite an eye opener for all the taxpayers.
This stopped being about the teachers a long time ago; it’s about saving our city. The sooner the teacher’s convince their union to realize and accept that, the better for them. In this economy, I’d prefer them not be made jobless. “With the anticipated increased revenue for education from President Obama’s Economic Recovery Package, the School Committee could put an end to this contract dispute by accepting the arbitrator’s award and or sitting down with the teachers in serious negotiations.” This is just bizarre. I can’t even argue this type of c**p on its merits, because it is completely at odds with reality. It’s like arguing about the circumference of the Earth with someone who’s still convinced the Earth is flat. Here’s the translation of what he said: Ignore economic reality and ratify a contract you absolutely know to a metaphysical certitude that the city cannot afford, based on the slight “hope” that a one-time infusion magic money from The Obamessiah will find it’s way to East Providence, to plug up what is a structural, on-going problem that is literally getting worse every day. Remember: “Accepting the arbitrator’s award” = 20% property tax increase. If nothing changes, the city will be at least $10.2 million in debt by the end of the fiscal year — and from what I’ve heard, that’s probably a low figure. I can tell you that payroll is going to be affected well before we even get there. Each 1% increase in the property tax rate generates about $500,000 to $600,000 in revenue. $500,000 goes into $10 million 20 times. You would need two back to back 10% increases to cover that. There isn’t enough spending elsewhere in the budget to cut. Over 50% of the city’s expenditures are school department payroll and benefits, making up… Read more »
Monique
The two unions you mentioned agreed to concessions. The East Providence teachers have had money taken from them without having agreed to the co share cost of healthcare or the reduction in pay as part of negotiations.
Phil,
Every year the taxpayers have money taken from them without agreeing to it.
When the EP appropriately wanted to negotiate in open session, so that the Taxpayers footing the bill would be informed, and therefore be able to opine on, what was being offered, the Union balked. Hmmm …do they have something to hide?
You gotta love Larry Purtil calling Tax receipts “Revenue”, like it was earned.
“teachers have had money taken from them without having agreed”
Phil, the vast majority of us working in the dreaded private sector face that situation every day that we walk into work. If it happens, we have to make the determination whether to accept the reduction in pay or give notice and look for a job elsewhere.
Are you saying that there is a special class of workers who should be shielded from such realities? If you are, do you really think such an arrangement would be fair and equitable?
By the way, because there is a risk that the employee may not accept the pay cut, most employers do not take such a step lightly or just to pick on someone. If the employee does walk out, it’s time consuming and costly to some degree to solicit a replacement, screen applicants, train them, etc. There are usually sound fiscal realities behind such an unpleasant decision by an employer. (Possibly this is so in the case of East Providence …)
I, too, work in the dreaded private sector (sorry, ducky!) I work in the financial district in Boston. No, I don’t have a six-figure salary (Wonder what Pat Crowley gets from NEA? Oops, guess, that’s none of our business!!!). I earn about what a teacha gets at the top step. Well, maybe a little bit less! Small company, profitable, but we will take a
big hit in 2009 with this financial meltdown. Our CEO told us that he doesn’t want to lay anyone off, but: No cost-of-living raises this month for the coming year and no bonuses for 2009. No, not piggy Wall Street bonuses, just 7-8% of our salaries; I, and my fellow workers, consider ourselves fortunate to have jobs in these bad economic times! Bottom line? A pay decrease of approximately 10%. What are Crowley and the EP Teachas whining about?
George E Not true. Taxpayers if they are residents have an opportunity to vote for the people who negotiate contracts with the workers. If they have not held their agents feet to the fire then they are responsible for the position they find themselves. This is from a non resident taxpayer. Bam Did you have a contract that your CEO let expire? You and your fellow workers feel fortunate just to have a job. Does that statement imply that there is agreement with the CEO about your current compensation ? Is it fair for you to speak for others? Monique you are mixing apples with oranges again. Your post suggested that the two unions that were involved with negotiating concessions were the same as the one which had tried to negotiate and had accepted arbitration only to have the school committee impose its terms with no agreement. And don’t give me the private secter crap. You don’t think I understand. There’s no money coming in for me if I don’t get in my boat on these cold mornings and break ice to get to the fishing grounds. That’s my choice. It’s as though you have not seen hard times before with your whining and complaining. Take responsibility for your choices. The last I looked the East Providence teachers are at the job and allowing their representatives to seek legal relief. How the hell is that different from your precious private realities. Maybe the only difference is that they have a union to represent them and they’re not willing to just roll over. On another topic I was delighted to hear your voice on WPRO recently. I think it represented a breakthrough of sorts. I like to think that I was in some small way responsible for that. Keep up the… Read more »
Phil,
I’m hoping to get into more detail on the importance of this subject at the beginning of next week, but George E is 100% right. Changes in revenue collection have to be deliberated (ideally in public) and agreed upon by the appropriate taxing authority, and there is no higher power than can compel that authority to raise taxes if they don’t decide to.
Put another way, a contract negotiated by a city council or school committee that is unaffordable under existing revenue streams never means that tax increases become automatic.
Phil said:
“The last I looked the East Providence teachers are at the job and allowing their representatives to seek legal relief. How the hell is that different from your precious private realities. Maybe the only difference is that they have a union to represent them and they’re not willing to just roll over.”
You must be joking Phil – how are they different? A better question would be how are they the same?
First of all there is no legal relief in the private sector when a contract expires. Furthermore does anyone you know (or their representatives) get to shout down management during a board meeting when they don’t get the pay and benefits they had hoped to get? Do they get to ridicule management and intimidate management in hopes that this strategy will somehow sway the decision making process, all the while ignoring the economic realities that have forced management into this position in the first place? In the private sector they would be fired on the spot, the whole bunch of them, instead of having management led out of the room with a police escort for safety reasons.
>>Not true. Taxpayers if they are residents have an opportunity to vote for the people who negotiate contracts with the workers. If they have not held their agents feet to the fire then they are responsible for the position they find themselves. This is from a non resident taxpayer.
True more in theory than in practice.
First of all, step increases AND tenure AND pensions are imposed by state law, i.e., the unions “negotiated” these provisions in the back rooms of the General Assembly.
So too is the requirement that there be no layoff notices after the preceding March.
So too the Caruolo Act.
Frank
I’m not joking. The teachers who have had their pay cut are on the job. How is that different than the fictional private sector worker still working at the same job but earning less. Personally I’ve never had my pay cut and continued at the same position. Never. I’ve been fired and laid off and retained as many others were laid off. Increased work load with no increase in pay was the reality in that instance. But no cut in pay. I don’t think that I could handle that. I’m self employed now and have to deal with the vagaries of the market and do end up working for less one day than the day before but that is my choice. There does exist though a price for my product at which I will not work and leave the boat tied up.
Andrew
In the words or your hapless ex-president …”bring it on”. Seriously I look forward to your thinking on the subject of honoring contracts.
Phil,
In your warped way of thinking, if someone signs a 3 year contract, they have effectively signed a LIFETIME contract if at the end to the 3rd year they refuse all new offers.
Quite frankly, Cities & Towns should not be providing Guaranteed contracts to anyone.
We should be a Right-to-work State and our public employees should be employees at will.
If they don’t like what we can afford to pay them, no problem …they can leave and we will find someone that will be happy to take their place.
Phil,
No one can contract to trade away what they don’t have. Government has no more right to automatically take from others what it needs to fulfill unrealistic obligations then I have to make a down payment on a car I can’t afford, then demand that someone else give me the money to make the rest of the payments.
George E
I glad that my thinking seems warped to you. If we were in agreement I would start to worry. I may even take my next 5 bucks and have my head examined. There are teachers in East Providence that have been there for more than 30 years. In that span of time there have been many contracts of 3 years. Seeing the situation only in the here and now is convenient for those who wish to exploit the current financial problems to advance an agenda similar to the one you laid out. Any sense of continuity in education and in that particular community demands a longer view.
Andrew
What don’t they have? There is real property in East Providence that can be the source of additional revenue. It exists. Also real negotiations could yield savings.
Are you in the market for an affordable car?
I believe you have it backwards Phil, it’s the EP school committee that is looking forward into the future and responding to the long term and it’s the teacher union that is only looking at the here and now. These town level financial problems have been caused by past committees, councils, and mayors who did not consider the future financial implications of these contracts, but should have. EP’s current officials ARE looking forward and they are responding accordingly. Didn’t the EP teacher union just try to define one single pay period, this weeks diminished paycheck, as “irreparable harm”? It’s pretty obvious that it’s the teacher union that is exploiting the here and now, not the SC. Otherwise I agree about the longer view having more wieght than the (very) short term.
>>There is real property in East Providence that can be the source of additional revenue.
I’m assuming that you’re alluding to selling town assets to raise revenue.
If so, that’s merely a short term avoidance of a long term overspending problem.
Just like the rocket scientists in the General Assembly selling the tobacco money at a discount in order to raise some short term cash.
They never addressed their spending issues, and the tobacco money (which would now be providing revenue had they not sold the rights to the income stream) is now “bye bye.”
Yeah, that worked out well.
Phil,
The Teacher’s 3 year contract ended. Sorry, but they don’t have LIFETIME contracts.
By the way, guys like you and I have gotten through life without ever having a contract.
Perhaps that ought to tell you something the next time some Public Employee (e.g. Providence FFs) whine about “being without a contract”.
The party is over Phil. We can no longer afford to roll-over (and bend over) in the face of nut-bag, financially unsustainable Union demands.
And the answer is not to say “it’s your fault for not chosing to be a Public Employee Union leech”.
Frank
You make good points about the legal language used. The crux of this situation is whether the effort by the parties to reach an agreement that takes into account the financial situation of the city and provide fair compensation to the education professionals has been genuine. I have the feeling that the newly elected school committee has not wanted to reach an agreement. Remember that the teachers have accepted the arbitration judgement which includes teacher health insurance payments. So I would say that they have tried. Now how much of the attention that the current situation in East Providence has attracted has not been created by those who want to use this as a trial case. Their real reason for their actions is not to serve the educational community in East Providence. The various groups that have been letter writing and attending school committee meetings certainly see the actions of not negotiating and allowing contracts to expire and spending tax dollars in the courts as something they wish to export to other cities and towns. They have no long term interest in the education of the children of East Providence.
Frank .. I won’t lump you in with the RI coalition of millionaires or operation clean government(R) or some of the contributers and commenters at Anchors Ahoy or others who advocate the destruction of organizations who represent the interests of workers unless you wish to associate yourself with them.
Phil,
To amplify the point that Tom W is indirectly making, you’re not saying that you believe that the government of East Providence owns everything in the town and can take what it wants at will to give to someone else, are you? That’s not how government works here in a democracy, for multiple different and important reasons.
All that government has to legitimately trade away is what it acquires through the appropriations and revenue process. Any promise exceeding what’s taken in during the budget cycle is not the government’s to give.
If you don’t like that car analogy, how about this one: just because you contract to sell me 1,000 pounds of oysters doesn’t mean that the ocean owes you anything.
>>You make good points about the legal language used. The crux of this situation is whether the effort by the parties to reach an agreement that takes into account the financial situation of the city and provide fair compensation to the education professionals has been genuine. I have the feeling that the newly elected school committee has not wanted to reach an agreement. The history of the teachers unions in Rhode Island and nationally demonstrates that providing “fair compensation” is nothing but a soundbite; the only thing the unions understand is “more” notwithstanding the financial situation of the municipality or its taxpayers. If “fair compensation” where the frame of reference for those so-called “education professionals” then we would be looking at substantial cuts to the existing compensation package of pay, perks and pensions for their part-time jobs – particularly given the poor performance of the public school teaching body in Rhode Island. >>Remember that the teachers have accepted the arbitration judgement which includes teacher health insurance payments. Newsflash: arbitration almost invariably works in favor of the unions because the arbitrators know that if they don’t give them something they won’t be selected again. >>So I would say that they have tried. Now how much of the attention that the current situation in East Providence has attracted has not been created by those who want to use this as a trial case. Their real reason for their actions is not to serve the educational community in East Providence. The various groups that have been letter writing and attending school committee meetings certainly see the actions of not negotiating and allowing contracts to expire and spending tax dollars in the courts as something they wish to export to other cities and towns. And exactly how would that be different from NEARI using… Read more »
I’m a conservative Phil, so lump away, I’d be honored!
The best thing RI could do to improve education, help get the monkey off the taxpayers back, and make this a more attractive and competitive state is to repeal the Michaelson Act … the sooner the better.
Phil,
You wrote: “The crux of this situation is whether the effort by the parties to reach an agreement that takes into account the financial situation of the city and provide fair compensation to the education professionals has been genuine.”
Say what?
Define “fair”. Let me help you …”fair” is what ever the SC choses to offer. If someone doesn’t like the offer, they are free to walk out the door to go find another job, as opposed to blocking the door.
We’ve got 56,000+ people out of work in RI that will happily take the “fair” offer being made.
Let me ask you this (stealing a bit of Andrew’s approach): If you offer to sell someone a bushel of oysters for $x and they decline your offer, should you have the right to force them to buy your oysters at the price you demand by going to a judge or an arbitrator?
If the Union does not like what is being offered, they are free to take their “talents” elsewhere. I am sure there is a long line of employers that would love to pay them what they are demanding ….NOT!
It is time for the Union to get used to and embrace the Free Market.
And remember, the Taxpayers footing the bill did NOT elect an arbitrator or a Judge to determine teacher pay. Rather they elected the current School Committee. You yourself acknowledge this in your earlier post.
Andrew
No the ocean does not owe me anything. The customers who consume the oysters pays the resturant or fish store. The resturant and the fish store pays the dealer and the dealer pays me. In the same way the tax paying public pays for the educational services provided by the East Providence teachers.
TomW
Wow. Bennet Cerf is getting restless?