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Vol. 75/No. 2      January 17, 2011

Public workers target
of U.S. austerity drive
N.Y. governor vows pay freeze, deep cuts
(lead article)
Democratic and Republican politicians across the United States are implementing steep attacks on the wages, benefits, and pensions of government workers and more cuts in social programs. A broad campaign is under way to scapegoat unionized workers for growing budget deficits in the midst of the capitalist economic crisis.

Andrew Cuomo, the newly elected Democratic governor in New York, has been blunt about his intentions. “There are no more baby steps, my friends,” he said in his inaugural address, vowing to drastically slash government spending.

Cuomo says he will make big cuts in New York’s Medicaid program and freeze wages of state workers. Some 900 state workers were laid off on New Year’s Eve.

According to the New York Times, Cuomo “has kept a substantial campaign war chest on reserve” to buy advertising to counter unions if they resist his plan. He also initiated a “Committee to Save New York,” made up of real-estate moguls and businessmen to push for further layoffs and fight any proposals to increase property taxes.

The governor kept the inaugural ceremony low key, and announced he was taking a personal 5 percent pay cut in his $179,000 yearly salary to send the message that rich and poor will share the sacrifice and belt-tightening to reduce the state’s $9 billion deficit.

Union contracts for most of the state’s 190,000 employees expire March 31. But union officials so far have held few protests or strongly criticized the moves. Instead some say they are asking to be included in negotiating the exact terms. “It sounds like he’s [Cuomo] trying to set a tone that we need to all do our part,” Stephen Madarasz, a spokesperson for the Civil Service Employees Association, told the press. “We don’t have any problem with doing our part.”

Cuomo is not the only governor pushing the cost of the economic crisis onto the backs of working people under the banner of deficit reduction. The newly elected Michigan governor, Republican Richard Snyder, claims wages for government workers are “out of line” and that state workers will need to make a “larger sacrifice.”

California governor Edmund Gerald Brown, a Democrat, promised that his new budget for the state, already buffeted by layoffs and cuts in social services and education, “will be painful.”

Municipal and state governments across the United States cut 212,000 jobs last year. At the same time, many states have skipped or cut payments to pension funds. New Jersey governor Christopher Christie recently withheld $3.1 billion owed to the state’s pension fund, bringing the total owed to $53.9 billion. What this widespread practice can mean for working people was shown in Prichard, Alabama. Last year the government there stopped paying pension checks to retired city workers, saying it had run out of funds altogether.

House Republicans, led by Congressman John Boehner, are calling for cutting $100 billion from the federal budget, excluding military and police agencies.

While governments at all levels are preparing more attacks on the living standard of working people, some businesses are faring better, at least for now. Bloomberg news service reported that “Manufacturing in the U.S. expanded in December at the fastest pace in seven months, reinforcing signs the expansion is gaining momentum.”

But an uptick does not necessarily mean more jobs. The bosses prefer to boost production through speedup, not expanded hiring.  
‘Everything on the table’
In a New Year’s Day editorial, the Times cautioned that “cutting too deep, too fast will stall the recovery.”

But at the same time the paper argues that more cuts are needed and “everything will have to be on the table, including entitlements and defense.”

By everything on the table they mean wages, jobs, pensions, health care, and social security. One item not on the table are the interest payments to banks and bondholders. New York State debt service spending is expected to reach $6.4 billion for the 2010-11 fiscal year alone.

Investor’s Business Daily in a December 27 editorial encourages more scapegoating, charging that local governments are being bankrupted “by high wages and gold-plated benefits for public sector workers” and “lavish compensation.” The paper’s solution, besides making workers pay for the capitalists’ crisis? “Outlaw collective bargaining for public-sector workers.”
Related articles:
Defend public employee unions  
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