Union Tops Complicit with Democratic NY Governor

Stealth Attack on Public Workers’ Pensions

NEW YORK CITY—A significant anti-labor attack took place in early December when state lawmakers in Albany introduced and passed in a single day legislation that created a new “Tier 5” pension for most new state and municipal workers hired after January 1. This gutting of hard-won pension rights was orchestrated by Democratic New York State governor David Paterson, who announced that over $35 billion will be cut from public workers’ pensions over the next three decades. These savings for the capitalist government will come from forcing most new-hires to accept higher deductions in each paycheck and to work longer before retiring. Pension eligibility will be raised from 55 to 62 years and the minimum service to draw a pension will increase from five to ten years.

This stealth attack on pensions is one sign that it is open season on labor in Obama’s America. The financial meltdown of American capitalism has set off budget crises in states across the country (see “The California Budget Crisis and the Bankruptcy of American Capitalism,” WV No. 941, 28 August 2009). In turn, state governments controlled by Democrats and Republicans alike have taken a cue from the White House, which wrested massive concessions from the United Auto Workers (UAW) as a condition for the GM and Chrysler bailouts. They are using the budget crises to push through layoffs and slash wages and benefits. This is a union-busting drive aimed at public workers, who now, for the first time, make up the majority of union members in the U.S.

Last summer, Paterson threatened mass layoffs to get union bureaucrats from the state’s two largest public employee unions, the Civil Service Employees Association and the Public Employees Federation, into backroom negotiations to cook up a new pension tier. The pro-Democratic Party union tops sold out in a heartbeat, even agreeing to 7,000 job cuts through “aggressive attrition” instead of layoffs. The new “Tier 5” pension does not apply to most New York City public workers, although a version does apply to newly hired teachers. “Tier 5” also doesn’t apply to transit workers employed by the state’s Metropolitan Transportation Authority (MTA), although it is only a matter of time before billionaire Republican mayor Mike Bloomberg and the MTA attempt to force “parity” on transit and all city workers.

Notably, the MTA’s demand for a new “Tier 5” pension from Transport Workers Union (TWU) Local 100 was the main provocation that sparked the 60-hour NYC transit strike in December 2005. Then-TWU Local 100 president Roger Toussaint declared beforehand that the union would not sell out “the unborn” (future hires). But with transit workers on the picket lines fighting against tiered pensions, a threat facing all city and state public workers, city labor leaders refused to support the strike. This was an expression of their de facto support to the slave-labor Taylor Law, which outlaws New York State public employee strikes. United labor action to smash the Taylor Law would have been key to winning the widely popular transit strike. In the end, the strike staved off a “Tier 5” pension, but Toussaint & Co. did grant the MTA a huge medical care concession while scuttling the strike without a contract in hand.

The sellout TWU bureaucracy went on to support the gubernatorial campaign of Democrat Eliot Spitzer, who as state attorney general hit Local 100 and its members with massive Taylor Law fines and even put Toussaint briefly in jail. With Spitzer’s demise, the union tops enthusiastically embraced Paterson (whose father, longtime Democratic Party operator Basil Paterson, was a paid advisor to Local 100 before and during the strike). But Paterson has only proven yet again that reliance on the capitalist Democratic Party is a losing game. In fact, Paterson has delivered a blow to union pension gains that former Republican governor George Pataki and the MTA could only dream about.

For the union bureaucrat, resigned to forking over concessions to the bosses, it does not take much to accept new tiers: existing workers are supposedly “not affected” while yet-to-be-hired workers cannot vote. But what follows is corrosive to the union. New workers are soon toiling at the same jobs for less, fueling dissension within a layer of second-class union members, who are less likely to defend either the union or more senior workers. Once the new tier is in place, the bosses inevitably come back to knife the older and retired workers with their so-called “Cadillac” pay and benefits. The 2007 contract brokered by the UAW tops allowed new-hires and temporary workers to make half as much pay for doing the same work as existing UAW members. Soon after the Big Three, helped by the bailout deal, greatly accelerated plant closings and layoffs to drive senior workers out of the workforce. Labor must demand: Equal pay for equal work!

American workers’ dream of a “comfortable retirement” is a sick joke these days. Bourgeois ideologues, think tanks and media mouthpieces rail against government employees who still have “defined-benefit” pensions, which have been shredded in the private sector. The notion that companies “owe” workers a few dollars to live on when they retire is considered antiquated. Defined-benefit pensions have largely been replaced by 401(k)s, mostly paid for by the workers themselves, with actual benefits dependent on the vagaries of Wall Street parasites. In 1983, 62 percent of American workers had a defined-benefit pension plan, but only 17 percent had them in 2007. Large corporations often loot their pension funds, and bankrupt ones simply unload their liabilities onto the Fed’s Pension Benefit Guaranty Corporation, which then doles out pennies on the dollar.

With workers made to “sacrifice” to prop up the flagging capitalist economy and bloody U.S. imperialism, the response of the trade-union bureaucracy has been to maneuver for crumbs while peddling a false unity of interests with the bosses. New York’s public workers unions represent transit, sanitation, hospital and highway workers with enormous potential power. But that power is consciously squandered by the union misleaders whose allegiance to American capitalism and the Democratic Party has tied labor’s hands for decades. The all-sided attacks on workers today pose pointblank the importance of having a class-struggle leadership. The fight for a new leadership of the unions is part and parcel of forging a workers party to fight for a workers government and the expropriation of the capitalist class.