Bloomberg Warns Successors Of Disasterous Union Contracts

Mayor Michael Bloomberg spoke to Brooklyn on Tuesday to give an update on New York City's fiscal progress and challenges. The challenges Bloomberg addressed focused on unreasonable municipal union demands and outdated contracts. Bloomberg chided union leaders saying, "They have rebuffed our efforts to reform pensions and health care in ways that could produce savings that could fund future raises. Instead, they have decided to wait us out and seek a better deal with my successor." "The question is: Will the next mayor continue to hold the line – or capitulate?"

TRANSCRIPT (As prepared for delivery):

MAYOR BLOOMBERG: About 95 percent of our employees and retirees contribute nothing – not even a dollar – to their basic health care premiums. Compare that to state government, where more than 90 percent of workers contribute to their premiums – usually between 10 and 20 percent. We have sought a reasonable employee contribution to healthcare premiums for years... and beginning in 2010, we made it a mandatory condition of any new labor contracts. We’ve held to that commitment, but no union has been willing to sign a new agreement with that provision. So this year, in addition to our $8 billion per year pension bill, we’ll spend $6.3 billion on health insurance – almost double what it cost us when I first came into office.

BREAK TRANSCRIPT

MAYOR BLOOMBERG: The next mayor will have an unprecedented opportunity to win pension and health care changes from the City’s labor unions – and I’ll tell you why. The municipal unions are working under contracts that were due to expire three and four years ago, but because of the State’s Taylor Law, they remain in effect until new contracts are signed. That means the hours, wages, benefits, and raises that are built into those contracts continue.

For instance, a teacher with five years of experience in 2008 making $58,000 has continued to get raises, and is now making $79,000. So when the union leaders say they don’t have a contract – they do. But they are demanding new contracts with retroactive raises – going back three and four years – on top of the raises they’ve already gotten. Now, I believe New York City has the best workforce in the world – and I’ve been proud to increase salaries to help attract and retain the best. But given the fiscal realities we face, we can’t afford retroactive raises. In any case, the unions cannot give us retroactive productivity savings to pay for them.

BREAK TRANSCRIPT

MAYOR BLOOMBERG: And remember: During the Great Recession, most people in the private sector, who pay the salaries of our municipal workers, did not get raises – and many took pay cuts to hold onto their jobs. Governor Cuomo and union leaders in Albany both deserve credit for signing contracts with three years of zero-raises and an increase in employee health care contributions. But the City’s unions have refused to take that deal. They have rebuffed our efforts to reform pensions and health care in ways that could produce savings that could fund future raises. Instead, they have decided to wait us out and seek a better deal with my successor. The question is: Will the next mayor continue to hold the line – or capitulate? Will he or she strike as good a deal for taxpayers as the Governor did – or better?

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