Biweekly news digest from the California State University Employees Union
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GOV. BROWN SET TO ANNOUNCE PROPOSED BUDGET
DON’T “REFORM” SOCIAL SECURITY TO DEATH
LOS ANGELES TIMES EDITORIALIZES ON CSU OVERSIGHT
MEDIA COVERAGE OF STATE WORKERS
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Gov. Brown Set to Announce Proposed 2011-12 Budget
The broad set of budget cuts that Governor Jerry Brown will propose in the coming days are destined to touch nearly all Californians, eliminating local redevelopment agencies, shrinking social service benefits, shuttering parks and reducing library hours. Brown, who was sworn in on Monday morning, wants to slash virtually every state-funded program in order to help balance California’s massive deficit.
It seems clear at this point that he plans to cut deeply into California State University and the University of California budgets, restrict Medi-Cal access, and divert low-level offenders to county jails.
“Although it appears that the CSU and UC may be getting some cuts in the Governor’s proposed budget, we must wait to see exactly how such cuts are allocated,” said CSUEU President Pat Gantt. “As always, the devil is in the details.”
Brown would wipe out hundreds of local redevelopment agencies, which use property taxes to spur projects in blighted areas, using the savings to offset state budget costs for one year and then giving the money to counties and schools thereafter.
He’s counting on lawmakers to approve the cuts. A possible June special election could include a ballot measure extending higher tax rates on income, vehicles and sales set to expire this year, as well as eliminate a new corporate tax benefit.
Brown, who pledged not to raise taxes without voters’ signoff, would face a daunting mid-March deadline to get his proposals onto a special-election ballot. He has said publicly he wants lawmakers to approve a budget within about 60 days. The process usually drags on seven or eight months.
His budget, likely to be unveiled by the end of the day this Monday, relies largely on permanent cuts with an eye toward reducing a long-term budget problem that the nonpartisan Legislative Analyst’s Office has predicted will hover around $20 billion annually if there aren’t any changes--$28 billion through June, 2012, if shortfalls in this current fiscal year are included. The 18-month deficit is pegged at greater than $25 billion in part because Schwarzenegger and lawmakers relied on rosy assumptions to solve the 2010-11 budget.
Polls show that voters are far more willing to extend existing taxes than to levy new ones. The current temporary tax hikes are all due to end by July 1. Extending them would erase up to $9.4 billion of the $28-billion deficit.
The combination of austere spending and extended tax hikes is designed to confront both parties and their allied interest groups with painful choices that Brown says are necessary to truly resolve the state’s massive budget problems.
“Overall, Governor Brown’s approach of both budget cuts and new revenues is more balanced than our previous governor’s cuts-only model,” said Gantt. “Many states and previous California governors have successfully used this model.”
Don’t “Reform” Social Security to Death
by Dave Hart, President, California State Employees Association
For sheer audacity, the concept that the federal budget will implode without big cuts in Social Security benefits is right up there with the idea that California state workers are responsible for the state budget deficit.
- Social Security currently enjoys a $3.5 trillion surplus, and is 100 percent fiscally sound until 2037. Long-term solvency can be assured by relatively modest adjustments and without cutting benefits—for example by raising employer and employee payroll tax rates, by raising the cap on taxable earnings (now at $106,000) or some combination of the two.
- Social Security has nothing to do with the federal deficit. The social security fund is self-funded—not part of the budget process and prohibited by law from borrowing from the Treasury. According to Congressional Budget Office the deficit is really all about continued tax cuts for the rich, endless wars, skyrocketing health care costs and the continued effects of the recession.
- The President’s National Commission on Fiscal Responsibility and Reform asks nothing of the Wall Street interests that created the current crisis, and asks everything of working Americans. The commission proposes to raise the retirement age to 69, slash benefits by up to 35 percent for middle-income earners, reduce Social Security’s annual cost of living adjustments, and cut health care benefits.
Social Security is not a welfare program, and it’s not an “entitlement.” It is a social insurance fund, supported by the taxes that American workers pay throughout their working lives—from their first summer jobs until the day they retire.
Indeed, the one-year payroll tax holiday is perhaps the most dangerous part of President Obama’s compromise tax package. It will deprive the Social Security Trust fund of $120 billion in annual revenue, and that shortfall will sooner or later have to be made up to sustain future benefits. Can you imagine Congress going for that, in the midst of all the other fiscal pressures it faces? It’s a modest tax break, but it’s a time bomb for Social Security.
On this 75th anniversary of Social Security we need to celebrate the nation’s best anti-poverty program as a reminder of what effective government can do. Social Security was the centerpiece of the New Deal reforms of the 1930s that helped this country recover from the Great Depression. It gave Americans a measure of dignity and hope. The challenge now facing President Obama is to sustain and strength that program, not to undermine it.
Los Angeles Times Editorializes on CSU Oversight
In two editorials last month, the Los Angeles Times weighed in on a variety of proposed measures for greater legislative oversight of CSU and UC finances and management.
In a December 7 editorial, the influential newspaper’s editorial board endorsed SB 8, the reintroduction of CSU transparency legislation authored by Senator Leland Yee (D-San Francisco) and twice-vetoed by Governor Schwarzenegger. The bill extends the reach of the California Public Records Act to include fundraising foundations that function as auxiliaries to state universities. The editorial stated:
“The Legislature should pass it again, and the new governor should sign it. Auxiliaries are arms of public universities established to assist university fundraising. The auxiliaries share offices and staff with their associated universities and sometimes even mingle funds with those institutions. But when the public asks about their practices, the groups claim they are private and thus not subject to the disclosure requirements of the Public Records Act. That’s self-evidently abusive.”
Then, in a December 17 editorial, it argued against any further bills providing oversight of the CSU or UC systems, including Yee’s proposed legislation that would ban pay hikes for top administrators at public universities in bad budget years. Assemblyman Anthony Portantino (D-La Cañada Flintridge) has reintroduced a bill that would create new benchmarks to measure the performance of public university systems and the state’s community colleges. The editorial stated:
“Some legislators in Sacramento think they’ve done such a fine job with the state budget that now they should take over operations at the University of California and California State University. No thanks … The university systems have an obligation to provide excellent undergraduate and graduate education. Micromanagement by the legislature would be the fastest route to educational mediocrity.”
“Legislative micromanagement of the CSU could indeed lead down a counter-productive path,” said CSUEU President Pat Gantt. “To hold the public trust, all public agencies must be held to a high standard, but micromanagement isn’t the solution.”
Media Coverage of State Workers
This Atlantic Monthly article details efforts in a number of states to curtail state worker rights and benefits.
This January 3 New York Times article covers state-by-state efforts to curb government worker unions, and this January 5 Huffington Post article responds to the Times’ article.
Former Secretary of Labor Robert Reich, now a UC Berkeley professor, penned this January 5 Huffington Post article headlined “The Shameful Attack on Public Employees.”
Finally, this recent seven-minute MSNBC video report defends state workers against attacks on their rights and benefits.
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