< HOME  Wednesday, December 28, 2005

Creditors get wooed; NYC workers, commuters get SHAFT

I can't help but marvel at the stark difference between how our governments, state and federal alike, treat bondholders and creditors and how they treat laborers.
For example, late Tuesday night, "the TWU executive board voted overwhelmingly in favor of a new three-year contract [that] if approved by the rank and file, will end a labor struggle that led to the city’s first transit strike in 25 years."
Some of these guys have been going with the program for 25 years! without taking a stand. And you know it's not because they got everything they wanted over the years--proof that working class Americans are content with the simple things in life.

In contrast, during the last 18 months alone, Greenspan handed creditors untold fortunes by lifting interest rates 13 times to a four-year high. And, creditors didn't even have to ask! (Though, it's possible that they did and that Greenspan obliged.)

What did transit workers have to suffer to get "a three-year deal that would give [them] 10.5 percent in raises over the life of the contract?" They were maligned by city and state officials, scorned by the media and commuters alike, threatened with incarceration, and fined six days pay! WOW, what a deal!

Creditors are not only spared this indignation, but they lounge in the lap of luxury, greeted at every turn with irresistable lending opportunities.

Meanwhile, though under "the proposed [union] contract . . . new workers [are not required] to put money toward their pensions . . . employees [must] contribute 1.5 percent annually to their health plans." Some deal! If that 1.5% happens to be higher than the 3 or so percent annual raise after discounting annual inflation, transit workers get the SHAFT.

And for what? All because the MTA demanded various cuts in pension benefits for newly-hired workers, wanted to raise the retirement age for current workers to 62 from 55, and was apparently reluctant to recognize Martin Luther King Day as a company holiday. Mercy!

The MTA knew that they could concede these issues; they were just playing political HARDball.

After all, the concessions are a great prelude to increased fares in the spring and "[e]ventually [commuters] will end up paying for it,” said one straphanger.

“I think so, because that's just the way it is. In New York, it's like that." Creditors get wooed, while workers and commuters get the SHAFT.


At Thursday, December 29, 2005, Blogger Marc said...

I have been informed by Ben, on the Working Life (Daily Blog) that NY transit workers get a COLA which would make the 3.5%/ year, a pure increase. That would be good. Add in the 1.5% give back for health insurance, and the increase still keeps them ahead of inflation by 2%. That would still be good.

Do the TWU workers in reality get a COLA?

At Thursday, December 29, 2005, Blogger qrswave said...

Marc, thanks for your comment.

I'm not sure whether the workers get a COLA.

(by COLA, you mean cost of living allowance, right?)

I couldn't find the reference to COLA in the link you provided. Please, re-direct me to the exact quote.

At Thursday, December 29, 2005, Blogger qrswave said...

According to this military website: "Over 22,000 service members at 97 locations in the continental United States (the 48 states excluding Alaska and Hawaii) get this Cost of Living Allowance. This payment compensates for a portion of excess costs for non-housing expenses incurred in areas that exceed costs in an average U.S. military location by more than 8%."

If the COLA offered to transit workers is anything like this, it will do little to mitigate the impact of high healthcare expenses that are commensurate with increased healthcare costs across the nation.

At Thursday, December 29, 2005, Blogger Marc said...

The reference was in a post by Ben which he posted on 12/29 at 2:58:52 AM, under the topic NY Says: Health Care for All

The sentence from the paragraph was as follows:

"I'm quite sure that the TWU contract has a wage scale with seniority steps, and the 10.5 percent wage increase would be to the scale, not to individual wages, so it is in fact a 3% + annual COLA in addition to the annual increase."

At Thursday, December 29, 2005, Blogger qrswave said...

Thanks for including the text. My comment above taken from the military site addresses COLA.

If COLA's merely an allowance for costs that exceed the average national cost, then to use your phrase it's basically gobbledigook.

At Thursday, December 29, 2005, Blogger Marc said...

Well, I don't know what it really means in this case.

My understanding, at least from past knowledge, was if inflation went up, and you had a COLA, you were given an increase in wages, equivalent to the CPI, two times a year, or other time as may have been agreed upon.

Since Ben made that statement, and your post sort of contradicted that, I was trying to get clarification.

At Thursday, December 29, 2005, Blogger qrswave said...

Marc, thanks for pointing it out. It's certainly pertinent.

But, I would be careful about whose figures you believe on rates of inflation. Government and quasi-government officials have a vested interest in painting a rosey picture of the economy.

They claim inflation rates are between 2 and 3% annually. Meanwhile, I'm paying $4 for a gallon of milk now, and this time last year I was paying around $2.50. That's NOT consistent with their figures.

At Thursday, December 29, 2005, Blogger Marc said...

You won't get any argument from me there, that's for sure. I have never believed the CPI reports.

Of course many things are included in the CPI, that people don't buy everyday, where prices have actually gone down, i.e. automobiles, computers and other technology items, televisions, etc.

The things we buy everyday i.e. food, energy, local taxes, and health care are going up at a rate faster then inflation.

I could check it out, but would it do any good? Who knows, I am really more concerned with the health care issue.

Sorry, can never resist an opportunity to plug my blog.


Post a Comment

<< Home