The Mayor gave a press conference on his budget, and talked about how he hopes to fill a $4 billion gap with concessions from labor on pensions, wages and health care, and a reversal of the Governor’s proposed cuts to the city’s education budget.
Governor Paterson has asked that the state withhold $770 million from our education allowance, but Bloomberg says that the Federal government will give the state education money and that should be used to make up the city’s shortfall. Failing that, he expects to cut 14,000 workers from the Department of Education out of 23,000 city job cuts — “mostly by attrition” — previously leaked.
Bloomberg many times praised the Governor’s “courage” in making “hard choices,” but called upon the state legislature to reject the city education cuts.
He also said several times that the city will need to “negotiate” with the unions to roll back labor costs. Pension and health care “have bankrupted Detroit [and] the airline industry,” he said, and we could save money by requiring givebacks — for example, he said, health plans could involve co-pays: “Virtually no other industry” does without them, he said.
The Mayor confirmed that he would seek a 0.25 increase in the sales tax — lower than previously reported, putting it at 8.4 percent — and a tax on clothing sales, though this and everything else is contingent on the city council. The Mayor will consider other taxes, including Richard Ravitch’s proposed “mobility tax” on out-of-towners working in New York.
He stressed that new city revenue for 2009 is expected to be $3.3 billion lower than in ’08, leaving us in 2010 with “$5 billion less to spend than we had in ’08.” At the same time, city expenses will go from $41.2 billion in 2008 to, in Bloomberg’s “best guess,” $43.3 in 2009.
He spent a good deal of time going over the parlous state of the national, state and city economy. National GNP “forecasts are dismal, with domestic growth negative of two or three percent,” he said. “In housing, nobody’s ever seen a decline like this.” And consumers, who were “bearish when the economy did fine,” are “afraid… people are getting hamburgers instead of steaks.” Also, unemployment claims are “skyrocketing.”
New York is looking at 300,000 job losses, he said, representing a “$39 billion in reduction in wages in this city.” Wall Street’s expected 46,000 lost jobs are even worse, because “when Wall St catches a cold it’s a very serious illness to us.”
He said that all city workers would pick up the slack: Sanitation workers “will have to pick up more tonnage on every route,” and fire companies may lose one of the five men it uses on ladder companies.
He also praised his Administration for its fiscal restraint in the past and present. “We’ve taken precautions, we’re saved for the future… there’s no danger whatsoever of our making the mistakes of the ’70s.”