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Vallejo Bankruptcy and Public Workers
Source Joel Schor, Peace and Freedom Party
Date 11/02/19/02:08

Vallejo Bankruptcy and Public Workers
An article written by Joel Schor of the Solano County chapter of the Peace and
Freedom Party.

In May of 2008 Vallejo began to make the news in the Bay Area and world by a
unanimous vote of its city councillors in favor of filling for Chapter 9 bankruptcy in San
Francisco Federal District Court. In the weeks and months to come Vallejo's city
manager Joe Tanner would support the case for bankruptcy by blaming the public
sector unions - police, fire department, and electrical workers for pushing the cities
general fund into the red. While the federal judge had ruled in favor of allowing the city
municipal bankruptcy protection in September 2008, the rapidly downward fall in real
estate prices would also entail a fall in property tax revenues for the schools and county
services - which are supplemental to the city such as with sherifs who assist local law
enforcement. Further, the real estate crisis is leading to a population flight from Vallejo
due to foreclosures, which in turn lowers the city's revenue base from local economic
activity. The push for bankruptcy was entirely focused on the unions as the culprits of
Vallejo's economic troubles, and Stephanie Gomez emerged as an anti-union political
force on the city council. In the midst of the bankruptcy proceedings, the unions came to
the city offering $10 million in wage and benefit cuts. The offer was refused, and the
cities negotiator claimed that employee wages and benefits were completely
responsible for the $16million deficit in the general fund. The judges ruling in favor of
bankruptcy, granting the city protection against its creditors, would make evident that
dissenting views and a participatory dialogue over the cities priorities would not be
City manager Tanner made misleading statements in 2007 to the press regarding a city
funded public opinion survey, polling Vallejo residents on their support for higher taxes
to pay for municipal utilities and emergency services. While claiming the public was
opposed to voluntary tax assessments and refusing to release the results of the study, it
was not until April of 2008 that the Vallejo Times Herald obtained the poll results and
reported that there had been in fact a 53% margin of support for increased taxes.
Tanner also attempted to forbade city employees from participating in public debate on
the cities bankruptcy proceedings on internet forums, or making statements to the
press. In the wake of costly and protracted negotiations in attempting to void the city
employee union contracts, the council eventually put forward measure A to Vallejo
voters in June of 2010. The measure called for the end of binding arbitration for city
employees, and for the city council to have the final power in setting wages and benefits
for city employees. Without binding arbitration any group of workers is deprived of their
right to have contracts entered into through collective bargaining agreements enforced
by law. A united working class movement which could bring Vallejos community together
around issues such as the abuse of police power towards the homeless, minorities and
youth, along with standing up for public sector workers is needed. The mismanagement
of the city and local politics has encouraged long time Vallejo residents, Bob English
and Linda Hewitt to become “fed up” in their own words, and leave to find another area
for their retirement. Bob and Linda, both coming from unionized public sector
backgroundsʼ, attended city council meetings during the bankruptcy deliberations and
spoke against the tirade of local politicians demonizing city workers as the cause of
Vallejoʼs economic problems.
The attack on public workers has taken on a national character with President Obama
proposing a two year wage freeze for federal workers in January of this year, which has
emboldened governors of various states to jump on the anti-public employee
bandwagon. In a recent cover page edition of the Economist magazine, The Public
Sector Unions - The Battle Ahead,
articles inside make the case that local leaders need
to show real bargaining strength against the “Leviathan” labor unions which impede
social progress with their unruly power over monopolized social services. The article
ends with a warning to local governments, and asks the question;
“But will governments have the courage to tackle the root causes of the problem (such
as pensions) rather than dealing with secondary problems (such as wages)? And will
they dare tackle questions of power rather than just pay and perks?
( The Economist,
Public sector (Government) workers of the world unite! January 8th - 14th 2011 )

The article of course does not mention how workers pension funds are often miss
managed by contracted financial institutions at great speculation and risk. Further, when
markets crash their is no accountability held on these outside investors who undertook
risky and often self serving decisions involving public employee retirement funds. The
attack on public sector employees is an attempt to weaken the working class as a
whole. The Economist article is entirely correct that the struggle is not only economic
but also political. The latest charge against public sector unions in the state of
Wisconsin by Governor Scott Walker, has involved the threat of calling in the National
Guard if labor unions will not concede to the governments demands on wages and
benefits and also relinquish their collective bargaining rights. The hard won rights of
working people to form labor unions and represent their interests in the workplace
through collective bargaining are not the privileges of an elite as Obama, his Republican
followers in local government, and the business press would articulate. The labor
movement movement is crucial to the existence of democracy in a capitalist society. For
both public and private sector employees, unions provide a voice in the workplace and a
means of bettering the lives of working people.

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