The White House is set to begin a series of formal talks today with Democratic and Republican congressional leaders on the 2012 federal budget. It is already clear that the Obama administration’s proposal for reducing the budget by $4 trillion over the next 12 years is only the starting point for far deeper cuts, which will be worked out under the pretext of avoiding a government default.
In a statement Tuesday, Senate Minority Leader Mitch McConnell (Republican-Kentucky) said there was bipartisan support to reach a budget agreement before a vote on increasing the debt ceiling. He made it clear, however, that far more savage cuts were necessary. “[I]t is my hope that there will be a new urgency from the White House and our friends across the aisle to finding solutions to what we all know must be done,” McConnell said in a statement.
Obama’s fiscal year 2012 budget cuts billions from public education, transportation, infrastructure, federal pensions, housing, Pell grants and aid to states and cities that are already slashing their budgets. It proposes cost savings by getting rid of “excessive and unnecessary Medicare cost growth” and rewards states for streamlining Medicaid. It also establishes a trigger for across-the-board cuts if the federal budget deficit does not hit a targeted debt-to-GDP ratio by 2014.
This is only a down payment. The Democrats are using Republican proposals to destroy Medicare and Medicaid as a foil in order to posture as more humane budget-cutters. They are preparing to accept a “compromise” to slash entitlement programs and other vital services, while continuing tax cuts for corporations and the wealthy.
With popular opposition to budget cuts growing across the country, Republicans and Democrats at the state level are accelerating anti-strike laws and other anti-democratic measures aimed at criminalizing any collective resistance by workers.
In the past few weeks, such bills have been passed in Massachusetts, Connecticut, New Hampshire, Michigan, Illinois, and Indiana. Similar legislation is pending in nearly every state. Nationwide, according to the National Conference of State Legislatures, some 744 bills have been introduced to attack public employee wages, benefits and collective bargaining rights.
State Republicans in Wisconsin are considering adding the anti-worker legislation that sparked mass protests in February and March into a soon-to-be-voted on budget bill. The aim is to circumvent a legal challenge over the implementation of Governor Scott Walker’s law that strips collective bargaining rights from the state’s 300,000 public employees. The law would also empower the governor to declare a “state of emergency,” allowing for the firing of any worker who “participates in a strike, work stoppage, sit-down, stay-in, slowdown, or other concerted activities to interrupt the operations or services of state government.”
Meanwhile, the first effects of the governor’s $1.5 billion planned cut in state aid are being felt. In its 2012 budget proposed Tuesday, the Milwaukee Public Schools—the largest district in the state—announced the elimination of 1,000 teaching and other full-time staff positions.
In Michigan, Republican governor Rick Snyder signed into law last month a measure that will give so-called Emergency Financial Managers dictatorial powers to usurp elected local governments and school districts, abrogate labor agreements and sell off public assets. Snyder is cutting $500 million from K-12 education and $200 million from higher education.
The law has already been used to take over city finances in the economically depressed towns of Benton Harbor, Hamtramck and Ecorse. (See: “Michigan’s anti-democratic emergency financial manager law takes effect”).
In Detroit, the city’s Democratic mayor, David Bing, has let it be known that he could be given the EFMs power to rip up the contracts of city workers if they don’t accept deep concessions in medical and pension benefits.
Two years ago, Snyder’s Democratic predecessor Jennifer Granholm appointed Robert Bobb as the EFM of the Detroit Public Schools. Bobb is using his expanded powers to sell off 45 public schools to private charter companies and overturn the existing contract with the district’s 6,000 teachers by May 17. On Wednesday, Snyder tapped Roy Roberts, a former executive at General Motors and a private equity manager, as Bobb’s successor. Roy will be paid $250,000 a year in a city where the half the population is unemployed.
Snyder has threatened to appoint EFMs to take over 23 financially strapped school districts if authorities determined that they had at least one “failing” school. The Republican-controlled state government is also considering stripping teachers of their licenses if they strike.
A report by ABC News noted that increasing number of “turnaround experts” from private businesses—experienced in slashing jobs, wages and benefits—were looking forward to lucrative opportunities in consulting EFMs. “Investment bankers, lawyers, accountants and professionals skilled in the restructuring of failing companies see the chance to sell their services to emergency managers.”
“Many of the same techniques and processes used by private sector turnaround firms can be used by public sector clients to avoid insolvency,” Michael Imber of Grant Thornton LLP, a principal in the corporate advisory and restructuring services group of Grant Thornton LLP, told ABC.
There is growing opposition to these attacks. Last Saturday, more than 1,000 teachers, students and other workers protested against Snyder outside of the University of Michigan graduation ceremonies in Ann Arbor. Inside the commencement many UM students and parents booed the governor.
The trade unions that have led these protests, including the state affiliates of the National Education Association, are opposed to any serious struggle against the budget cuts and attacks on the democratic rights of the working class.
Just as in Wisconsin, the unions are seeking to tie teachers and other workers to the Democratic Party, even as it collaborates with the Republicans on a federal, state and local scale to impose massive budget cuts. The unions are promoting recall campaigns and the reelection of Obama in the 2012 because, unlike the Republicans, the Democrats are open to collaborating with the trade union apparatus to force workers to pay for the economic crisis. The slogan of the unions is: “Carry out the budget cuts with us, not against us!”
Workers must reject this. The struggle must be taken out of the hands of the unions by building new organizations of struggle, independent of the unions and the Democratic Party, to mobilize the working class to oppose all budget cuts and attacks on public employees.
The entire framework of the budget debate and the claims that there is not enough money for essential services must be rejected. There are ample resources, but they are monopolized by the financial elite, which rules America and controls both political parties.
A mass political movement of the working class must be built to break the grip of the financial aristocracy, carry out a radical redistribution of wealth and reorganize the economy, along socialist lines, to guarantee the social rights of all working people to a decent paying and secure job, health care, education, housing and retirement.