Sunday, April 26, 2009


Union concessions and taxes vs. furloughs? They’ve got to be kidding

by Larry Geller

Don’t believe them.

Legislators have approved a range of tax increases aimed at achieving a balanced budget to avoid wage cuts or layoffs of state employees. Gov. Linda Lingle's possible vetoes of tax measures and the question of whether her vetoes will be overridden will prolong the uncertainty. Increasingly, layoffs and furloughs seem probable if the economy continues to deteriorate.

The refusal of Hawaii's public-employee unions to consider wage cuts or furloughs could backfire. New York Gov. David A. Patterson has threatened to lay off 9,000 of that state's 200,000 workers if they refuse to agree on concessions, and that scenario may be repeated in Hawaii if conditions worsen. [Star-Bulletin editorial, Tax bills, layoffs near face-off, 4/26/2009]

Guess what—even if unions agree to significant (and damaging) pay cuts, they will get layoffs and furloughs anyway. There are no guarantees in politics. I think the unions know this. It would be naive to accept cuts up front in exchange for an empty promise of no furloughs or layoffs. Whatever can be done to union members within the restrictions of their contracts will be done to them. You can bet on it.

The editorial fails to mention that New York’s governor is proposing extensive new taxes and has also increased income taxes on high earners. Lingle opposes increasing taxes in Hawaii on high earners. Her preference to take it out of workers’ hides is not likely to reverse her unpopularity or do Hawaii’s Republicans very much good.

Speaking of Republicans, I wonder why there isn’t a strong third-party movement in Hawaii just now? We seem to define “non-partisan” as being balanced between Democrats and Republicans. It wouldn’t take very many Greens in the legislature to make a significant difference. There are only two surviving Republicans in the Senate, for example.

It would be interesting to see some other party move into the vacuum created by the retreating Republicans here and win some seats in the next election. A party of the people and for the people might be very timely right now, particularly if they propose some sensible economic policy and can avoid taking corporate handouts. Not that corporations would support a third party anyway, so that part is easy.

We could use some new thinking, fewer czars, and less dumb deregulation in response to what we are getting (old thinking, czars, and dumb deregulation).

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