On December 12 I attended the Center for Working Families New York State Policy Conference. Attendees were mostly activists and representatives of community organizations, trade unions, and state level politicians. The topics that were covered included addressing the state budget deficit with progressive tax reform, campaign finance reform, economic development and jobs, affordable housing, affordable quality healthcare, and green jobs/green homes.
There will be a mobilization in Albany on January 13.
I want to give you a brief report of what was discussed in the sessions I attended (sessions on different topics took place simultaneously) because there was much that should be of interest to Wespac activists.
The keynote was given by Steve Fraser, historian and author of Wall Street: America’s Dream Palace (which I am definitely going to read). In sum, he said that we are in a period of fundamental change, resulting from a systematic breakdown of the pillars of a society based on financialization of the economy, deregulation, deindustrialization, crony capitalism, and the lowering of the social wage. The ruling ideology has been de-legitimatized by the failure of the financial economy, government bailouts, and exposure of massive corruption. This creates an opportunity for new solutions that hasn’t existed for many years.
Balancing the State Budget:
Frank Mauro of the Fiscal Policy Institute pointed out that the state budget deficit largely reflects commitments made in earlier years to provide greater funding for education and healthcare – county obligations which would have been funded by property taxes had the state not agreed to increase its contributions. The issue is not that state spending is "out of control."
Wall Street, via corporate and income taxes, provides about 20% of New York State revenues. That clearly will not be the case in the current years. However, the tax cuts enacted between 1994 and 2005 are now reducing state revenue by more than $17 bn. per year. (This is the entire amount of the budget gap projected by Governor Patterson). The Fiscal Policy Institute is proposing increasing the state tax rate on incomes over $300,000 and instituting a progressive tax rate with a top rate of 10.3% on incomes greater than $1 mn. There is growing support for a progressive tax increase, a statement underlined by State Assemblyman Carl Heastie who pointed out that New York State essentially has a flat tax, with someone with an income of $40,000 paying the same rate as someone with an income greater than $1,000,000.
Ed Ott, from the New York City Central Labor Council, emphasized that any economic stimulus plans have to include pay equity and the right to organize. Infrastructure programs can’t meet all the job needs out there. There need to be programs in education and healthcare, as well as other areas to provide opportunities for service workers. We need to recapitalize public housing.
Economic Development and Jobs:
Annette Bernhardt from the National Employment Law Project emphasized we are dealing with 30 years of policy retreat resulting in greater wage inequality, lower benefits, lower real wages, fewer rights for workers. New York State currently spends $3-$4 bn. per year on economic development with little tangible results. There is no accountability or transparency to the spending. For example, Walmart received $12 mn. in tax exemptions between 2002 and 2005, and created only 198 jobs vs. the 549 that were promised. The tax benefits received work out to 2x the amount paid to workers in the jobs that were created.
The New York State minimum wage, currently $7.15, needs to be at least $10.33 to be in line with inflation since 1970. New York State has the lowest minimum wage in the Northeast, trailing all the New England states by a substantial margin. She proposes the minimum wage be raised to $9.50 in steps by 2011, with automatic cost of living increases. Unemployment payments are similarly pathetic. In New York State, the maximum benefit is $405 per month compared to between $520 and $630 in various other states in the Northeast. Meanwhile, New York has the highest cost of living. New York State’s unemployment trust fund is in weak shape but could be replenished by an increase in the percentage of payroll that is taxed to pay unemployment benefits.
Carrie Brunk, of Jobs with Justice, called for immediate reform of New York State’s Industrial Development Authorities. The IDAs, which provide financing and incentives for economic development and jobs creation, have been a failure. Of $500 mn. in incentives, $135 mn. has been given to projects that either eliminated or created no jobs at all. We need to set standards for projects: they must pay the prevailing and a living wage and offer apprenticeship opportunities, they must hire locally, they must meet environmental and planning standards. We need accountability: community representation rather than just business representation. We need clawbacks for projects that don’t meet the goals they have set. We need to require community impact statements and post-project assessments of whether the goals have been met. We need public, publicized, accessible hearings on every project. The State Assembly has passed an IDA reform bill, but the Republican controlled Senate never allowed it to come to a vote. This reform and the reform or elimination of the similarly troubled Empire Zones program could save $650 mn. in taxpayers’ money.
State Assemblyman Richard Brodsky concluded by describing the Yankee Stadium project as the poster child for waste and crony capitalism. $1 bn. in tax breaks to produce 15 jobs.
Green Jobs/Green Homes
Participants were Elizabeth Yeampierre (NYC Environmental Justice Alliance and UPROSE), Myles Lennon (Urban Agenda and NYC Apollo Alliance), Emmaia Gelman (Center for Working Families), State Senate Eric Schneiderman, and State Assemblymen Marc Alessi and Darryl Towns. The panel highlighted a Center for Working Families white paper proposal which would create a state program to retrofit homes in lower income areas for energy efficiency to be paid for with savings from utility and oil bills. This is a program that could create 50,000 jobs, retrofit 1 million homes, reduce peoples’ energy bills by 30%, and cut greenhouse emissions.
Panelists agreed that, to succeed, this needs to be led from community based organizations, and the jobs initiative is key.