New York, the municipal unions agreed to go without a pay raise after the city announced that it had a mammoth deficit.
But in Washington when the mayor announced that, despite a $400 million budget deficit, he would find money to give city workers a 5 percent pay increase the next year, city workers threatened court action and a strike because they wanted a 9 percent pay raise.
"The most difficult puzzle in restructuring city finances is getting rid of unnecessry workers and keeping city wages down," says Felix Rohatyn, the head of New York City's Municipal Assistance Corporation. "Most cities have too many people working for them, more than they need. But no politician wants to be known for having fired people. That's a puzzle no one has solved yet."
yrohatyn's words ring true in the nation's capital. Nowhere is the problem of how to handle the layoffs, pay cuts and the firing of city employees in hard financial times so puzzling as it is in the home of government bureaucracy and government workers.
"I've worked in other cities and I've never seen any city workers like these," says Elijah Rogers, Washington's city administrator. "They had Martin Luther King's birthday off the other day, they had the inaugural off, and when the hostages came home they were calling up and getting angry because we weren't giving them that day off."
When the District's financial crisis became known in 1979, Mayor Barry repeatedly announced that there would have to be layoffs if the city was to survive. Several hundred reduction-in-force (RIF) notices were sent out telling employees that they would be fired.
But after all the RIF notices and the mayor's claims that he could barely sleep at night because he was worrying about the people he had fired, only 181 city workers, out of more than 32,000, were ever fired. That's right, 181. The only other staff reductions the city managed to make were through an early retirement plan that prompted 668 people to get out of the government by giving them full benefits; although they were retiring several years early.
So for all the talk of people losing jobs to the city's budget crisis, few District workers ever felt any pain; in fact, the major effect of the early retirement plan was to increase the city's budget problems by increasing pension costs. The wave of retirements also robbed the city of sonme of its most experienced staff.
The bottom line in the mayor's effort to cut the size of the city government is that, with the early retirements, a few firing and 500 regular retirements Mayor Barry only managed to cut the city's payroll by about 1,000 people, or 3.2 percent.
There is more. In the District, city workers expect to get every pay raise that goes to federal government workers. That is why they were threatening the mayor with court action for giving them only a 5 percent raise -- federal workers were receiving a 9 percent hike. That dspute has not been settled yet.
This trouble hits Washington especially hard for a couple of reasons. First, government -- federal and local -- is the major employer here. In Detroit, city workers can see the large layoffs at the Chrysler plant or the tire manufacturer. The message is clear that if private industry is in trouble, then public employees are going to have to live with layoffs and few, if any, pay raises. City workers in Detroit also feel pressure from unions that represent auto workers to do their share to keep taxes down and businesses in the city.
In Washington, the biggest union represents government workers.Any 12th grader will tell you that on the day after graduation he is "going downtown to work for the government." The government is thought of as the employer that cannot be shaken by inflation or recession. In essence, the government -- local government, in the particular -- is the employer of "last resort" in the District; people believe the government has a responsibility to hire those who can't find jobs elsewhere. This must be the only city in the world where an opinion poll, done by The Washington Post, could find that people would prefer tax increases to the firing of city workers.
Now city officials have announced that the District has yet another possible deficit for this year, about $60 million. The first logical step in a city where a large slice of the budget pays for salaries would be to layoff workers. But Mayor Barry has decided that programs and city services to people who live in the city -- not city jobs -- will be cut.
In fact, city officials are only now dealing with the possibility of a $60 million deficit out of deference to city workers. Elijah Rogers says the city knew last October that steps would have to be taken to deal with the deficit, but because of hiring freezes and programs cuts in prior years, "workers morale was low."
"You think people are complaining about how city workers answer the phone and deal with them now?" said Rogers. "If we had started laying off more people last October and made more program cuts, the people in the city would have found out how rude city workers can be."
Mayor Barry is trying to not only to avoid angering city workers but also to raise salaries for top city workers who already earn about $50,000 a year. The mayor feels those people do not earn enough to resist the temptations of higher pay from other jobs that are available to smart, skilled people. If the city had extra dollars to spend, the mayor's thinking might make sense. But with an almost $400 million deficit (possibly larger after this year) hanging over the city, the mayor should be reducing the number of his top aides, not trying to give them raises.
The mayor might also take a look at city agencies: the services of some overlap -- for example, the Mayor's Office of Emergency Preparedness and the police department. Other examples can be found among the Office of Planning and Development, the Office of Economic Development and the Department of Housing and Development. Then there are some agencies performing services that, however useful, are non-essential to money-strapped governments, including surely some of the District's 140 board and commissions.
There is fat to be found in the city government. Now is the time for the mayor to start getting rid of it