Chicago teachers at a picket line / Sitthixay Ditthavong (AP)

This post has been updated to note Rahm Emanuel's increase in the length of the school year.

The Chicago teachers' strike is shaping up to be one of the most important labor disputes in years, with Mitt Romney issuing a statement condemning the strike, and Chicago mayor Rahm Emanuel heading up the city's side. But what are the two sides actually fighting about? Let's break it down, piece by piece.

What do the teachers get now?

Under the currently binding contract (pdf), 2010-11 annual teacher salaries ranged from $47,268 for teachers with bachelor's degree with a year's experience or less, to $88,680 for those with doctorates who have at least 16 years of experience. Those in schools with longer school years (42.6 weeks or 52 compared to 38.6) make commensurately more. All told, teachers in Chicago make an average of $74,839 a year. However, the school board rescinded the scheduled 4 percent pay increase set to take effect this past school year.

Teachers' benefit package includes a choice of three health plans, with maximum out-of-pocket amounts, including deductible, ranging from $4,000 to $4,800 (or 5.3 to 6.4 percent of the average teacher's salary). Teachers do not pay Social Security taxes or receive benefits, and instead receive a public employee pension averaging $41,584 a year for a teacher with 28 years of service.

What do the two sides agree on?

Emanuel has proposed that, instead of the rescinded 4 percent pay increase, teachers see a 16 percent pay increase over the next four years. The unions say they're close to agreement on pay, though they still think higher raises are necessary to make up for rising health costs. The two sides have also already worked out a deal under which additional teachers are hired to implement Emanuel's longer school day.

What do the two sides still disagree on?

The Chicago Public Schools in March unveiled an evaluation system (pdf) in which standardized testing makes up 40 percent of the rubric, which was designed by panels that included teachers, principals, and teachers' union officials (including the president). The system goes above and beyond the state requirement that testing make up 20-40 percent of teacher evaluations. The teachers' unions are resisting this system, calling it too punitive.

Teachers also want laid off teachers to be able to be automatically "recalled" to positions if they open up. Emanuel would allow these teachers to apply to new openings, but given his desire to focus layoffs on worst-performing teachers, does not want automatic recalls. Finally, the teachers' union is demanding smaller class sizes (both to improve working conditions and to improve student learning and life outcomes) and air conditioning for classrooms that don't currently have it.

How does Chicago perform compared to other school districts?

Chicago performs quite poorly on national assessments of educational quality. As Reuters notes, fourth-graders in Chicago performed an average of nine points worse than the big city average and sixteen points worse than the national average on the math section of the National Assessment of Educational Progress (NAEP), the national gold standard for measuring learning. On reading, they were eight and seventeen points worse than big city and national averages, respectively. That's a bit better than Los Angeles or Washington, D.C. but worse than New York.

Chicago also has shorter than average school years and school days. Many students are only in class for 170 days a year as of a few years ago, below the state minimum of 176 days and the national average of 180 days; under Emanuel, the year was lengthened to 180 days. The school day in Chicago averages five hours and forty five minutes in elementary schools (as opposed to the national average of six hours and forty-two minutes) and seven hours for secondary schools, above the national average of 6.6 hours. Emanuel and teachers recently negotiated a deal to hire 500 new teachers to allow for a 90 minute school day extension without increasing hours for current teachers.

What are the city's finances like?

This fiscal year, Chicago public schools are facing a $665 million deficit, one which even raising property taxes to the maximum amount allowed by law and tapping reserves that had been built up by the district in better economic times could not close. For comparison, the district spent about $4.8 billion in fiscal year 2012, so that's a nearly 14 percent deficit that, because unlike the federal government Chicago can't print money, it has to make up. The deficit is set to top $1 billion next year, due to low revenue and the rising cost of pensions, and the schools won't be able to rely on the reserve funds then. The options for making it up include lowering teacher salaries or benefits, closing schools and/or laying off teachers, or raising property taxes.

How are teachers currently evaluated?

Under an Illinois law passed as part of the federal "Race to the Top" initiative, schools must incorporate standardized tests as a "significant factor" in their evaluations of teachers, which the state school board has defined (pdf) as meaning 20-40 percent of those evaluations' content. While the bill is still in the process of being implemented, it will give standardized tests a larger role than they have relative to, say, seniority or education level when determining, for example which teachers get laid off during budget crunches.

What happens to students in the meantime?

The school district's 350,000 students are currently in limbo. They are allowed to go to 144 schools that will remain open for mornings, between 8:30 a.m. and 12:30 p.m., to give kids a place to go for food and activities, but those won't offer instruction. Nonunion charter schools, which serve 52,000 students, are still in operation.

And what about the teachers?

There are 30,000 teachers currently on strike (full disclosure: one of these is my college roommate, who teaches chemistry at Bowen High School). It is expected that the teachers will not be paid, as is the norm during strikes.