A few hours ago, the Public Employees Federation rejected a contract offer from the Andrew Cuomo administration. One of two major state employee unions in New York, PEF's rejection follows acceptance by the larger Civil Service Employee's Association of their contract offer from the state. The Cuomo administration has insisted all along that either the unions make concessions or prepare to suffer layoffs, as part of the plan to close the state budget gap.
The rejection leaves Cuomo in unfamiliar territory. Cuomo defeated an extreme right wingnut candidate, Carl Paladino to take the office, and quickly distinguished himself from his hapless predecessor David Paterson, the 'accidental governor' who took office after Eliot Spitzer resigned in disgrace. Cuomo has been governing in a forceful but effective manner, getting an on-time budget out of one of the most dysfunctional legislatures in the country, getting gay marriage legalized in New York State after years of dithering, and generally racking up high approval ratings while going out of the way to portray himself as pro-business.
The PEF rejection of the contract offer sets up a conflict that could force a re-examination of Cuomo's governing philosophy and beliefs, with much larger implications for Democrats nationally. Cuomo is establishing himself as a credible candidate for the White House in 2016; but his corporatist approach may prove tricky with the growing desire for a return to more populist Democratic roots.
Since becoming governor, Cuomo has worked to insulate himself from traditional Republican attacks. As a Democratic governor in one of the bluer states, Cuomo has been emphatic in rejecting taxes as a way to close the state budget gap. Pushing through caps on property taxes, cuts across the budget, and rejecting any extension of the state's expiring 'millionaire's tax' (a surtax on those making more than $200,000 a year), Cuomo has actually found himself more comfortable at times with the Republican State Senate than the Democratic Assembly.
Cuomo has been positioning himself as a pro-business, anti-tax corporate Democrat, fiscally prudent while socially liberal. As governor of New York, he's a de facto player in the world of Wall Street and the New York media nexus. As such, he's been careful to stay on the good side of the Street, Mayor Bloomberg, and the Murdoch NY press establishment.
Consequently, the state employee unions have come in for more than a little attention from the Governor. Negotiations over new contracts for both CSEA, PEF and other state employee unions were accompanied by promises that if the unions did not agree to concessions, layoffs of up to 9,600 were guaranteed. Pink slips were issued at one point, to alert workers on the chopping block. (And concentrate their attention, no doubt.)
State employee unions are a part of the traditional Democratic political base in New York State; Cuomo has gone out of his way to show he is not reflexively pro-labor. Anything but. He's worked hard to establish himself - and New York - as pro-business. The PEF contract rejection today is an unwelcome distraction, coming as it did during a big conclave of high tech companies wooed into the state, including an appearance by the Big Dog himself, Bill Clinton.
The CSEA - PEF divide highlights differences between the two; PEF split from CSEA 34 years ago, in response to a divide and conquer strategy - which worked. PEF employees came from a bargaining unit concentrated among the higher grade levels; there's something of an income and education differential. CSEA employees may have felt they had too much to lose to reject the contract, given how difficult finding work at those levels is these days. PEF members may have felt they were being asked to give up too much - especially since Cuomo is going out of his way to reassure millionaires that they are safe with him.
How much popular support is there for the unions? At a guess, not much given the anti-government, anti-labor bias carefully inculcated by the right wing over the decades. Cuomo is certainly not pushing back against it. But the growing awareness that the rich in this country have been playing us for suckers may change that. PEF President Ken Brynien's statement on the contract rejection tries to raise the fairness issue:
“The decision to reject the tentative agreement was made by our rank-and-file members who clearly feel they are being asked to sacrifice more than others, particularly in light of the pending expiration of the state’s millionaire’s tax.
“We will ask the governor to direct his negotiators to immediately return to the bargaining table to workout an agreement which our members will ratify. We are calling on the governor to resist laying off thousands of our members as he has threatened and, instead, work with us to identify savings that would preserve the state’s depleted workforce and services, especially during this economic downturn and in light of the recent flooding,” said Brynien.
emphasis added
What comes next depends on how Cuomo intends to play this, and how far ahead he's thinking. He's building the image of a hard-headed effective leader, not beholden to special interest groups, making the hard choices to get things done - and could bolster it by laying off people to cement his credibility. To paraphrase Teddy Roosevelt, carry a big stick and use it while speaking loudly.
Or, he could frame it very differently. He could state he's disappointed that PEF members voted to reject an offer the state made based on what was needed to assure the financial health of the entire state. BUT... he would forgo layoffs while the state is still recovering from the massive damage from Hurricane Irene and needs the continuing help of all state employees in the recovery efforts. Now is not the time to add to economic distress - especially since many state employees themselves were victims of the storm. Therefore, the state will return to negotiations in the spirit of mutual cooperation that has made New York the Empire State. And so on.
The risk to Cuomo is ending up on the wrong side of history. He's already having to stretch a pretty wide credibility gap supporting Obama's call to tax millionaires while resisting it in New York. If popular support for that continues to grow, he's going to look ridiculous - especially if the economy stalls out. Then there's what's happening next door in Massachusetts. If Elizabeth Warren's campaign catches fire and blows away Scott Brown, Cuomo would have to be completely tone-deaf to miss the implications.
Cuomo was also trying to be a little too clever with the contract negotiations. Trying to get PEF to agree to wage freezes, increased employee contributions for health care etc. and limited incentives toward the end of the contract was ambitious enough - but he was trying for 5 years. That would have put it safely past the next gubernatorial election and deprived the union of negotiating leverage for the next contract.
Now, Cuomo risks coming into next November 2012 with the unions pissed off at him at a time when Democrats are going to be locked in a nation wide death struggle with the Republicans. He's already having trouble with the legislature over redrawing district lines. If he loses union GOTV help and depresses turn out in New York, that could have implications for Obama's reelection.
Republicans are deliberately targeting government employees, unions, and other traditionally Democratic bases of power everywhere they can around the country. While this isn't the unrestrained purge being seen in Wisconsin and elsewhere, Cuomo isn't helping himself or any other Democrats by trying for a 'kinder, gentler' version of that while sucking up to increasingly arrogant and unpopular corporate oligarchs.
So, when 2016 rolls around, where will Andrew Cuomo be coming from? How he responds to the PEF contract rejection will tell us.
Disclosure: the writer of this diary is also a member of PEF.
Wed Sep 28, 2011 at 6:18 AM PT: Update: statements from the governor's office indicate a hard line response. Lay offs will begin immediately and there will be no new negotiations. Either accept the contract as given, or be prepared to be out the door.
The State Taylor Law prevents state workers from striking - but the old contract stays in effect until a new one is accepted. This pits 'safe' workers against those being cut. There's a lot of unhappiness here. Meanwhile, Cuomo's already high approval ratings will probably go up. Beating up on union members and government employees is a winning strategy so far.
Meanwhile, no millionaires have been harmed - which is the important thing. (snark)