Detroit workers resist budget cuts & layoffs

Community group says pay workers, not banks

By Abayomi Azikiwe
Editor, Pan-African News Wire
Detroit

Hundreds of city employees and community residents gathered Aug. 19 outside City Hall here to protest budget cuts. Newly elected interim Mayor Dave Bing has already placed over 300 workers on indefinite layoff and is preparing the public for the idling of another 1,000 employees in an effort to close a $350-million deficit.

Detroit city workers tell City Hall: ‘Hands off our jobs!’ WW photos: Kris Hamel

In addition to the layoffs, the mayor is set to make major cuts in bus services, the only source of transportation for hundreds of thousands of workers, students, people with disabilities and seniors. The Bing cuts would suspend bus transportation between 6 p.m. on Saturday and early Monday morning. Other possible cuts would eliminate several bus routes altogether.

The Aug. 19 demonstration was largely organized by the city bus drivers’ union—Amalgamated Transit Local 26. Other unions involved included American Federation of State, County and Municipal Employees Local 207 as well as rank-and-file members of United Auto Workers Local 2334 and the Detroit Federation of Teachers.

Members of the Moratorium NOW! Coalition to Stop Foreclosures, Evictions and Utility Shut-offs carried banners calling for Michigan Gov. Jennifer Granholm to declare an economic state of emergency and place a halt on home seizures and energy cuts to individual households.

Detroit city workers protest cuts.

Public hearings the week of Aug. 24 will allow city residents to voice their opinions on the proposed cutbacks and elimination of bus service routes. With rising unemployment and poverty rates in the city of Detroit, the scaling down and termination of routes would be disastrous for the city’s overwhelming majority of African-American and working class residents.

Severity of crisis deepens

Despite government and corporate claims that the economy is beginning to show signs of a recovery, conditions in the state of Michigan are becoming more desperate for workers and youth as well as small business owners. The official unemployment rate in the city of Detroit stands in excess of 25 percent; the overall figure for the state is over 15 percent.

Home foreclosures remain extremely high. Every neighborhood in Detroit suffers from a proliferation of vacant homes and businesses. Property values for those able to remain in their homes have plummeted.

As a result of the worsening conditions, there has been a recent spike in street crimes involving robberies, carjacking and shootings. The Bing administration has appointed a new police chief, Warren Evans, who has stepped up street sweeps using brutal tactics such as home raids and the deliberate targeting of youthful motorists.

Evans was featured on the front page of the Aug. 16 Sunday Free Press holding an automatic weapon while raiding a home along with patrol officers. There has been no discussion by the Bing administration on the root causes of the economic crisis and the consequent budget shortfall.

On Aug. 12 Bing traveled to Chicago to meet with representatives of the bond rating agencies Moody’s Investor Services and Standard & Poor’s. His stated objective, according to that day’s Detroit Free Press, was to “reassure” these agencies that his administration would take drastic measures to balance the city’s budget.

The same article points out how the bond rating agencies have exercised their power over the fiscal well-being of the city. Reporter Suzette Hackney states, “In January Moody’s, Standard & Poor’s and Fitch Ratings downgraded Detroit’s bond rating to junk bond status as a result of the city’s inability to regain structural balance and ongoing financial deterioration. Approximately $4.7 billion of the city’s debt was affected by the downgrades.”

Hackney goes on to point out, “Downgrades can carry severe consequences for the city. Besides higher interest rates on the city’s debt, depriving the budget of money to fund services to residents, it also could force the city to pay millions of dollars to investors with certain deals with the city.”

The Aug. 23 Sunday Free Press noted that city governments throughout the region will face serious problems in financing public projects. “Soon many cash-strapped governments might see higher interest rates that could make it too expensive to finance public improvement projects that some communities need badly.”

Another article in the same issue notes, “Even Michigan cities that have maintained excellent or above-average bond ratings are at risk of seeing them fall and interest rates rise.”

In response to this pressure, Bing is demanding that workers and residents accept massive cuts in employment, salaries and services. On Aug. 10 an emergency meeting between the city administration and 50 union locals ended in a shouting match as labor representatives expressed their opposition to the drastic cuts.

Bing demanded that the unions accept a 10-percent pay cut by Aug. 28. This wage cut has already been imposed on nonunion employees. The mayor says that the city is running out of cash and could be insolvent in another two months. He has also mentioned that if the workers and city residents do not accept the proposed and imposed cuts, the city could fall into bankruptcy and receivership.

However, even if workers and community residents accept the salary and service cuts, “There are going to be layoffs regardless. At a minimum 1,000 layoffs,” Bing said. (Detroit Free Press, Aug. 12)

Union leaders at the Aug. 10 meeting refused to accept the pay and benefit cuts. Henry Gaffney, president of the Amalgamated Transit Union, representing 1,000 bus drivers, said after the meeting that the city needs to “clean up your own house and then come talk to us.”

In comparison to other public entities and private industry, city workers are grossly underpaid and overworked. Thousands of job openings have remained unfilled for years, requiring employees to perform multiple tasks, while their cost of living increases every year.

Need for worker-community alliance to fight cutbacks

Members of the Moratorium NOW! Coalition at the demonstration outside City Hall called for the suspension of the debt service payments to the financial institutions that have demanded the massive cutbacks in municipal services. “Bing must tell the banks to wait. The workers must keep their jobs and benefits,” coalition members shouted.

They pointed out the injustice of having city workers and residents pay for the failures of the corporate giants and their agents in government. The banking institutions, auto companies and insurance firms have received trillions in bailout money through the government and the Federal Reserve over the last year while workers have suffered immensely through job losses, foreclosures, evictions, utility shutoffs, the slashing of health care and pension benefits.

The Obama stimulus package has not created any jobs for the unemployed and underemployed in Detroit. In fact, it was reported in the Detroit News on Aug. 12 that the state of Michigan is losing approximately $50 million a month due to the drop in income and sales tax revenues.

The coalition has called for a mass organizing meeting Sept. 12 for the workers and community to declare an economic state of emergency in Detroit and Michigan. It will be held at Central United Methodist Church on Woodward and East Adams beginning at 11 a.m.

A leaflet from the group says, “It is time for the people to declare a State of Economic Emergency and plan actions to guarantee our fundamental rights to housing, utilities, education, basic services and jobs in accordance with the law. We will develop a strategy to implement a moratorium on foreclosures, evictions and utility shut-offs; an end to school closings and cuts in public education; guaranteed health care and basic social services for poor and working people; defending union contracts and workers’ rights to living wages and pensions; ending plant and office closings and lay-offs; and guaranteeing the right to a job consistent with the Full Employment Act.”

---