Today's News and Commentary–December 9

Published December 9th, 2013 -  - 12.09.13


According to the Wall Street Journal, teachers across the country will participate in a national “Day of Action” today. The teachers plan to rally to “reclaim the promise of public education.” In New York, teachers will wear blue as they call for more funding and less testing. Politico suggests that, despite this showing of strength, teachers unions are struggling to cope with financial, legal, and public relations challenges.  

The Los Angeles Times observes that a growing number of state and local governments are increasing the minimum wage for local workers. This year, five states—California, New York, New Jersey, Connecticut and Rhode Island—and four municipalities raised their minimum wage above the national rate ($7.25 an hour). With these developments, workers in a record 21 states will be entitled to more than the federal minimum wage next year. And at least five other states are set to consider their minimum wage laws in the near future.

The Los Angeles Times also notes that, Boeing—Washington’s largest private employer—has begun to look outside of Washington for a site to build its new airliner, the 777X. Last month, the International Association of Machinists and Aerospace Workers District 751 voted to reject a contract that would have cut some pension plans and healthcare benefits for Boeing workers, but guaranteed that the program would stay in the Pacific Northwest.

Both the Washington Post and the Wall Street Journal report that, since a federal bankruptcy court entertained the idea of cuts to Detroit’s constitutionally protected public pensions, public pensions in other cities (including New York) have become more vulnerable.  This vulnerability could give cities more leverage to negotiate with unions during budget crises.

According to the Washington Post, labor unions and environmentalists have found some common ground in the debate over natural gas drilling—both groups want to fix old, leaky pipelines that could jeopardize public health and the environment. The effort to fix the pipes could cost $82 billion dollars.    

On the opinion pages, Paul Krugman of the New York Times suggests that cutting off long-term unemployment benefits will not reduce unemployment in our current labor market. He argues that, in an economy with three times as many job seekers as job vacancies, it is clear that employment “is limited by demand, not supply.” In other words, “[b]usinesses aren’t failing to hire because they can’t find willing workers; they’re failing to hire because they can’t find enough customers.” As a result, cutting unemployment benefits will only make the unemployment situation worse by forcing individuals to spend even less while they look for jobs.

Meanwhile, the New York Times Editorial Board questions the “balanced budget” that New York Mayor Michael Bloomberg left his successor, Bill de Blasio. The Board explains that many city employees have been working on expired contracts for years, and unions are demanding roughly $8 billion in retroactive pay. The Bloomberg budget does not account for all of the money that the unions are requesting; rather, it assumes that unions will accept a five-year deal that Mayor Bloomberg has already offered them—no raises for three years, followed by two years of 1.25% raises. But there is no reason to think that unions would accept this proposal.

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