Mayor Antonio Villaraigosa and Chief Administrative Officer Miguel Santana are putting the final touches on the budget that the mayor will introduce to the City Council on Friday. All signs are that it will open a bruising debate, with the predictable calls for sacrifice to close a budget shortfall of more than $200 million. Layoffs seem a near-certainty, and the search for new revenue is an inescapable part of the solution.
There is much to bemoan in all of this. No one wants to put more workers on the street in a slow economy, nor is there much enthusiasm at City Hall or elsewhere for tax hikes to prevent even greater cuts. Yes, there is also some credit to be given: Villaraigosa and other city leaders have slashed the general fund in recent years to accommodate the damage wrought by the national economy, and their efforts have helped keep a difficult state of affairs from becoming a catastrophic one. But it's hard to cheer for a bad situation, and this one is very bad.
One contributing factor is the city's method of negotiating contracts with its unions. That job is left to a small group of top officials, but because none of them is individually responsible, accountability is diffused. Moreover, those officials largely owe their offices to the political support of the same unions with which they negotiate, so it is in their interests to err on the side of generosity. In good times, those structural defects of the government are papered over; in bad times, they are all too apparent. The consequences of that relationship are glaringly visible today: A compensation package negotiated in 2007 irresponsibly guaranteed many city workers more than 25% in pay hikes over five years. That was too large and too rigid — the raises were not linked to inflation or any other economic measure — even at a time of growth; today, it is unsustainable. With public attention focused on the ramifications of that problem, now is a good moment to fix it.