Thursday, December 15, 2005

Taking Sides in the Transit Strike

Many commenters and pundits are busy taking sides in the potentially destructive transit strike in New York City. They're either with the MTA or the union.

I think both of those sides are in the wrong, and are not worth siding with in the slightest bit. The only side I'm on are the commuters who rely on a safe and reliable transit system to get to work, school, or for enjoying many of the entertainment options throughout the city.

In the end, the commuters are the ones who are going to be screwed by the outcome, regardless of whether there is a strike or a settlement is reached (by deadline or not). Heck, commuters are going to be screwed if an agreement is reached at any point.

Here's why: commuters are going to foot the bill for whatever agreement that is reached. And forget about that $1 billion surplus. It doesn't exist. It never did. It was unexpected real estate taxes, and that money was all spoken for before the transit negotiations even took place. Most folks are under the misguided impression that the $1 billion will somehow make this negotiation easier and that the MTA should somehow be able to come up with the money. Wrong.

Folks appear to side with the union this time because they think that the $1 billion exists somewhere and that the union should have some kind of profit sharing. Time to set the record straight on that.

Half of that $1 billion is going to shore up the MTA pension fund, which is one of the key benefits for TWU workers. The rest is going to various capital programs, and only a small portion went to the reduced/limited fares from Thanksgiving through New Years. So, that money is all spoken for well before any agreement with the union.

No matter was TWU honcho Roger Touissant says, he can't make that $1 billion appear out of thin air, even though that's what the MTA essentially did. MTA chicanery has gotten the MTA into trouble before, and it's getting them in trouble here. Both in the public relations mess, and in the negotiations because the union knows that the MTA plays fast and loose with the numbers.

However, the union offers on the table are laughable. They initially wanted 8% per year for each of the next three years (working out to an increase of 25.9% after 3 years), and have countered offers by the MTA with a 6% per year for the next three years, plus the status quo on actions against union workers. The 6% salary rate increase is nearly double what most commuters have seen (or will see over the next three years). In fact, the 6% rate increase over the next three years works out to not 18% but 19.1% through compounding the annual increases.

The average salary increase is around 3.5% per year. Is the service that good that they should get more than what the commuters get? With the higher energy costs incurred by the MTA, the budget will need to require additional revenue from somewhere, and commuters will shoulder that burden as well. And that's on top of the generous benefits offered by the MTA for workers.

And in the end, any salary increases will be borne by the commuters through higher fares as the MTA has to make ends meet and balance their budgets.

So, which side are you on?

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