When Jay Walder arrived at the MTA from England last fall, he was supposed to take the reins of an organization that had finally secured some semblance of financial stability. Although New York State had eschewed smarter congestion fee or bridge toll plans, Albany had delivered a comprehensive package of fees and taxes that, while not perfect, should have provided the MTA with enough money to cover its operating deficit.
As with all things these days out of Albany, however, the gold turned to dust. First, Albany took over $140 million from the MTA’s coffers; then, the state taxation calculations were off by over $300 million; and then a still-weak economy cost the MTA millions in missed real estate tax revenue. It was the perfect storm of fiscal problems, and it has led to a deficit of nearly $800 million for the authority this year.
With Walder at the helm, the MTA has tried to make every dollar count, as he is so fond of saying. Since December, when the scope of the deficit has become clear, the authority has instituted on sweeping package of service cuts that will eliminate buses and trains, reduce the in-station employee headcount and lead to longer and more crowded off-peak commutes. Still, that package resulted in savings of just under $400 million with another $350 million gap looming.
To close that gap, the MTA has searched high and low for inefficiencies. The authority has eliminated nearly $50 million in managerial staffing positions, cut 141 capital improvement projects for a savings of $40 million and renegotiated $17 million in contractor savings. Still, the gap is significant, and before pursuing a politically risky fare hike, the MTA is looking for more internal savings.
Today, Jay Walder makes his case for union sacrificies in the pages of The Post. He writes:
As you can see, I won’t shy away from the tough decisions that are needed to drive down costs at the MTA. We are doing our part, but $800 million is a massive shortfall. If we are to succeed, our labor unions must contribute to the solution.
Before I arrived at the MTA, an arbitrator awarded our largest union 11 percent raises over three years. Our employees work extremely hard and deserve to be well compensated – but that compensation comes with the responsibility to maximize productivity and eliminate waste. The reality is that our labor force costs taxpayers far too much. With families and businesses struggling across the state, it’s time for labor to address outdated work rules, limited employee availability and rising pension and medical costs.
Deficit reduction wasn’t what I had in mind when I accepted this job. But I believe we have a once-in-a-generation opportunity to make long-overdue changes at the MTA. By creating a leaner, more efficient organization, we can restore the MTA’s credibility and position ourselves to make great improvements to our system when the economy recovers.
Walder ends his piece on an upbeat note, but it it was encased in an appeal to politics as well. “Here in New York, where transit is more fundamental to our lives than anywhere else,” he says, “it’s something everyone should be rooting for.”
The MTA CEO and Chairman is, of course, striking the right note, but the unions won’t give in without a fight. In a sense, they’re the last holdouts. The riders are losing service from an organization that is a service providers; employees have been laid off; projects delayed; contracts renegotiated. It’s time for the unions to explore how they can help the MTA save money before we all lose our healthy and vital transit network.
20 comments
“It’s time for the unions to explore how they can help the MTA save money”
And the place to do that is in an Op-Ed in the Post?
He knows his audience. Which paper would you assume have the most anti-labor readers in the city? If he wants to get some people riled up about it, The Post is probably the best way to go.
I’m not sure I approve of that approach though. It seems almost unnecessarily confrontational.
This is the way politics works– the TWU understands that. Believe me, they aren’t going to “take offense,” they’re just gonna counter with an Op-Ed/press campaign of their own. Whoever does the best job persuading the public will have a big victory. Good to see Walder/MTA jumping in the ring– all too often they let MTA bashers rule the public discourse.
This is a bad sign. Surely Walder knows the union has “contract law” or whatever it’s called on their side; basically, the only way they’ll give an inch is out of the goodness of their hearts. That said, the union will most definitely blow some of its members dues on their own ads – and as always large segments of the NYC public will eat it up, even when it’s against their own interest to do so. This isn’t looking good.
I disagree with your assessment. Walder is trying to change the dynamics of the debate. This really isn’t about law, it is about politics/policy, which are two separate matters. TWU cannot continue to reach for raises/protect bloated benefits if public support for the MTA is roughly equivalent to that of the union.
Of course it’s about law – contracts are bound by law. The only way Walder can change that is thru the legislature – and we all know whose side they’re on.
The unions are the last holdouts? When did the Legislature give in?
Have you ever heard the myth of Sisyphus?
“If he wants to get some people riled up about it, The Post is probably the best way to go.”
If he wants to get Post readers riled up about it this is probably the best way to go. If people read the Post the Post would make money, as it is it loses money by telling everyone else, public and private sector, what they are doing wrong.
As your other contributors have pointed out an Op-Ed in the post is not sufficient cause to open up a negotiated contract. It is a good way to piss your opponent off, a good way to get the members all pumped up in the union meetings, if that is your goal. Lets see an article in the New Yorker or The Nation, let Walder hold forth over there among all those retired teachers.
Maybe he stayed out of the Wall Street Journal (also owned by Murdoch but occasionally makes money so has a more cred than the decades-in-the-red Post) because that is the paper that sells the MTA bonds, and the MTA bonds are just fine (thank you very much).
“Walder is trying to change the dynamics of the debate”
So where, exactly, is the change. The Post always wants lower wages and benefits for everyone who earns wages. They are outraged that the workers at the MTA get Health benefits but perfectly comfortable with the riders NOT getting Health benefits on their jobs. I’m shocked they think the MTA workers need to take a cut.
This Op-Ed is not about negotiations its about legislation. They think that when the shit hits the fan the legislature will give the MTA what it wants with regard to work rules it could have won in negotiations.
We’ll see how that goes, if and when the Senate flips back to the Republicans can they kill the payroll tax and maintain Commuter Rail service in the face of severe TA cuts? If they do, can they keep their majority?
Did Walder just say “maximize productivity and eliminate waste” in an American newspaper article about an American government agency? Is the man insane?
No, he believes in government. That’s not as crazy as you may believe. Well run government can be an unbelievably powerful and important source of good in the world.
I’m well aware, AK. I’m not a libertarian – far from it. I just think American governments are structurally poorly-run. Walder’s actually trying to change it – if you read some of the ideas in the Making Every Dollar Count report, they’re basic efficiency improvements.
This is not a small deal. A subway line the length and complexity of Second Avenue Subway from 125th to Hanover Square would cost $3.5 billion in Paris, which has average construction costs for Europe, and $1 billion in Madrid, which is the world leader in cost control. Instead, the people in charge of the city and the MTA budgeted $17 billion for the entire project, and have already gone over budget in phase 1.
Having MTA workers actually act as if they care about the health of the MTA seems like a good idea to me. The GM union workers bargained themselves over 2 geneations into becoming employees of a bankrupt company. Why the NY Post hate? I thought it was our diversity of ideas that is our strength!
I care about the health of the MTA. I think separating NYCTA and TBTA from the MTA and raising the base fare to $3 would be health inducing. I also think transit workers should make a secure lower middle class living.
Current MTA worker salaaries/benefits do not amount to a “lower middle class” living by any metric. Indeed, the total package is firmly in the “upper middle class” category. You may think they deserve that, but let’s not confuse facts.
http://en.wikipedia.org/wiki/Upper_middle_class
I think it may help, but not too much. If the managers of the split agencies are drawn from the same strain as the current crop, then nothing will change. The MTA’s biggest problem right now isn’t that it’s too big or too suburban; it’s that it’s ignorant of cost-cutting solutions from other developed countries.
I guess you are referring to France then Alon, one of the premier systems in the world, on strike as we go to press, even though all flights in Europe are grounded. Lifetime medical for all French, if we had a “cost-cutting” solution like that for all citizens in the US perhaps you could live with the right to strike for transit workers.
Um, France has the worst union-business relations in Europe. Even Italy may not be as bad. It also has universal health care, but so what? US manufacturing and public sector unions have done jack shit to support universal health care ever since they got health benefits back in the 1940s.
But the issue here is not wages and benefits. It’s the number of employees. Parisian subway trains run with one operator, and commuter trains run with two. That’s actually higher than in most other developed countries, where commuter trains run OPTO just like subways. Construction is done by much smaller crews than in New York, and contractors don’t profiteer as much; it’s managed by railway professionals, instead of $500/hour consultants.
Jay Walder has been away from home too long. When he last worked in New York, Pataki & DiAmato ran the state, and Tom DeLay ran the country. Relentless ongoing demographic changes have brought a changing of the guard in both Albany and Washington.
Walder’s most promising, and perhaps only effective, option would be to index the fare to the basket of union contracts, which over time might just result in union contracts being indexed to the fare. A workable equilibrium for a functioning transit system.