“No contract, no work” used to be the motto of the Transport Workers Union.
The subway and bus shop’s new motto should be: “Good things come to those who wait.” After 27 months of working with no deal, the 34,000 TWU members who work for the state-run MTA just got a great deal from Gov. Cuomo: five years’ worth of raises, plus a bunch of new goodies.
But Cuomo’s election-year triumph will end up being very expensive for subway and bus riders — and for city taxpayers, too.
TWU chief John Samuelson plays up his everyman schtick. But with his deal-making prowess, he should really be working for Goldman Sachs. Yesterday, Samuelson could crow to his members that they can expect 8.25 percent raises over the five years between 2012 and 2016. That’s likely to run only slightly behind inflation. The average transit worker can expect to earn above $75,000 with this $6,000 or so raise — and will only have to pay $400 more in annual health-care costs in return.
And transit workers have also won a bunch of new goodies. They’ll now have two weeks’ paid maternity and paternity leave, plus better dental and eye care, as Samuelson said yesterday. That is all an especially impressive feat, considering that the TWU also got a good deal the last time around, at the depths of the financial crisis.
And unlike the rest of the civilian state and city workforces, the transit union was exempt from the biggest part of Cuomo’s pension reform three years ago — that is, a higher retirement age. Transit workers can still retire at 55 after 25 years.
How’d the TWU do this? The union members who work for the city have worked without contracts for half a decade in some cases. And the state workforce took wage freezes and other concessions during Cuomo’s first two years in office.
Simple: Samuelson played right into Cuomo’s desire for a great show.
On Wednesday, the union chief sent Cuomo a public letter, begging the governor to “personally intervene to bring an end to the protracted contract dispute…Absent your intervention, I do not see a path to resolving a number of difficult issues.”
Sure enough, along came Cuomo to the rescue, smiling Thursday as if he’d just concluded Middle East peace as he sat between Samuelson and MTA chief Tom Prendergast. He had each man sign a one-page agreement, then used his time to wax philosophically about how important it is to be fair and respectful. There was no question from everyone’s body language and words — everyone used the word “fair” because Cuomo likes that word — about who was the alpha male at the table.
But though the governor was putting on a show, it was a show only for a particular audience. Cuomo knows it’s a semi-holiday week. Today’s an important holiday for both Catholics and Jews, and it’s also school-vacation week, so lots of folk won’t be paying attention to the news — but TWU members certainly know what they’ve got.
But what about subway and bus riders?
Cuomo promised yesterday that “there will be no fare increases due to this contract negotiation.” No, there’ll be no fare increases now. But that’s partly because the MTA already plans 4 percent fare hikes next year and in 2017, anyway. And even with those fare hikes, the agency faces a $255 million deficit in 2½ years’ time.
Since it can’t print money, that gives the MTA only a few options: bigger fare hikes in the future, service cutbacks or begging for a state bailout.
The biggest risk, though, is that the MTA will slash its investments in upgrading and replacing subway cars, signals and track. The authority relies on borrowed money to make such investments, and borrowing has already doubled over the past decade. The agency can barely afford the debt it has — and spending another $200 million a year on its workforce, as this deal requires, means it gives up the ability to borrow $3 billion or so for long-term investments.
Cuomo’s action could also hit city residents’ wallets — or public services. Mayor de Blasio has yet to reach agreements with his quarter-of-a-million-strong workforce.
Of course, the governor can claim he was careful not to set a precedent here, keeping raises for the first two years’ of the contract to 1 percent annually. Still, though, the TWU is trumpeting the deal as “fully retroactive.”
The big picture is that de Blasio now has political cover (if not the actual money) to do a similar deal. After all, Cuomo styles himself as a fiscal conservative.
Cuomo’s not worried, though — he can spin the deal as “responsible.” But though enough people may fall under his spell, the numbers, eventually, will fight back.
Nicole Gelinas is a contributing editor at the Manhattan Institute’s City Journal.