Bloomberg warns labor costs could increase under his successor
NEW YORK — Warning of the fiscal danger if New York City fails to rein in its spiraling pension and health care costs, Mayor Michael R. Bloomberg on Tuesday challenged his would-be successors to take a tough line in negotiations with the city’s unions, while worrying aloud that whoever is elected will be too beholden to labor.
“We can’t wake up tomorrow morning - the day after the election - and find that some candidate has made a back-room deal with one of the unions that sets the pattern for all the other unions that will eventually lead to stopping the growth in this city,” Bloomberg said, departing from his prepared remarks at the end of a speech in Brooklyn on the city’s economy and fiscal situation.
Bloomberg’s speech, delivered at a former Pfizer manufacturing plant that is now home to some two dozen small companies, producing everything from 3-D printers to kimchi, was in part an attempt to burnish his record of fiscal stewardship, which is hotly debated. He argued that he has determinedly tried to reform pensions and health care but has been stymied by unions.
Fiscal watchdogs note that his administration presided over a 40 percent increase in the city budget, and in his second term handed out raises without demanding concessions on pensions and health care. And some of the mayoral candidates have accused him of irresponsibility in allowing all of the municipal labor contracts to expire.
Bloomberg said the unions had “decided to wait us out and seek a better deal with my successor.”
Over the course of Bloomberg’s three terms in office, the city’s annual pension costs have increased from $1.4 billion to more than $8 billion as a result of raises, pension sweeteners and a growing number of retirees, while health care spending has swelled to $6.3 billion. The city also has $85 billion in unfunded liabilities for future retiree health care benefits.
A major question facing the next mayor will be whether to grant retroactive raises, which the unions are seeking, but for which the city has not budgeted. Bloomberg said on Tuesday that the city “can’t afford retroactive raises.”
Bill de Blasio, a Democrat, criticized Bloomberg for failing to address income inequality in the city, but praised his efforts at economic diversification, and said, “We also must negotiate responsible contracts with our city’s hard-working public employees”
Joseph J. Lhota, a Republican, offered unqualified praise for Bloomberg’s speech, and said, “I am the only candidate who has repeatedly said the city cannot afford retroactive raises for public employee unions.”