The Streets Were Paved with Gold - Ken Auletta [186]
And the price got higher. By May, the same candidate who denounced Mayor Beame for “pulling a rabbit out of his hat” when Beame discovered $1 billion in 1976 to pay off moratorium noteholders, suddenly fleeced $757 million from the city’s budget to pay for a two-year settlement. Under pressure to complete a contract before the start of Senate hearings on the city’s loan legislation, a subdued Mayor Koch, on June 5, announced his unconditional surrender. The contract, he said, called for an 8 percent pay rate raise over two years, but because the city postponed the dates these raises would begin, over the two years workers would actually receive 6.7 percent in real money. At the start of their next contract period, however, their pay rate will be up 8 percent. In addition, workers won a continuation of their COLA I payments, being raised to an average of $441 per year (from $395). In place of COLA II, the city agreed to drop the productivity requirement and grant each worker an annual “bonus” of $750—$78 more than they received in fiscal 1978 and $550 more than they received in 1977.
Appearing before Senator Proxmire’s Banking Committee on June 6, Koch held aloft a copy of the Times front-page story by Jerry Flint. The settlement was, he quoted approvingly, “an enormous achievement”—only 6 percent. (He later amended this to 6.7 percent.) Koch was assuming, as did Flint and others, that since the cost-of-living adjustments were continuations of previously won benefits, they should not be counted as part of the pay hike. Supposedly, they did not represent new money. But they did. The $1,500 in productivity “bonuses” workers would receive over the next two years was $628 more than they received in 1977 and 1978, when they were required to demonstrate productivity improvements.
As is often the case in these matters, it pays to wait until the dust clears and the press’s attention shifts elsewhere, then study the contract as viewed by the workers. The city traditionally understates the cost of contracts. D.C. 37’s point of view was presented in a circular to their membership—“Terms of the Wage Pact.” They claimed the pact called for a 15.84 percent “pay rate” raise. In an accompanying chart, the union explained that they arrived at this total by adding a 4 percent pay raise the first year, 4.34 percent the second, and the annual $750 bonus (7.5%). A worker earning $10,000 in June 1978, they said, would receive an even higher percentage in “actual cash”—an additional $2,525 over the two years. According to Teamsters leader Barry Feinstein, “There is a minimum salary increase of $2,663 in this contract for you.” According to The Chief, the newspaper that is the bible of civil service workers, “For an employee with three or more years of service the additional cash or so called “grocery money” over the two year period adds up to $3,279.50.”
This is only part of the cost. The Koch administration also agreed to abandon all its sixty-one “give-back” demands—including uniform allowances for those who don’t wear uniforms, the proposed forty-hour work week, the elimination of excessive sick days, heat days off and restrictive work rules. “The real question is whether in the context of reality … could I get, without a strike, the give-backs?” Koch told Proxmire’s Committee. What about “give-backs”? “I don’t think there is anything else that could be given back,