City chokes on cuts

Well, you had a feeling this would happen. All of a sudden, the mayor and several council members are questioning whether the city really needs to let anybody go. I mean, they're only faced with a $200-million shortfall. From the LAT:

Standing outside his office, the mayor told reporters this afternoon that the city could address much of the financial crisis if public employee unions agreed to reduce their pay -- or let some city services be performed by cheaper, private contractors. Villaraigosa also said that the city could address its spiraling retirement costs if workers agreed to pay more toward their pensions - 9% of their salaries instead of the current 7%. "If they contributed a couple of percentage points more, that could put us in a much stronger financial position," he said. "If we work through this together, I think we can minimize layoffs."

Work through this together? Doing what? Cutting back on paperclips? Could you imagine a company being in the red by $200 million and the CEO holding off on layoffs? Cities are not companies - I understand that. But they are organizational entities that must be managed. Just last week, Villaraigosa instructed budget analyst Miguel Santana to figure out how the city could eliminate at least 1,000 city jobs - either through layoffs or by moving employees into vacant posts. They're now back to hoping it will just go away.


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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
 
Mark Lacter, business writer and editor was 59
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