Pension-reform opponents watch election returns in San Jose, Calif. on June 5, 2012.
Bad news for teachers and other public-sector employees: America is more than ready to cut your pensions and benefits. While most politicos had been focusing this week on the Wisconsin recall, an election 2,100 miles away in San Jose, Calif., may be a bigger harbinger of the kind of austerity voters are developing a taste for.
In this city of about a million residents an hour south of San Francisco, voters on Tuesday approved arguably the country’s boldest pension cuts. San Jose’s Democratic mayor, Chuck Reed, has been grappling with ballooning pension costs that have increased from $73 million to $245 million in the last decade. Retirement costs already consume more than 20% of the city’s general fund, which helps explain why Reed was pushing San Jose to pass Measure B, which would give voters the power to approve increases in pension benefits and give the city the power to suspend automatic 3% annual raises during a fiscal crisis. The measure would also make workers contribute half the cost of their pensions; employees currently pay $3 for every $8 the city contributes, and the city is financially responsible for any shortfalls. Also included are provisions to curb the abuse of disability benefits. It’s a tough package — and will certainly be challenged in court because it changes benefits not only for future workers, something everyone agrees is legal, but for current ones as well. Nonetheless, voters passed it by a stunning margin of 69.5% in favor, 30.4% opposed. A pension reform measure also passed in San Diego.
(MORE: Why Scott Walker Survived His Recall)
These results matter for teachers, whose pensions and benefits are facing scrutiny and who should realize from Tuesday’s results that their unions are not invincible. Collectively the votes in Wisconsin, where Walker survived a recall after cutting benefits and curtailing collective bargaining for public sector workers, and in these California cities are a big wake-up call. These cuts are being made not in red states but in some of the country’s most progressive territory. If public-employee unions can’t hold the line in Wisconsin and California, they face even more daunting prospects elsewhere.
But voters need to understand the choices here as well. Unless cuts in public-sector benefits are coupled with improvements in working conditions and job satisfaction, there is a real risk that schools will not be able to attract the kind of people we want in classrooms. Good teachers don’t go into the profession for the money, but generous retirement benefits are hardly a disincentive either. And if we cut those benefits while continuing to treat teachers like DMV clerks — with lockstep pay schedules, little trust and few opportunities to take leadership roles or be entrepreneurial — it will become even harder to attract talented workers.
(MORE: How Should We Pay Teachers?)
So the riddle for educators is straightforward in theory and challenging in practice, i.e., how to make schools exciting enough places to work that people want to be there, even with benefits more on par with the non-governmental sector. There are some emerging ideas, including teacher-run cooperative schools in Minnesota, initiatives to give teachers more leadership roles that don’t mean leaving the classroom entirely, and high-performing urban charter schools where applicants for teaching jobs dramatically outpace openings. But make no mistake — addressing working conditions is the flip side of the benefits coin. If we fail to pair public-sector fiscal reforms with efforts to make teaching a more attractive profession, then in the long run what happened on Tuesday will end up being a lose-lose proposition. And not just for public-sector employees, but for us all.