The bankruptcy of Vallejo, California, attacks on public sector workers, and what it means for the working class.
By Joel Schor
Posted on February 18, 2011 by the the Solano County Central Committee.
In May of 2008 Vallejo began to make the news in the Bay Area and world by a unanimous vote of its city councillors in favor of filling for Chapter 9 bankruptcy in San Francisco Federal District Court. In the weeks and months to come Vallejo's city manager Joe Tanner would support the case for bankruptcy by blaming the public sector unions - police, fire department, and electrical workers for pushing the cities general fund into the red. While the federal judge had ruled in favor of allowing the city municipal bankruptcy protection in September 2008, the rapidly downward fall in real estate prices would also entail a fall in property tax revenues for the schools and county services - which are supplemental to the city such as with sherifs who assist local law enforcement. Further, the real estate crisis is leading to a population flight from Vallejo due to foreclosures, which in turn lowers the city's revenue base from local economic activity. The push for bankruptcy was entirely focused on the unions as the culprits of Vallejo's economic troubles, and Stephanie Gomez emerged as an anti-union political force on the city council. In the midst of the bankruptcy proceedings, the unions came to the city offering $10 million in wage and benefit cuts. The offer was refused, and the cities negotiator claimed that employee wages and benefits were completely responsible for the $16million deficit in the general fund. The judges ruling in favor of bankruptcy, granting the city protection against its creditors, would make evident that dissenting views and a participatory dialogue over the cities priorities would not be tolerated.