Morning Must Reads: Another Austerity Budget, Blue-Collar Layoffs in Philly & More Paperwork!

Vacations are great, but it is good to be back! While I was away, European leaders met to take what they hoped was decisive action to stem rising borrowing costs for Spain. 

And once again borrowing costs in Spain were on the rise Monday (paywall). With the Spanish economy once again shrinking, European leaders are giving the country more time to reduce its budget deficit but are still insisting on spending reductions in the face of a shrinking economy. 

Reducing public-sector spending as the private sector contracts leads to a deeper recession and a bigger budget deficit. 

Don't be too smug: we have our own problems here at home. As my colleague Sharon Ward explains, Pennsylvania has enacted another austerity-minded budget.

For several weeks now, I have started each day by pouring my morning coffee and reading a new story about a Pennsylvania school district laying off teachers, ending art and music programs or raising local taxes. Or a story about the nearly 68,000 people about to be cut off from a modest, temporary stipend that helps them to get back on the path to self-sufficiency.

Contrast this bad news with the picture of Gov. Tom Corbett and state lawmakers smiling as the budget was signed on June 30. When the ink has dried, there is little in this budget to smile about. It maintains the deep cuts to schools that have forced many into financial distress. It makes it harder for people who are sick or disabled to get by.

And it will continue to cost tens of thousands of jobs at a time when our economy is still fragile. Rather than building our economy, this budget continues to strangle it and compromise our children’s future. Lawmakers are smiling to keep up the fiction that they haven’t raised taxes. We know better: This budget shifts responsibility and costs onto you, the local taxpayer.

As the figure above illustrates, we have already absorbed unprecedented reductions in employment among teachers, first responders and other public servants. With the new budget, we will begin to see the implementation of the planned layoffs announced by school districts. The final tally of layoffs will not be clear until the employment data come in this fall. 

The Philadelphia Inquirer reports this morning that we have a little less than a week before the first round of layoffs for blue-collar support workers in the Philadelphia School District is scheduled to begin. 

With less than a week before hundreds of blue-collar workers could lose their jobs, Philadelphia School District officials said they have not made up their minds on whether the layoffs will go forward.

Each of the district's 2,700 mechanics, bus aides, cleaners and others — members of SEIU 32BJ Local 1201 — has received a pink slip amid a continuing budget crisis in the district. About 500 of the layoffs would take effect Sunday.

The district faces a deficit of as much as $282 million, and school officials have said they need big savings in both labor costs and transportation and maintenance.

Union officials have said they have put more than $20 million in concessions on the table. Negotiations are expected to resume Tuesday.

"We are continuing to negotiate with 32BJ Local 1201," district spokeswoman Evelyn Sample-Oates said in a statement Monday. "No decision has been made at this point.

The Philadelphia Inquirer also reports in detail this morning on an increase in paperwork for poor families seeking health care in Pennsylvania. The article provides an illustration of the selective approach to accountability being taken in Pennsylvania with regard to taxpayer funds.  

If you are poor in Pennsylvania and temporarily disabled, a health-care worker can fill out a one-page form that qualifies you to receive medical care paid for by the state.

But that is changing under a new policy, requiring more paperwork, that Gov. Corbett is implementing, arguing that it will save taxpayers money without denying significant numbers of people medical care.

Health-care workers and advocates for the poor, however, say the new policy could leave thousands of people without needed care and drive up medical costs in the long run.

"They are using this as a way to deny people health insurance," said Gene Bishop, a doctor who directs a clinic at Pennsylvania Hospital. "These are sick people with chronic conditions, and they are going to get sicker."

And once again quoting Sharon Ward, we get precisely zero accountability on the expenditures of hundreds of millions in taxpayer funds in the Educational Improvement Tax Credit program.  

The General Assembly has pulled a curtain around the Educational Improvement Tax Credit and Scholarship programs, allocating $150 million while prohibiting state agencies from collecting all but the most basic data.

My colleague Stephen Herzenberg gives you the in-depth review of the Educational Improvement Tax Credit program.

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