By Richard Platkin

The Los Angeles Times (March 1 and March 14, 2010), Southern California’s rapidly shrinking, former newspaper of record, repeatedly complains that Los Angeles’s elected officials, primarily Mayor Antonio Villaraigosa and the fifteen members of the Los Angeles City Council, do not have a plan to guide them in their massive, highly selective cutbacks in municipal services, layoffs of public employees and increases in resident fees for city services.

It is too bad that the editorial staff of the LA Times has not bothered to read its own newspaper. If they had, they would know that LA’s elected officials have two plans before them, and they are carefully following one of them. They would also know that similar plans are being implemented at the Los Angeles Unified School District (LAUSD), not far down the street from City Hall. Its budget is as large as the city’s, but its budget deficit is even larger ($600 million vs. $450 million), as is its layoff list (6,000 vs. 4,000 public employees). Likewise, like the State of California, LA’s regional transit agency, the Metropolitan Transit Authority (MTA), the Los Angeles Community College District and the MetroLink regional rail service are also facing massive budget deficits and responding to them with the same formula of cutbacks, layoffs and extra fees. The only difference between their plight and the city’s is the extraordinary amount of pushback by students and teachers against budget cutbacks and fee increases. On March 4, 2010, rallies and marches that drew participants from across the state and from all levels of public education—K-12, community colleges and universities—were held.

The Los Angeles General Plan

One plan available to LA’s elected officials, the Los Angeles General Plan, and especially its Framework Element, is required by state law and cost the city millions of dollars to prepare in the early 1990s. The General Plan Framework Element was based on rigorous research, honed through several hundred public meetings and carefully reviewed, debated and legally adopted by the City Council and mayor in 1995. Despite the current ignorance of LA’s largest newspaper, this plan forecast the city’s growth and the infrastructure, housing and employment needs of a growing population and clearly identified the city’s policies and priorities for the next two decades (1990 – 2010). But, shortly after the plan’s formal adoption, the same elected officials, along with the Department of City Planning, dropped the plan like a hot potato.

The General Plan Framework Element became a shelf document, presumably for two reasons. First, in the era after LA’s 1992 urban rebellion, the largest civil disturbance in the United States since the Civil War, policing became City Hall’s only infrastructure priority. Since then every city politician, especially Mayor Villaraigosa, has been fixated on hiring more cops. Second, the General Plan Framework Element highlighted the city’s broad infrastructure requirements and called for a rigorous monitoring system which could be used for reviewing real estate projects. In a city with the country’s worst traffic, air and streets, the Framework’s focus on infrastructure monitoring and infrastructure construction would have put a straightjacket on real estate speculation.

City Hall’s decision to jettison the framework shortly after it was adopted was no different than parallel decisions in Washington during the 1990s to roll back financial regulations and enforcement in order to green-light riskier investments. This is why the framework has been totally ignored ever since by the city’s elected officials, department managers and local press. The framework’s horizon year is 2010, meaning its empirical basis is about to expire and there are no known plans to update, rescind or replace it.

The Neoliberal “Race to the Bottom” Plan

Nevertheless, as LA’s city officials muddle through the “Great Recession,” they still have another plan to guide their cleavers in carving away vital municipal services and firing thousands of public employees. It is their neoliberal “Race to the Bottom” plan. The difference is that the Race to the Bottom Plan was never required by state law, openly researched, put in writing, debated, legally adopted or shared with the public. Nevertheless, the LA Times reports about this plan every day, including admonishing editorials and intricate details about the two teams competing with each other over the best way to reach bottom.

So what is the Race to the Bottom plan, who are the two teams competing to implement it and what are their differences? In one corner is Mayor Antonio Villaraigosa, the California chair of Hillary Clinton’s presidential campaign, then Barack Obama’s. He is backed by a majority of the largely Democratic City Council and guided by the city’s administrative officer, hatchet man Miguel Santana, as well as an in-house Wall Street banker, Austin Beutner. The latter’s illustrious pedigree includes high finance jobs at Smith Barney and the Blackstone Group, and a job at the U.S. State Department working to ensure the rebirth of market capitalism in Russia. The mayor also has a cheering section from Wall Street’s three major bond rating companies. Their job, like the LA Times, is to stampede the City Council whenever it takes a breather in slicing and dicing city government’s non-police functions.

In the other corner are several members of the Los Angeles City Council. They are backed by most of the city’s employee unions and some neighborhood associations. So far this team’s greatest achievement has been to cut city programs from the top through the ERIP, a golden handshake program to retire 2,400 older employees. Otherwise, they call for shifting cuts to other city departments, contracting out slightly less municipal services and better scrutinizing the sell-off of city assets.

So, what is the mysterious Race to the Bottom plan on which these two teams agree? So far it has at least seventeen components, and counting.

1. Scrupulously make sure that there is absolutely no connection between the city’s feeble planning process and its even more feeble budgeting process.
2. Reduce the non-police role of city government by eliminating several civilian departments, shrinking many municipal programs and getting rid of thousands of career city employees in these “superfluous” offices. They are throwing overboard those civil servants who deal with cultural events, urban forestry, libraries, parks, environmental affairs, social services, code violations and neighborhood councils. So far the two teams reluctantly agreed to the early retirement program and are now preparing to fire 4,000 city employees, with the Los Angeles Police Department, of course, exempted from layoffs. While Los Angeles has had many smaller budget crises in recent decades, all associated with civilian hiring and pay freezes, this time the elected officials have really rolled up their sleeves. In the midst of a deep recession, these economic wizards want to slash public payrolls to make sure that the city’s job losses keep up with those in the private sector.
3. Cut the hours and pay of remaining non-police employees by 10 percent through furloughs.
4. Reduce the power of public employee unions to organize labor actions, negotiate contracts, protect their members and set an example for private-sector workers in terms of salaries, benefits, job security and protection and retirement.
5. Increase the payroll deductions for remaining civilian employees.
6.  Except for parking violations, minimize enforcement of the city’s many laws, especially building and zoning codes.
7. Accelerate the processing of applications for building permits and related city planning land use “entitlements.” To expedite these permits, the mayor deployed the head of his Business Team, Bud Ovrom, to become the new general manager of the city’s Department of Building Safety.
8.  Increase city revenues through jacked-up regressive fees on municipal services, such as electricity, water and garbage collection, as well as through enormous increases in the cost of parking meters and fines for traffic violations.
9. Offer truly enormous grants, cheap loans, fee waivers and subsidized public infrastructure to large real estate projects primarily paid for by the city’s general fund, with smaller amounts from the city’s Community Redevelopment Agency.
10. Avoid any analysis of the causes of the city’s repeated budget crises in the past or at present, other than the current recession. Two decades of deferred infrastructure investments, as well as numerous hiring and promotion freezes, along with several rounds of smaller layoffs have, in effect, been ruled out-of-order.
11. Never call for any progressive taxes and never mention proposed reforms of Proposition 13, which, since its adoption in 1979, has cost state and local government dearly. Serious analysts know Proposition 13 has become a major tax dodge for commercial property. Nevertheless, it will continue to be a major backdoor subsidy for those who invest in commercial real estate in Los Angeles and the rest of California.
12. Maintain absolute silence on the long-term reductions in federal programs for cities since the Nixon administration, as well as in two expensive current federal programs for which the sky is the funding limit: the bailout of the banksters and the endless wars in Iraq, Afghanistan, Pakistan and probably Iran. When it comes to these extraordinarily expensive and illegal energy wars, both of City Hall’s cutback teams have taken an oath of silence.
13. Lease or sell off moneymaking city assets, such as parking structures and parking meters.
14. Privatize more city services, such as computing, which will go to Google.
15. Defer investment in the city’s infrastructure, even though Los Angeles sits on major earthquake faults and is subject to life-threatening floods and wildfires. The “Big One,” a massive earthquake larger than 1992’s Northridge earthquake, could happen at any moment, according to the U.S. Geological Service and FEMA, and yet City Hall has systematically avoided adequate infrastructure planning and investment since that late 1960s.
16. Erode public employee pensions by increasing deductions for remaining employees and discuss changes in retirement formulas, such as age requirements.
17. Join the corporate media by floating proposals to cut back civil service protection for city employees, especially when it comes to seniority and bumping rights during layoffs.

Viewed in the aggregate, the mayor and the City Council clearly have a plan, and its essence is to use the cover of a deep recession to institute many existing proposals, usually labeled “neoliberalism.” In the view of the think tanks and politicians, its intent is to make government more “business-friendly.” In more straight talk, it is “crony capitalism” or the use of taxpayer money to increase the short-term profits of private investors with political connections.

Although most of the pols don’t see it, there is a deeper method to their madness. They delude themselves with claims about imminent prosperity and that they are just pursuing short-term budget fixes until the U.S. economy recovers from a deep recession. Few of them realize that the U.S. economy, like the global economy, is in the midst of a deep, long-term financial crisis. Most of their cuts and layoffs are here to stay and will get worse as more components of their Race to the Bottom Plan are unveiled and implemented.

If an economic recovery eventually returns, it is not going to be used to raise the salaries and benefits of public employees, fortify pension funds, build libraries, plant trees and educate students. This is because, sadly, the decision-makers prefer to sacrifice most local government functions to pay for other government priorities, in particular real estate subsidies, corporate bailouts, military hardware and foreign wars.

Their plans to fill these enormous local gaps with such gimmicks as additional charter schools, high stakes testing, contracting out and privatization are nothing more than an unintended strategy to reach bottom. While the pols might actually believe in these schemes, or that cities like Los Angeles can function without adequate city plans, schools, libraries, parks, urban forests, cultural events, building inspectors, plan checkers and neighborhood groups, they are really diverting local public resources to support federal priorities.

There are some clear lessons to be learned from this debacle:

1. The slashing and burning of most local public services is a long-term trend, not just a blip resulting from the Great Recession.
2. Its purpose is not just to dish out public favors to well-connected investors who need a short-term boost in their bottom line through contracts or bailouts, but to martial public resources for other projects and programs.
3. So far, the public employee unions do not have an effective program to reverse these trends. They have yet to organize work actions to stop cutbacks and layoffs or form strong alliances with the public, the other victim of cutbacks. For the most part, the primary political strategy of the employee unions is to fund the campaigns of the very same politicians who are imposing furloughs and layoffs on their members.
4. Any solutions to this long-term crisis will come from the bottom up, not the top down. There are no politicians on the horizon capable of rectifying this situation, or economists with a magic formula to fill local government coffers in order to provide high-quality employment and public services. So far, students and teachers have taken the lead in direct actions, and they have provided a model for other public employees and the general public to form effective political alliances.

Richard Platkin (rhplatkin(at)yahoo(dot)com) is a Los Angeles-based planning consultant and invites comments on this article.