“The reality is, we have to live within our means.” Which fiscally conservative luminary would you guess made that statement this week? The answer is Gavin Newsom. Yes, the very same Gavin Newsom who currently serves as the Democratic mayor of the liberal bastion known as San Francisco.
In a fiscally savvy move, the mayor did what he felt was necessary to combat a severe budget shortfall, and his swift answer did not involve taxing or further borrowing. San Francisco, as the mayor stated in a YouTube address on March 6, is facing a serious budget deficit. The city currently is short $522.2 million. Though the city’s budget itself is over $6 billion, Newsom was quick to point out that only a little over $1 billion of that is designated for “discretionary” use, and the mayor did not see the problem getting any better before it got worse.
As a result, during the work week culminating on Friday, March 5, about 15,000 city government employees received notifications that their full-time jobs no longer existed, and they may or may not be offered part-time jobs in the coming days. This rather shocking move was part of Mayor Gavin Newsom’s plan to address the city’s massive budget shortfall. Newsom called the scheme a “framework to address our significant budget shortfall,” adding that he had little choice, as the city simply could not wait for November elections and “we can’t borrow in order to spend money”. “There’s no doubt that this has been a difficult week for a lot of people,” the technology-loving mayor stated in a March 6 YouTube address.
The mayor’s plan is as follows: in order to resolve the funding shortage, 15,000 employees who worked 40-hour weeks were fired. Next, Newsom hopes that “the overwhelming majority” of the previous employees can be re-hired, but work 2.5 fewer hours per week, so as to be defined as part-time workers (and take a pay cut of about 6.25 percent). It is believed that this scheme could save up to $50 million. Yes, the mayor not only did not raise taxes or increase borrowing, but he also made it clear that the city hopes to provide jobs for as many of its (former) employees as possible.
The mayor also noted that employees in his office who earned over $100,000 were asked to give back 10 percent of their earnings, while those who earned more than $150,000 were asked to give back 15 percent of those earnings. (In this case, a suggested, charitable donation would have sounded nicer, but when it comes down to it, asking for some back pay, from those who support the administration, is nothing to holler at.)
San Francisco-style high spending played no small role in the accumulation of the $522.2 million shortfall, so perhaps it is poetic justice that a fiscally conservative plan (or “enlightened alternative", as Newsom phrased it) is being used to dig it out of the very same hole.