We Must Not Forget Oregon Democrats’ Betrayal on PERS

We Must Not Forget Oregon Democrats’ Betrayal on PERS

Oregon AFL-CIO
Oregon AFL-CIO

The best thing about being president of the Oregon AFL-CIO—with less than 100 days until the end of my term—is that I can now say whatever I want, whenever I want. For example, in the past, I felt limited in the ways I held legislative Democrats accountable. There is a tendency to soften one’s criticism, understanding that there is always a next session and another legislative agenda. Holding legislative leadership accountable with statements that are too harsh could impact future legislative agendas. I am sorry to say: There are too few Republicans that we can count on to help move our agenda, making the Democrats the only game in town for labor issues.

I don’t believe in exclusive support of political parties. Organized labor should support those who support workers, and hold those accountable who side with a corporate capitalist agenda at the expense of workers. But there was a wrong and a betrayal done to Oregon workers in 2019 that is so heinous it would be wrong to look the other way for the sake of future agendas.

The corporate capitalist agenda was on full display during the 2019 Oregon legislature as business beat the drum about PERS attacks and used the Student Success Act as leverage. The Student Success Act promises to increase much needed funding to Oregon schools by $1 billion per year. Oregon corporations will pay for the increase through a gross receipts tax. In 2016, Oregon corporations paid the lowest corporate taxes in the nation.

I commend the Oregon legislature for increasing K-12 funding. It is high time that Oregon corporations begin paying their fair share for Oregon services, and I hope this is the first step in achieving that goal.

Since 2008, Oregon corporations have pounded the drum on their perception that PERS provides overly generous retirement benefits and funding. PERS is currently funded at 80%. Translation: If every active PERS member were to retire today, Oregon would be $27 billion short. This shortfall is a result of the 2008 stock market crash and has little to do with tier three members who make up just over 60% of current active public employees. These employees receive a much smaller benefit than previous retirees. The PERS tier three payroll cost is 8%. Such legacy costs shouldn’t be the responsibility of workers, but treated as an Oregon debt that needs to be paid.

Oregon corporations involved with the passage of the Student Success Act exacted a price for their support. Senate Bill 1049 will result in a loss of between 7% to 12.5% in workers’ individual retirement accounts, according to the PERS agency. SB1049 does little to nothing toward paying down the PERS unfunded liability. Tier three recipients already receive the lowest retirement benefits in PERS, and the only thing SB1040 ensures is that tier three will see even lower benefits in the future.

The bill passed both the House and Senate by one vote. Seven House Democrats and five Senate Democrats stood with Oregon workers and voted against SB1049. Pressure from their leadership and the governor’s office did not dissuade them from fulfilling their promises to Oregon workers.

The 31 House Democrats and the 13 Senate Democrats who voted for the legislation, along with the governor, broke their promises to Oregon workers. I have reams of candidate questionnaires from union-endorsed House and Senate candidates who promised not to cut PERS benefits. The governor promised as well. To go back on that promise undermines their credibility with the unions who endorsed them. Worse yet, such action undermines the very credibility of our political programs. Our members spent their hard-earned money and dedicated countless volunteer hours electing Democrats that they trusted to fulfill the commitments they made to them through the endorsement process. These candidates sought our endorsements!

The Oregon Senate and House leadership kept in question exactly when SB1049 would be up for a vote until the last minute. This blatant political manipulation of the legislative process intentionally prevented workers from witnessing the betrayal. Then, the legislative handwringing and excuses for the vote came like an avalanche. Excuses ranged from: “We stopped the Nesbitt PERS initiative, which would have been worse,” to one senator actually saying: “You really didn’t believe us, did you?”

For the record, the Nesbitt PERS initiative, which takes an axe to PERS benefits, is still active and on course to be on the 2020 ballot.

It should not be lost on anyone that while corporations were at the table having input into the Student Success Act, Oregon public sector unions were not invited to have input into the governor’s PERS proposal, or the House and Senate proposals. The PERS reforms of 2005 and 2013 both included the leadership of public sector unions. This begs the question: Why would the governor and legislative leadership totally silence the voice of workers in this process?

If it wasn’t for the PERS betrayal, many would view the 2019 Oregon legislative session as the most successful in a decade. The SB1049 betrayal becomes the focal point because unions and our members worked hard and spent their hard-earned dollars based on promises made during the campaign season. Members ask: How can we elect a governor, achieve super majorities in the House and Senate, and still public employee unions weren’t even invited to the the table in PERS reform? Oregon unions should not base their endorsements on promises made by House and Senate members who are fast to break those promises when it is convenient. Rather, we must support candidates based on their demonstrated performance.

There must be an analysis made for those union-endorsed candidates who faced the greatest odds in crowded primaries and are only in the legislature due to the hard work of our members. We must not forget.

This post originally appeared at NW Labor Press.

Kenneth Quinnell
Thu, 06/27/2019 – 14:11

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Updated: July 15, 2019 — 5:50 am