Bad faith

Newsom and his business allies work to kill proposed revenue measures by any means necessary

Board of Supervisors President David Chiu speaks at a July 6 rally for labor unions seeking an increase in the hotel tax

Mayor Gavin Newsom and his business allies are actively trying to sabotage the various revenue measures that have been put forth by the labor movement and progressive members of the Board of Supervisors, employing deceptive rhetoric, sneaky tactics, and a refusal to bargain in good faith.

In fact, Newsom — the Democratic nominee for lieutenant governor — is so averse to supporting anything that could be called a "tax" that he rejected a hard-won compromise measure created by powerful developers, affordable housing advocates, a pro-business think tank, the building trades, and his own directors of housing and economic development.

Just as that story was breaking in the New York Times (produced by Bay Citizen) on July 9, members of the Board of Supervisors Budget and Finance Committee discovered that Newsom's proposed ballot measure to close loopholes in the city's hotel tax that favored airline employees and online travel companies — a widely supported change, but one worth just $6 million per year — contains language that would nullify any increases in the hotel tax. Earlier in the week, labor unions turned in signatures on an initiative to increase the hotel tax by 2 percent, which would bring in more than $30 million per year.

"This poison pill is an intentionally deceptive, underhanded move," Gabriel Haaland, an organizer with Service Employees International Union Local 1021, which sponsored the hotel tax, told us. "It's so frustrating. It's not even a good faith fight. He's trying to create confusion and fool the voters. If our measure passes fair and square, it should be implemented."

Meanwhile, Newsom and business groups have been attacking a reform measure by Board President David Chiu that would make the currently flat payroll tax more progressive, exempt more small businesses from paying it, and create a commercial rent tax to spread the tax burden more widely than the 10 percent of businesses who now pay tax to the city.

Critics complained that the measure would hurt local businesses — but that's just not true. The city's Office of Economic Analysis concluded that Chiu's original proposal would have no effect on private sector jobs and would generate $34 million annually for the city, preserving some government jobs and spending.

Then Chiu amended the measure to spare even more small businesses. Now the OEA says that the measure would actually create private sector jobs — and still bring $28 million in to the city. Yet Newsom and the business community are still withholding their support.

This trio of Machiavellian moves comes just a week after Newsom pulled out of budget negotiations with board progressives concerning about $40 million in board add-backs to programs that Newsom proposed to cut after they wouldn't agree to his precondition that they withdraw unrelated measures proposed for the November ballot, such as splitting appointments to the Rent, Recreation and Park, and Municipal Transportation Agency boards and requiring police officers to do foot patrols.

The series of events has led many progressives to say that conservative ideological blinders — a knee-jerk opposition to anything that saves government jobs and services or that Republicans might criticize — is the only logical explanation for the intransigent stance adopted downtown and by Newsom.

"It's ideological. It's not economic, and it's not even political," said Calvin Welch, the affordable housing activist who helped negotiate the transfer tax compromise with developer Oz Erickson, San Francisco Planning Urban Research Association director Gabriel Metcalf, Mayor's Office of Housing Director Doug Shoemaker, and others.


Calvin Welch gets rolled again and it is not he who suffers, he still gets paid.

What kind of record of failure would he need to pile up in order for the community to revoke whatever confidence it has in Welch and ask him to move on?

"Poorly needed construction jobs" in San Francisco are our own equivalent to "poorly needed deep water drilling jobs" in the Gulf. Ill advised reliance on both have led to economic catastrophe, because both are unsustainable and bring unacceptable risks.

The risks in the gulf are apparent, but the risks of housing fetishization locally are the front end of the real estate speculative bubble that crashed the economy. San Francisco is too small, even in the most optimistic upzoning scenarios, to support construction sustainable, just as the Gulf of Mexico is too deep to support drilling sustainably.


Posted by marcos on Jul. 15, 2010 @ 10:43 am

Welch had no credibility in any event but what is much more interesting here is how the city deals with the impending fiscal crisis. You have only to look at the dire mess Oakland is in, laying off cops, to see our future writ large.

You can cut and cut but eventually fire and cops consume 75% of your budget, as in Oakland.

You can pass parcel taxes, if the voters let you, and nickle and dime folks on fees, but eventually the people will rebel.

Such issues take the highest quality of leaders and sadly we don't have them. The NIMBY activists like Welch, Shaw and Hestor are already discredited. The BofS fiddles while Rome burns. And the mayor, while competant, has his eyes elsewhere.

Who will save us? Nobody we can see right now. And it doesnt help that those senior entities that might otherwise bail us out, e.g. the State and the Feds, have their own horrific debt issues.

Home prices? Ha!

Posted by Folly on Jul. 15, 2010 @ 11:27 am

Newsom lead us to where we are right now. He negotiates the contracts and dictates the budget and the Board gets to chip away at the edges. Newsom is not competent.

That said, neither progressives nor conservatives are doing a very good job of articulating a vision for reconciling municipal government with the 21st century economy. Our institutions of government, tax structure, schools bureaucracy and labor unions are vintage 1930s political infrastructure which might have worked once but no longer function under different circumstances.

The contest should be over what values and priorities drive that transformation. A good first step would be to marginalize those who led us into this mess. But if practice holds, they will be rewarded with promotions. If we can't help but kick the demonstrably incompetent upstairs, then we don't deserve better than we get.

Those interests which have outsourced or not been politically capable of stopping the outsourcing of good jobs are not competent. We need to be setting the economic standard for solutions based on the early 21st century economy to diverse, sustainable job generation, access to affordable health care, for delinking speculation and land use, and guaranteeing retirement security and dignity.


Posted by marcos on Jul. 15, 2010 @ 2:37 pm

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