Tag Archive for Los Angeles Times

Another Tax Reform Group Backed by Unions: Don’t Be Fooled

Perhaps the description “venerable” would be appropriate for a group called the California Tax Reform Association, which has been involved for almost 40 years in various campaigns to increase income taxes on “the rich” and corporate entities. (See Coalition Seeks to Eliminate Tax Breaks for Rich, CorporationsLos Angeles Times – November 21, 1991.) In recent years, the California Tax Reform Association made a public appearance when its executive director signed a support argument for Proposition 24, an unsuccessful ballot measure in November 2010 to “close corporate loopholes.”

On January 29, 2014, the Los Angeles Times ran a column by George Skelton (Lack of Leadership a Big Obstacle in Updating Prop 13) about proposed changes to Proposition 13 that would result in higher tax assessments against commercial property owners. It cited the executive director of the California Tax Reform Association, but did not indicate the agenda or backers of this organization for readers.

George Skelton began writing for the Los Angeles Times in 1974 and the California Tax Reform Association was founded in 1976, so perhaps it was assumed that everyone knew about this group and its historical influence. One might feel a little melancholy to see how the California Tax Reform Association has not kept up with changing times: it hasn’t posted on its web site since May 2012 and it does not appear to use social media.

My article Taxpayer Group Pushing to Gut California’s Prop. 13 is Union Front Group, posted on February 4, 2013 in www.UnionWatch.org, reveals the funding sources and leadership of this organization. It’s a front for public employee unions.

Latest Scheme for Career Technical Education: School Districts Borrowing Money with “Social Impact Bonds” – Unions on Board

On March 19, 2013, California State Senate Pro Tem Darrell Steinberg led a press conference to promote Senate Bill 594 (California Career Pathways Investment, also known as the High School Dropout Reduction & Workforce Development Bond Act of 2013) meant to encourage partnerships among school districts, corporations, and unions for career technical education in California K-12 schools and community college districts.

Senator Steinberg also promoted this bill on March 22 at Redevelopment Forum: Revitalizing our Neighborhoods in a Post-Redevelopment Era, hosted by the San Diego Foundation. SB 894 is apparently a serious initiative.

It establishes an unfunded mandate for K-12 school districts and community college districts to create a new pool of money called a “Career Pathways Investment Trust Fund.” These districts can borrow money for the program by selling “Social Impact Bonds” (a concept promoted by the “progressive” Center for American Progress) for which investors can earn “Career Pathways Investment Credits.” This will be overseen by a new state government board called the “California Career Pathways Investment Committee.” The appointments of the Assembly Speaker and Senate Rules Committee to this committee will likely be union officials.

Senate Bill 594 exemplifies the foolishness of governance in the California State Legislature:

  • bizarre and incomprehensible financing schemes
  • borrowing money (with interest) without consideration of cumulative debt service
  • unfunded state mandates
  • forcing the state’s local governments to create and manage another pool of money
  • inviting more corruption at local governments
  • creating another state government board
  • tax breaks to corporations for ambiguous purposes
  • intrusion of corporations and unions into the public school system
  • brilliant suggestions that freed-up funds from a few cuts in the state budget can be transferred to pay for it
  • lack of concrete evidence that there is a problem (in fact, testimony during the press conference suggested the big problem is a lack of jobs, not lack of training)
  • government solutions for something that could be handled by the free market if there was real demand

When Governor Schwarzenegger promoted his Career Technical Education initiative in 2007, he considered it worthy enough to propose paying for it out of the general fund through the annual state budget. His efforts were not deemed worthy of mention at the SB 594 press conference.

Here’s my March 20, 2013 article in www.UnionWatch.org about the press conference and Senate Bill 594: Businesses Can Make a “Social Impact Bond” with Unions – www.UnionWatch.org – March 20, 2013.

The Sacramento Bee posted an article on March 21, 2013 about Senate Bill 594, Steinberg Pushes Privately Funded Career Training Program, which quotes me as a skeptic:

But skeptics wonder how the career readiness programs would be funded.

“They need to stop coming up with new funds and new schemes paid for by borrowed money,” said Kevin Dayton, head of the consulting firm called Labor Issues Solutions. “New things like this are just a big distraction. If they want to do career education they should fund it in the general budget.”

I posted these comments under the article:

Do you want your K-12 school district or community college district to establish a “Career Pathways Investment Trust Fund” and oversee yet another pool of money? It’s a mandate.

Let’s create another state government board: the “California Career Pathways Investment Committee!” The appointments of the Assembly Speaker and Senate Pro Tem will certainly be union officials.

Do you want your K-12 school district or community college district to sell “Social Impact Bonds?” Who will pay the interest on these bonds? Who will make the money on the interest?

“Career Pathways Investment Credits” – how about just focusing on an efficient, responsible government with a simple tax structure?

As another comment indicated, “the State has funding for apprentices (it contributes about 5% of the cost to train an apprentice – the rest coming from employers)…”

I also mentioned this in my comment:

One is led to believe Senate Bill 594 is needed because California businesses can’t find skilled workers. But notice the nurses’ association representative says the problem is that trained nurses can’t find jobs in California and therefore need to move out-of-state. And is there really a shortage of skilled construction workers in California right now? Are there no longer 20%-30% unemployment rates in the building trades? Or is SB 594 for training disadvantaged union workers to build the California High-Speed Rail under the Project Labor Agreement?

Los Angeles Times columnist George Skelton wrote positively about the general concept of encouraging career technical education (he avoids the politically correct phrase and simply calls it “shop”), but his column (Reinvigorating ‘Career Tech’ a Worthy Goal – Los Angeles Times – March 20, 2013) also reveals that the supporters don’t understanding the funding scheme:

Steinberg’s legislation is a bit convoluted — at least the financing part — and needs much work…Steinberg is suggesting several financing methods, including tax credits and foundation grants. But the main money source involves bonds. The state would sell “workforce development bonds” — say, for $1 million a crack — to businesses in areas “with the greatest potential for high-wage job growth.” The bond revenue would pay for the career-tech programs. The bond-buyers would earn a rate of return based on a program’s results, as judged by some committee. “I’m not sure I completely understand it,” Zaremberg [Allan Zaremberg, President & CEO of the California Chamber of Commerce] told me. “Why don’t we just fund this out of existing resources? Is this not a priority? … like Zaremberg, he [Jack Stewart, President of the California Manufacturers & Technology Association] doesn’t quite grasp the bond idea.

Dan Walters is another California commentator who has written much over many years about the need for stronger career technical education programs in California public schools. (For example, see Technical Education Fight RagesSacramento Bee – November 19, 2007)  I look forward to reading his perspectives on Senate Bill 594.

A Compilation of Construction Trade Union Project Labor Agreements for K-12 School and Community College Districts: Construction Manager-at-Risk, Lease-Leaseback, and Developer-Built Schools

The following set of Project Labor Agreements on California K-12 school district and community college district construction projects have unusual elements.

First, these Project Labor Agreements apply to public school and community college construction projects, but private parties negotiated them.

In the case of Hartnell Community College District, a construction manager-at-risk negotiated the Project Labor Agreement without authorization from the elected board of trustees. The board nullified the agreement after the company had applied the agreement to three small projects funded by Measure H.

In the case of Delano Union School District, the district arranged a lease-leaseback agreement with a private company, which proceeded to negotiate a Project Labor Agreement.

The remaining Project Labor Agreements were negotiated by private developers for school construction projects built privately by those developers. After the developers completed these projects, they transferred ownership to educational districts. Starting in the late 1990s, developers of proposed large residential housing projects in California began making agreements with K-12 school and community college districts to build their own schools and then transfer ownership to the districts. (See Builders Pick Up Tab for Schools – Los Angeles Times – July 7, 2002.)

Government agencies did NOT mandate that contractors sign these agreements, except in cases when a private Project Labor Agreement contained a successor clause that continued to apply the agreement to follow-up construction contracts, even after the ownership of the building transferred to the educational district.

In some cases, local governments provided some public funding for specific components of these developer-built projects. As a result, some taxpayer money was spent on contracts for which construction companies had to sign a Project Labor Agreement. For example, in 2002 the Roseville City School District made an agreement for Westpark Associates to fund five new schools in the West Roseville Specific Plan. Two have been completed: Junction Elementary School and Chilton Elementary School. Chilton Elementary School cost $50.6 million: the developer paid $33.7 million, the state provided $16.9 million, and the City of Roseville paid for construction of a gymnasium that the city uses for adult recreational activies outside of school hours.

Unlike government-mandated Project Labor Agreements, some of these private agreements only cover a few unions (typically, unions that engage in “greenmail” by submitting or threatening to submit legal objections under the California Environmental Quality Act – CEQA – concerning the proposed residential developments).

Project Labor Agreements negotiated by private developers are not a matter of public record, and the list below is surely not complete.

Monterey County – Construction Manager-at-Risk Project Labor Agreement

Hartnell Community College District Project Labor Agreement – Measure H – 2004 – Negotiated by DPR Construction and Employers’ Advocate – Nullified After Three Small Projects

Kern County – Lease-Leaseback Project Labor Agreement

Westside Educational Complex for Delano Union School District Project Labor Agreement 2011 between Grapevine Advisors LLC and the Kern, Inyo, Mono Building and Construction Trades Council 

Contra Costa County – Developer Project Labor Agreements Applying to Schools

San Ramon Valley Center Campus of Contra Costa Community College District Project Labor Agreement between Windemere-Brookfield-Centex and UA Plumbers and Steamfitters Union Local 159

Almond Grove Elementary School of Oakley Union Elementary School District Project Labor Agreement 2004 between Pulte Homes and UA Plumbers and Steamfitters Union Local 159, International Brotherhood of Electrical Workers Union Local 302, and Sheet Metal Workers Union Local 104

Seven Schools (Including Creekside Elementary School) of San Ramon Valley Unified School District Project Labor Agreement between Shapell Industries and Windemere and UA Plumbers and Steamfitters Union Local 159 and International Brotherhood of Electrical Workers Union Local 302*

Placer County  – Developer Project Labor Agreements Applying to Schools

Junction Elementary School, Barbara Chilton Middle School, and Three Other Schools of Roseville City School District 2005 between Westpark Associates and Signature Properties and UA Plumbers and Steamfitters Union Local 447, International Brotherhood of Electrical Workers Union Local 340, and Sheet Metal Workers Union Local 162

Ventura County – Developer Project Labor Agreements Applying to Schools

Rio Del Mar Elementary School, Rio Vista Middle School, and Another Elementary School of the Rio School District in the RiverPark Development 2004 between RiverPark Development, LLC and Shea Homes with the Ventura County Building and Construction Trades Council

Rio Del Mar Elementary School, Rio Vista Middle School, and Another Elementary School of the Rio School District in the RiverPark Development 2007 between RiverPark Development, LLC and Shea Homes with the Ventura County Building and Construction Trades Council – Amendment

* I do not have a copy of this Project Labor Agreement, but an Invitation to Bid notice (bid deadline March 11, 2008) from Roek Construction (based in Stockton) for the $22 million new Creekside Elementary School (in Shapell Industries’ Alamo Creek Development) for the San Ramon Unified School District states that “The owner does have project labor agreements from the plumbing and electrical trades on this project.” A contractor informed me via phone that Shapell Industries and Windemere were signatory to the Project Labor Agreement.

Bakersfield and Kern County Experience Economic Growth and Job Creation

UPDATE: Here’s a December 29, 2012 Associated Press article Din of Hammers, Oil Wells Signal Bakersfield Boom. Excerpts from the article:

Bakersfield and surrounding Kern County find themselves in lofty positions on key national lists measuring economic vitality: No. 1 metro area for long-term private sector job growth, No. 1 county for construction gains and No. 1 large metro area for annual economic growth.

Cheap land, affordable housing, proximity to Los Angeles, a location that’s within a three-hour drive of 90 percent of the state’s population, and a planning department that doesn’t throw up roadblocks are driving the region’s economic revolution, business leaders say.


The Los Angeles Times had a September 10, 2012 article reporting that Many Signs Point to a Bakersfield Boom. It opens with the following:

This mid-size city has become the surprise star of the Central Valley.

The state’s economic recovery has largely been concentrated on the coast, leaving behind much of the hard-hit San Joaquin Valley. But Bakersfield, perhaps best known for oil, agriculture and country music, has reclaimed an old title: boomtown.

Bakersfield has been adding population and jobs at a brisk pace and is a few thousand jobs from matching its peak employment level of five years ago. A price-fueled energy bonanza, low corporate operating costs and an advantageous location are contributing to the area’s good fortune.

Employment has grown across many sectors, including manufacturing. Even construction, which suffered mightily statewide during the housing bust, has strengthened. And unlike many struggling municipalities, in Kern County officials have recommended a budget increase that would allow hiring of more than 150 people.

Signs of growth are obvious.

Actually, it isn’t surprising that Bakersfield and Kern County are prospering. Kern County’s economic activity focuses on commodities, such as oil, natural gas, mineral mining, agriculture, and energy production. The states of North Dakota and Alaska are prospering for the same reason.

Of course, economic prosperity attracts parasites, such as state legislators from coastal cities who want to tax Kern County’s commodities and send the money to the University of California at Berkeley. (See my May 22, 2011 article in www.FlashReport.org entitled Culture Clash: The “Bakersfield Oil Field to Berkeley Sports Field Tax.”) Bakersfield’s business and political leaders also need to remain wary of the union political agenda that is so dominant in other parts of California.

I was disappointed to see that the Los Angeles Times article turns to Bakersfield union officials to report on the current status of the local construction industry, even though the region’s construction workers overwhelmingly do not belong to a union. The reporter should have contacted the Bakersfield-based Central California Chapter of Associated Builders and Contractors (ABC) to get the status of construction in the region. Any major construction projects in Kern County monopolized by unions have to bring in numerous union workers from outside the Bakersfield area.

Even worse, the article omits some important context in these two union references:

“We have work in the oil fields,” said Danny Kane, business manager for the International Brotherhood of Electrical Workers, Local 428, based in downtown Bakersfield. “We have a lot of solar work. We have wind. We are just fortunate to have those opportunities in Kern County.”

John Spaulding, executive secretary of the Building Trades Council for Kern, Inyo and Mono Counties, said that although hiring has increased in the last year, larger and more long-term projects needed to get off the ground to see the recovery accelerate. Spaulding said he was looking forward to the start of construction on a hydrogen energy plant late next year, which is expected to be a multiyear project that would employ thousands. “I think it’s going to get better,” he said. “There’s some movement.”

Why are unions officials so confident about working on the proposed hydrogen energy plant and on proposed solar and wind projects in Kern County? It has nothing to do with union productivity, efficiency, or competitiveness – it has to do with their “greenmail.” A Sacramento-based group called California Unions for Reliable Energy (CURE) routinely uses the Bay Area law firm of Adams, Broadwell, Joseph & Cardozo to object to such projects using the California Environmental Quality Act (CEQA) until the developer agrees to sign a Project Labor Agreement giving unions monopoly control of the construction.

Through the legal work of Adams, Broadwell, Joseph & Cardozo, California Unions for Reliable Energy (CURE) intervened in the power plant licensing process at the California Energy Commission and won Project Labor Agreements in the late 1990s and early 2000s for natural gas power plants in Kern County, including the High Desert, Elk Hills, La Paloma, and Sunrise power plants. Six unions hired the same law firm and for two years (2007 and 2008) used CEQA to try to block the proposed (but later abandoned) expansion of the Big West/Flying J refinery in Bakersfield. And California Unions for Reliable Energy (CURE) is again active in Kern County, this finding environmental problems with solar and wind electrical generation facilities proposed by companies such as Recurrent Energy and getting a Project Labor Agreement for the proposed Hydrogen Energy California power plant.

Will unions and taxes slow this boomtown down? I wouldn’t be surprised.

Happy Holidays: News Coverage of California Labor Issues on Labor Day 2012

It seems to me that Labor Day news coverage focusing on labor union issues in California was much less in 2012 than in past years. I have a big file of Labor Day press clips from when unions were flying high during the years of Governor Gray Davis (1999-2003), but this year’s news coverage is fairly sparse.

Here’s various Labor Day 2012 news stories, opinion pieces, and press releases about labor unions and labor policy issues in California:

Los Angeles Daily News article (On Labor Day, Trying Times for Organized Labor – Los Angeles Daily News – September 2, 2012) reports that unions are on the defensive in politics, in commerce, and in collective bargaining for government employees.

The Santa Cruz Sentinel reported on the Monterey Bay Central Labor Council‘s annual Labor Day picnic in Santa Cruz. Quotes from attendees mainly refer to the legislative accomplishments of unions from 125 years ago. The Vice President of the Labor Council is quoted as saying, “Who had ever heard of a weekend before the unions came along? People assume it’s there and always has been there, and it hasn’t.” See Picnic Draws Union Members to DeLaveaga Park – Santa Cruz Sentinel – September 3, 2012.

As reported in the Sacramento Bee, unions provided food for the homeless on Labor Day and received some positive press coverage: Unions Supply Volunteers for Labor Day Lunch at Loaves & Fishes – Sacramento Bee – September 3, 2012. Many of the 75 comments about the article cynically accuse the unions of a public relations stunt.

KQED in San Francisco posted a blog providing a brief history of union power in San Francisco in the early 1900s. Labor Day Special: The San Francisco Waterfront Strike of 1901 – KQED – August 31, 2012.

Los Angeles Times pro-union columnist Michael Hiltzik provided a positive union perspective through a report on the rigors of apprenticeship training for the Ironworkers Union Local No. 416 and Ironworkers Union Local 433 in Southern California. (Ironworkers Union Gives Skills to Members, Public Safety to All – Los Angeles Times – September 2, 2012.) This column relies on the old image of labor unions: a brotherhood of men centered around tough, dangerous work in the construction trades. It also acknowledges some of the shortcomings of unions, including the result of the Ironworkers union having a monopoly on state-approved apprenticeship training for the trade:

Getting into the ironworkers apprenticeship program isn’t a snap. It may help to have a relative, or even a well-wishing neighbor or family friend, in the Ironworkers, but that’s not a prerequisite, nor is it enough. Applicants, who have to be at least 18 with a high school diploma or equivalent, must line up a construction contractor willing to sponsor them with at least six weeks of employment before they can start. That explains why, with the local construction market still soft and the building trades still suffering from about 40% unemployment, there’s a waiting list of about 5,000 applicants looking for sponsors right now.

So there’s a waiting list of 5000 people for how many spots? And nepotism is still important to get in? This is an example of how apprenticeship programs can be used to control who and how many people enter the construction workforce.

Meanwhile, Sacramento Bee columnist Dan Walters took a more relevant and contemporary view on the influence of labor unions in California. Here are excerpts from California Unions Hold Power but Face Peril – Sacramento Bee – September 3, 2012:

Anyone who was paying attention to the California Legislature during the hectic final days of the 2012 session last week could see the political clout of the state’s labor unions.

Countless union-backed bills whipped through the Capitol and onto Gov. Jerry Brown’s desk. Although union lobbyists lost a few battles, they could count many more victories.

With the Legislature’s Democratic majority utterly beholden to unions for political sustenance and with a governor, Jerry Brown, whose 2010 campaign relied on union financing, unions and their 2.4 million members are at the apogee of political influence.

Finally, a writer for the leftist San Diego Free Press asks this ridiculous question on September 3, 2012: Is This California’s Last Labor Day? This article focuses on Proposition 32, a statewide measure described on the November 6, 2012 ballot as follows: “Prohibits unions from using payroll-deducted funds for political purposes. Applies same use prohibition to payroll deductions, if any, by corporations or government contractors. Prohibits union and corporate contributions to candidates and their committees. Prohibits government contractor contributions to elected officers or their committees.”

This doesn’t seem unreasonable, but recognize that labor unions, big corporations, and government contractors are all in cahoots in California to perpetuate Big Government, at the expense of individuals and small businesses. Proposition 32 would stop some of that special interest money funding state and local political campaigns, while unions and their cronies in business are determined to keep the status quo by convincing a majority of voters to reject it.

In 2012, Election Day is more important to California unions than Labor Day. Perhaps that’s why there was little news coverage.

CEQA Reform is Over for This California Legislative Session: Sustainable Environmental Protection Act May Return in 2013

CEQA reform is over for this legislative session.

Some union officials, environmental lobbyists, and lawyers specializing in exploiting the California Environmental Quality Act (CEQA) are celebrating with emailed bulletins and tweets. (See the August 23, 2012 “Sierra Club California Statement on Abandonment of Environmentally Dangerous Bill.”) One particularly happy Tweeting union leader is Lorena Gonzalez, head of the San Diego County Central Labor Council, AFL-CIO.

That’s no surprise if you read my August 8 post,”Unions Submit 436 Pages of Objections to Draft Environmental Impact Report for Proposed San Diego Convention Center Phase III Expansion Project: CEQA Abuse Run Rampant.”

UNITE HERE Local 30 (based in San Diego) and the San Diego County Building and Construction Trades Council have filed a massive CEQA objection with the United Port of San Diego concerning the Draft Environmental Impact Report (EIR) for the proposed San Diego Convention Center Phase III Expansion Project and the adjacent Hilton San Diego Bayfront Hotel expansion.

Here are some recent Tweets from Lorena Gonzalez ‏@LorenaSGonzalez:

And the Rubio #CEQA reform bill is officially dead! Yay!

URGENT: Don’t let them gut California Environmental Quality Act. Sign NOW: http://SaveCEQA.com  #CEQA #SaveCEQA

I support #CEQA. Gutting 40 years of progress will hurt the environment, workers and the public! These aren’t reforms, they go too far.

So happy to see most of our SD Democratic Legislators asking their colleagues to keep their hands off CEQA #SaveCEQA

Meanwhile, I posted this in the comment section of the Sacramento Bee article, “Bid to Overhaul California Environmental Law Falls Short“:

The Sierra Club representative called the bill “one of the worst attacks on environmental protections that we’ve seen in the 40-year life of this law.” They actually mean, “one of the worst attacks on our political agenda from Democrats, whom we thought would never betray us by supporting economic growth and job creation.”

Actually, it’s questionable whether or not this “Sustainable Environmental Protection Act” of 2012 would have been all that effective in hindering the professional CEQA operators – the people who use CEQA for economic or financial objectives. It was certainly tame and weak compared to Assembly Bill 598, for which the Sierra Club lobbyist took great offense during a January 9, 2012 hearing of the Assembly Natural Resources Committee. If that bill had become law, it would have shut down the CEQA extortion industry by limiting the authority to file lawsuits under CEQA to the California Attorney General.

The Sierra Club and the Natural Resources Defense Council can continue to enjoy their “Blue-Green Alliance” of convenience with labor unions and turn a blind eye to how CEQA is exploited for purposes other than environmental protection, such as coercing Project Labor Agreements, Neutrality Agreements, etc.

They’ve been coasting for 40 years on the Friends of Mammoth v. Board of Supervisors of Mono County decision of the California Supreme Court in 1972, which stunned many by applying CEQA to private projects and activities. One day soon the political pendulum will swing to the Right in this state (probably after the state tries to file for bankruptcy), and then AB 598 will become law.

In the meantime, enjoy the CEQA paperwork! For example, here’s what the Fresno County Planning and Land Use Division has been dealing with as unions object to proposed solar energy power plants:

The Fresno County Planning and Land Use Division responds on August 7, 2012 to a request for records concerning submissions of the law firm of Adams Broadwell Joseph & Cardozo on behalf of California Unions for Reliable Energy (CURE) concerning proposed solar energy generation projects.

Moody’s Suggests Greedy Taxpayers Clinging to Their Money and Too Much Local Government Authority Are Causes of Municipal Bankruptcies; Predict More to Come

UPDATE: Inglewood Unified School District was indeed the next school district to be taken over by the state, as predicted below. On September 14, Governor Jerry Brown signed Senate Bill 533, a bill amended on August 15, 2012 to authorize emergency loan assistance to the school district of up to $55 million. Senate Bill 533 also requires the State Superintendent of Schools Tom Torlakson to assume all the rights, duties, and powers of the school board and appoint a state administrator for the district.

Note that the Inglewood Unified School District Superintendent Gary McHenry was the Superintendent of the Mt. Diablo Unified School District in the mid-2000s when the school board spent years arguing over requiring construction contractors to sign a Project Labor Agreement with unions to work on certain projects at the district.


ADDITIONAL THOUGHT: as I was writing about the Costa Mesa City Council’s derailed cost-efficiency plan on the morning of August 18, 2012 (Costa Mesa’s Bold and Meaningful Government Cost-Efficiency Plan on Hold Until November 6, When Citizens Vote on a Proposed Charter (Measure V) and for Three City Council Members), I realized that Moody’s looks at strong local government authority without considering all of the potential POSITIVE aspects of strong local governments and “home rule” under charters. A 4-1 majority on the Costa Mesa City Council is asking voters to enact a charter on November 6 through Measure V that would allow it more freedom and flexibility to save money for taxpayers by contracting out services and exempting local construction from state-mandated construction wage rates (so-called “prevailing wages”).

The people sending out the message from Moody’s about city bankruptcies in California apparently didn’t think much about wasteful government spending and the flexibility that comes with local control. They simply blame democratic obstacles to tax increases (“raising revenues is difficult for all California cities because tax hikes require voter approval”) and insufficient centralized government control (“unlike other states that are empowered to intervene in the financial affairs of stressed local governments, California’s strong ‘home rule’ means local governments get relatively little financial, technical, or oversight help from the state”).

If institutional investors are foolish enough to buy bonds issued by the City of Compton and the Inglewood Unified School District, why do California taxpayers need to bail out those investors with tax increases and costly state government interventions?


Imagine the constant pressure on the Howard Jarvis Taxpayers Association as it responds in bad times (as well as in good times) to the relentless claims that California would be so much better without those silly laws (especially Proposition 13) enacted by greedy, uncaring, ignorant voters who want to limit tax increases. When will people be more willing to share their bounty for the public good?

The latest subtle attack on the selfish taxpayer comes from Moody’s Investors Service. Today (August 17, 2012) Moody’s announced the release of a report entitled “Why Some California Cities Are Choosing Bankruptcy.” The announcement on the Moody’s web site hints of fundamental problems in California that include the following: (1) governments aren’t taking enough money in taxes and fees from their citizens to pay for services and other obligations; and (2) the state government isn’t strong enough to effectively meddle in municipal affairs. Here are some relevant excerpts:

[The report] details the economic, legal and policy environment that is helping to drive the increase in bankruptcy filings and defaults by California cities and concludes that the risk profile of California cities has increased across the board. Factors include the state’s boom-bust real estate economy, its hands-off policy with regard to the fiscal problems of local governments, and newly enacted legislation that … effectively lays out a path to bankruptcy court for stressed municipalities…

“Raising revenues is difficult for all California cities because tax hikes require voter approval,” said Moody’s Managing Director Gail Sussman. “And, unlike other states that are empowered to intervene in the financial affairs of stressed local governments, California’s strong “home rule” means local governments get relatively little financial, technical, or oversight help from the state.

“The inability and unwillingness to honor obligations to bondholders is relatively new in US public finance and still remains rare,” said Sussman. “The emergence in California of bankruptcy as a tool to extract bondholder concessions as part of a budgetary solution is a significant new risk for bondholders.”

“Stressed local governments” need a financial massage from the taxpayers through “raising revenues” and an “empowered” state government. A Reuters article about the report picks up on the theme:

The remedies California’s municipalities can employ are more limited than those of some other states, citing restrictions on property tax hikes and cities’ considerable independence from the state government, Moody’s said.

Get it? Local communities are too independent, and they selfishly want to keep their own money. They need to give away more money and more power to the wise in Sacramento, and then some of it will come back.

Here is a counter-perspective, which can be done by citing Moody’s own words:

Looking at the last couple of months of ratings issued by Moody’s for California local governments, it looks like the City of Compton might be the next city to file for Chapter 9 bankruptcy. On July 23, 2012, Moody’s announced that it had downgraded the rating for the City of Compton‘s $4.9 million in Sewer Enterprise revenue bonds from A2 to to Ba1 with the possibility of further downgrades. Apparently the city is collecting more than enough money from its sewer bills to make its payments on these bonds. Some other pesky issues have come up, such as “weak internal controls and management practices” and “severe General Fund overspending relative to budgeted amounts” and “waste, fraud and abuse.”

The downgrade is based primarily on the city’s severe liquidity crisis, the risk this raises that the city could seek bankruptcy protection, and the potential implications of such a development on timely debt service payments. The sewer enterprise currently generates more than sufficient net revenues to make debt service payments, and the Ba1 rating reflects our expectation of full, if not timely, debt service payment, assuming revenues have been allocated as legally required. The downgrade also reflects the city’s weak internal controls and management practices, highlighted by the depth of the liquidity crisis; recent, severe General Fund overspending relative to budgeted amounts; and allegations of waste, fraud and abuse of public monies by the city’s Mayor. These allegations undermine our expectation that the city will properly account for and transfer pledged enterprise revenues to bond trustees consistent with trust agreements to ensure timely debt service payments. Uncertainty also derives from the city’s inability to produce audited financial information on a timely basis.

The July 18, 2012 Los Angeles Times suggested that the City of Compton would be the next city to go bankrupt: see “Compton on Brink of Bankruptcy: The city is the latest to fall victim to questionable financial practices. It could run out of money by the end of the summer.” (The article hedged its bets by also mentioning Victorville and Montebello.)

At California school districts, it looks like the Inglewood Unified School District might be the next school district to be taken over by the state. On June 28, 2012, Moody’s announced that it had downgraded the rating for the Inglewood Unified School District‘s $113 million worth of outstanding general bond obligations from A3 to Baa1. It also assigned a “negative outlook” because of “the district’s continued fiscal crisis and the possibility it could be forced into state receivership to remain solvent.”

According to an April 20, 2012 announcement about the Inglewood Unified School District from Moody’s, this school district has been spending more while taking in less and educating fewer students:

The district’s financial position has eroded to a level of near insolvency that requires an immediate correction to maintain operations. The current financial position occurred due to growing expenditures during a period of acute revenue decline. Revenue decline has been driven by two main factors: declining enrollment averaging 4.8% annual decrease over a five year period, and reductions of state aid experienced by all California school districts beginning in fiscal year 2008. The district’s operational imbalance was funded during fiscal years 2009 and 2010 by Federal ARRA funds and the use of the district’s reserve funds. Fiscal year 2010 ended with a General Fund balance of $3.8 million, 3.4% of revenues, a significant drawdown since fiscal 2007’s balance of $17 million, or 12.8% of revenues.

Speaking of school bonds, notice all the wonderful things that happened after Californians voted in 2000 to reduce the voter approval threshold for school districts to sell general obligation bonds for school construction from two-thirds to 55%. School districts went wild borrowing money from bond investors, often by selling Capital Appreciation Bonds. Today the kids enjoy their new and renovated school facilities, and tomorrow their families will enjoy a lifetime of renting when property taxes shoot through the roof in 20-30 years to pay off the compound interest from those bonds. (Don’t worry, I’m sure the state government and local governments will institute laws to control the rent.)

Really, do you want to give more money to the City of Compton and the Inglewood Unified School District, the way they’re run today? The problem is not that Californians aren’t giving enough money to their government. The problem is the government itself.

Is REAL Reform of the California Environmental Quality Act (CEQA) in the Works? Here’s the Test: Does the Reform Measure Discourage Union GREENMAIL?

There is a sudden burst of talk out of California’s state capitol regarding the possibility of some sort of amendment to the California Environmental Quality Act, or CEQA (California Public Resources Code Section 21000 et seq.). Consider the news reports today.

Environmentalists, unions fear last-minute CEQA changes” according to the Los Angeles Times. Sacramento Bee columnist Dan Morain reports that Using CEQA as bait, [Assembly Speaker John] Pérez muscles tax bill. The San Diego Union-Tribune has just published an editorial on its web site for August 16, 2012 (“Finally, Momentum to Reform Regulations, Help Economy“) that expresses astonishment about the serious possibility of significant changes to CEQA:

Now there are reports that Assembly Speaker John Pérez is considering backing a reform that is beyond anything business groups ever thought could emerge out of Sacramento: exempting projects that adhere to local planning and zoning codes from CEQA review entirely. If this somehow made it into law – and if the three ex-governors were heeded and CEQA stopped being a tool for obstruction and legal extortion – this would be remarkable indeed.

All of these developments have triggered sharp expressions of concern from the Sierra Club, the Planning and Conservation League and other environmental groups. But they would have far more credibility if they’d spoken out against how CEQA has been used for “greenmail”: to extract money from developers.

It’s about as unsubtle as it gets: Warning of environmental disaster if a project proceeds, labor groups file a vast list of CEQA objections that would take many years to resolve. When they get the pay and benefits concessions they want, suddenly their environmental concerns vanish.

This editorial hits the same concerns about union “greenmail” using CEQA that the Fresno Bee addressed in its August 6 editorial “Governor Again Moves Toward Needed CEQA Reform Steps: Changes to the state law should be vetted and discussed by all parties and the Modesto Bee addressed in its August 11 editorial “Study CEQA in the Open.”

In my opinion, Californians will be able to test the seriousness of CEQA reform if the proposed changes hinder the ability of construction trade unions to exploit the law as a weapon to force private developers to sign Project Labor Agreements and make other economic concessions.

In January 2012, the Assembly Natural Resources Committee considered and rejected a dramatic proposed CEQA reform bill (Assembly Bill 598) introduced by Assemblywoman Shannon Grove (R-Bakersfield) that would have given the California Attorney General the sole and exclusive right to file lawsuits against governments for inadequate environmental review under CEQA. I believe this is the ultimate fate of CEQA if meaningful reforms do not occur soon.

Here are the opening and closing statements of Assemblywoman Grove when her Assembly Bill 598 was considered in committee on January 9, 2012.

Opening Statement

Thank you Mr. Chair and fellow Members.

Any private developer or public agency in California that considers building anything of significance knows that one of the chief obstacles is the California Environmental Quality Act, better known as CEQA. The problem is not so much complying with the requirements of CEQA, however. The problem is dealing with the many parties that exploit CEQA for ends unrelated to environmental protection.

CEQA was signed into law in 1970 by then-Gov. Ronald Reagan with the intent to “develop and maintain a high-quality environment now and in the future, and take all action necessary to protect, rehabilitate and enhance the environmental quality of the state.” Yet, like many noble efforts, CEQA has been repeatedly abused and is now hindering economic growth throughout California.

In an all-too-common scenario, labor union interests are often behind CEQA lawsuits filed against a construction project on the claim that they are merely looking out for the environment, only to drop the suit once the business owner agrees to employ unionized labor. This practice, properly known as “greenmail,” is rampant up and down the state. Allow me share some examples.

+ Last year, the Teamsters union filed a CEQA lawsuit against VWR International, a distributor of laboratory supplies. The union, in an attempt to intimidate VWR International into signing a union labor agreement at a proposed new facility in Visalia, is using CEQA to allege that trucks entering and exiting the facility will harm the environment. This large facility is likely to employ more than 100 people in a county that has an unemployment rate over 15% and desperately needs jobs, yet there are truckers trying to stop the use of trucks! And this is after an EIR has already been approved for the process.

+ In 2009, the California Nurses Association sued Alameda County under the pretense that the county did not comply with CEQA in approving a project to demolish the deficient Eden Medical Center Hospital and other buildings and replace them with a new state of the art hospital and medical office complex. The nurses’ union did not want Sutter Health to close the San Leandro Hospital and reduce the number of beds at the Eden Medical Center. Here we see nurses protesting against a state-of-the-art new hospital.

+ The Service Employees International Union filed a CEQA lawsuit in 2007 to stop construction of Providence Holy Cross Medical Center in Mission Hills and a CEQA lawsuit in 2006 to stop construction of Sutter Medical Center in Sacramento. Both of these lawsuits occurred in the context of SEIU organizing campaigns.

+ The United Food and Commercial Workers Union has been behind numerous CEQA lawsuits filed by a Davis lawyer against proposed Wal-Mart projects in Northern California. These lawsuits are related to unions concerns over non-signatory competition for grocery sales.

As you can see, unions are abusing our environmental laws in order to extract the project labor agreements that they seek. However, it is not only unions abusing CEQA. Businesses have been known to sue on the grounds of environmental protection simply as a way to fight off competition. All the more reason that Californians should be appalled at how the legitimacy of the state’s environmental protection laws is undermined and trivialized by special interest groups with ulterior motives.

This is a slap in the face to any Californian who is truly looking out for the environment, and it is crushing business development and job creation. Something drastic needs to be done. AB 598 would establish a policy that a lead agency’s decision to approve a project, certify an environmental impact report or adopt a mitigated negative declaration based on an initial study for a project is not subject to review by a court, except for reviews initiated by the Attorney General.

It is the constitutional duty of the California Attorney General to see that the laws of the State are uniformly and adequately enforced. The repeated abuse of CEQA to hold up projects while labor unions and others pursue non-environmental goals has proven to be bad public policy. This bill will provide businesses protection from frivolous attacks by organizations alleging environmental concerns, yet still ensures citizens, through the Attorney General, the people’s attorney, the recourse against legitimate environmental concerns.

Thank you very much.

Closing Statement

Colleagues, I am not asking for CEQA to be eliminated.  We do need to protect the environment.

I am asking that after a lead agency makes a judgment on its environmental impact, that the proposed project not be subject to a frivolous lawsuit.

I am asking to eliminate the abuse and allow the people’s attorney of the state of California to be the one to uniformly enforce our environmental laws. The Attorney General’s office may not believe they have enough time or resources for this, but that is simply not a valid excuse to just sit by and watch this abuse occur.

This abuse of CEQA is mocking the legitimate attempts at using CEQA to protect our environment, and is CRUSHING job creation and the entrepreneurial spirit that has built California. California consistently ranks as one of the least business-friendly states in America. Instead of promoting job creation by encouraging businesses to build and expand, we discourage them with costly regulations and lawsuits. California needs jobs. We cannot afford to continue treating businesses like adversaries. Eliminating the misuse of our environmental law will send at least one clear signal that the Legislature is serious about addressing the structural changes necessary to improve California’s economy.

I ask for your ‘Aye’ vote.  Thank you.

###

California’s Top Construction Union Boss Opens the Slush Fund Hydrant: $1.14 Million Full-Blast Against San Diego’s Proposition A Voter Initiative

Here’s yet another scoop from the Dayton Public Policy Institute about how unions are influencing the June 2012 elections in California: one supreme union official based in Sacramento has pumped $1.14 million into San Diego to defeat a city voter initiative called Proposition A. And some of the cash originally comes from utility ratepayers.

For readers unfamiliar with Proposition A, read immediately below. Those who know about Proposition A can proceed down to read about the union sources of $1.14 million for the No on A campaign.

Who Supports Proposition A in San Diego, and Why?

In 2011, San Diego voters signed petitions to qualify a Fair and Open Competition ordinance for consideration in the June 5, 2012 election. It was the first measure placed by voters on the city ballot since 1998. Now designated on the ballot as Proposition A, the Fair and Open Competition ordinance would prohibit the City of San Diego from requiring construction companies to sign a Project Labor Agreement (PLA) with unions as a condition of working on a taxpayer-funded project. It also contains language requiring the city to post certain contract information on-line.

The campaign to enact Proposition A is strongly supported by construction companies and construction trade associations. This is no surprise, since most construction companies work directly with their employees (either individually or collectively through a union) to determine the terms and conditions of work. They don’t want two-bit local politicians to negotiate separate 30-page to 60-page labor agreements with union officials (i.e. the politicians’ campaign contributors) and then impose those agreements on their businesses.

Many companies refuse to bid on work that includes a government-mandated Project Labor Agreement in the bid specifications. The resulting reduction in the number of bidders competing for contracts results in higher costs for taxpayers (as academic studies, basic economic theory, and common sense would predict).

See the YES on A campaign web site here and contributors to the YES on A campaign here.

Who Opposes Proposition A in San Diego, and Why?

The main opponents of Fair and Open Competition policies are obviously construction trade unions, which regard government-mandated Project Labor Agreements as an effective political tactic to cut bid competition and raise costs for their own benefit. With Project Labor Agreements, union organizers can completely avoid the unpleasant and time-consuming task of selling the benefits of unionization to skeptical workers. Instead, they simply ask their political allies in government to give them a union monopoly on construction!

Most construction unions in California belong under the umbrella of the State Building and Construction Trades Council of California, a union conglomerate based in Sacramento under the leadership of president Bob Balgenorth. If you look at the list of contributors to the No on A campaign (Taxpayers to Preserve Community Jobs, No on Measure A, sponsored by labor and management organizations), you’ll see the top two donors are Sacramento-based union-affiliated organizations under the direction of Bob Balgenorth. These two entities contributed $1.14 million to the No on A campaign, comprising 96% of all campaign receipts.

Let’s take a closer look at these two massive organizations funding the No on A campaign. One of them is a routine political action committee, but the other is a conspiracy theorist’s dream come true.

A Union Political Action Committee Gave One $45,000 Late Contribution, Comprising 3.8 Percent of the Contributions to the No on A Campaign

The Sacramento-based committee known as “Members’ Voice of the State Building Trades Council of California” made a late expenditure contribution of $45,000 to the No on A campaign on May 24. As you can see on the California Secretary of State’s web site, this committee collects money from various local construction unions and disburses the money to various campaigns for candidates and ballot measures. The Assistant Treasurer of the Members’ Voice of the State Building Trades Council of California is Bob Balgenorth.

A Mysterious Union Slush Fund, Authorized by an Obscure 1978 Federal Law to Encourage Better Relationships Between Unions and Manufacturers, Gave $1,095,000 to No on A – a Whopping 92% of All Receipts!

Something called the California Construction Industry Labor-Management Cooperative Trust contributed a total of $1,095,000 to the No on A campaign. This is an extraordinarily high amount for a political contribution from one entity, especially concerning a local ballot measure! The head of the California Construction Industry Labor-Management Cooperative Trust is Bob Balgenorth.

This is NOT a traditional Political Action Committee. It is an arcane type of union trust authorized by the obscure Labor-Management Cooperation Act of 1978, a law signed by President Jimmy Carter and implemented by the Federal Mediation and Conciliation Service. Inspired by the decline of unionized manufacturing in the Northeast, this federal law was meant to help industrial management and union officials build better personal relationships and cooperate against the threat of outside competition. There are no federal or state regulations specifically addressed toward these trusts, and these trusts do not have any reporting requirements to the U.S. Department of Labor’s Office of Labor-Management Standards. This is an ambiguous and forgotten law that’s ripe for abuse.

It’s Not Union Members that Give the Money to the California Construction Industry Labor-Management Cooperative Trust: It’s Utility Ratepayers and Contractors Working for Extorted Power Plant Owners

Since the 1990s, whenever an energy company or public utility submits an application to the California Energy Commission seeking approval of a new power plant, an organization called California Unions for Reliable Energy (CURE) often “intervenes” in the licensing process. Represented by a South San Francisco law firm called Adams Broadwell Joseph & Cardozo, CURE submits massive data requests and environmental objections to the California Energy Commission. The applicant by law is required to answer CURE’s submissions, at significant cost and delay. The chairman of California Unions for Reliable Energy (CURE) is Bob Balgenorth.

If the power plant owner agrees to sign a Project Labor Agreement and require its construction contractors to sign a Project Labor Agreement with the State Building and Construction Trades Council of California or its regional affiliates, CURE’s objections go away and the power plant can proceed unhindered through the licensing process. If the company or utility does not surrender to CURE’s demand, then CURE’s interference and lawsuits continue.

This racket – sometimes called “greenmail” because it’s the use of environmental laws to pressure developers to sign Project Labor Agreements – is well-known to the energy industry in California and has been extensively reported in the news media over the past dozen years. (For example, see Labor Coalition’s Tactics on Renewable Energy Projects Are Criticized – Los Angeles Times – February 5, 2011.)

For cases in which the power plant applicant succumbs to CURE’s harassment, the Project Labor Agreement that the power plant owner signs usually contains a provision requiring the owner or its contractors to make a lump-sum payment or series of payments to the California Construction Industry Labor-Management Cooperative Trust.

For example, the Project Labor Agreement signed by the Northern California Power Agency (a conglomerate of publicly-owned utilities) for the construction of the Lodi Energy Center required the agency to shell out $90,000 to the California Construction Industry Labor-Management Cooperative Trust. That amount was dutifully mailed to Bob Balgenorth on August 17, 2010. (For more on this payment, see High Energy: Lodi Center Designed to be a Powerhouse for Chunk of State – Stockton Record – October 4, 2011; also, the union rebuttal on the California Building Trades Council web site – ABC Falsehoods Refuted in Letter to Stockton Record – a denial that the California Construction Industry Labor-Management Cooperative Trust is used for political contributions.)

And the Project Labor Agreement signed by the Southern California Public Power Authority (another conglomerate of publicly-owned utilities) for the construction of the City of Anaheim’s Canyon Power Plant required the agency to shell out $65,000 to the California Construction Industry Labor-Management Cooperative Trust. See Section 13.1 of the Project Labor Agreement here.

The California Construction Industry Labor-Management Cooperative Trust reports these payments as “membership dues” to the Internal Revenue Service. Which brings up a question: are the local elected officials who serve as commissioners for the Northern California Power Agency and the Southern California Public Power Authority exercising their responsibilities as “members” to approve $1,095,000 in political contributions to the No on A campaign?

But Wait a Minute…Is It Legal to Have Utility Ratepayers Fund a Mysterious Union Trust Fund that Contributes to Political Campaigns, Such as No on A?

Well, in 2009 an internal committee of the Northern California Power Agency discussed whether or not a payment to the California Construction Industry Labor-Management Cooperative Trust was an illegal gift of public funds. (See here. Note the original amount to the California Construction Industry Labor-Management Cooperative Trust was supposed to be $150,000, but aggressive opposition to the Project Labor Agreement forced the unions to cut it down to $90,000 in order to win approval from the board of commissioners.)

To solve this uncertainty, in May 2011 State Senator Mark Leno (D-San Francisco) added a cryptic amendment at the request of union lobbyists and lawyers to the end of a large unrelated public utilities bill (Senate Bill 790) regarding “community choice aggregation.” It added Section 3260 to the Public Utilities Code: “Nothing in this division prohibits payments pursuant to an agreement authorized by the National Labor Relations Act (29 U.S.C. Sec. 151 et seq.), or payments permitted by the federal Labor Management Cooperation Act of 1978 (29 U.S.C. Secs. 173, 175a, and 186). Nothing in this division restricts any use permitted by federal law of money paid pursuant to these acts.”

No one in the California State Legislature – apparently not even Senator Leno – initially knew what this strange new provision meant. In the end, a few legislators such as Assemblywoman Shannon Grove (R-Bakersfield) came to understand and reveal in floor debate that it authorized public utilities to pass on the costs of payments to labor-management cooperation committees to ratepayers. Governor Brown signed the bill into law with the language tacked on the end.

For more information, see the investigative report of the Coalition for Fair Employment in Construction at this September 23, 2011 post at www.TheTruthaboutPLAs.com: A Genuine California Union Conspiracy: Senate Bill 790 and the California Building Trades Council’s Ratepayer Funded Political Slush Fund

Confused about the Conspiracy? Here’s a Chart.

A public utility or private energy company applies to the California Energy Commission for approval to build a power plant.

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California Unions for Reliable Energy (CURE) uses its “intervenor” status at the California Energy Commission to submit massive data requests and environmental complaints about the proposed power plant, as a result gumming up the licensing process and causing costly and lengthy delays for the applicant.

 ↓

Applicant for prospective power plant surrenders and agrees to sign Project Labor Agreement with State Building and Construction Trades Council of California or its regional affiliates. CURE releases its grip of legal paperwork and the project moves forward unimpeded and acclaimed as environmentally sound.

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The Project Labor Agreement contains a required payment or payments to the California Construction Industry Labor-Management Cooperative Trust. California Public Utilities Code Section 3260 – enacted by Senate Bill 790 in 2011 – allows public utilities to pass costs through to ratepayers.

 ↓

California Construction Industry Labor-Management Cooperative Trust reports those payments to the IRS as “Membership Dues,” creating questions about the rights inherent for dues-paying members.

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California Construction Industry Labor-Management Cooperative Trust makes contributions to political campaigns, such as $1,095,000 to fund 92% of the No on A campaign (Taxpayers to Preserve Community Jobs, No on Measure A, sponsored by labor and management organizations) in the City of San Diego in 2012.

 

 

Inflatable Rat Balloon Gets Swelled Head: Targets Big Banks Instead of Non-Union Local Contractors

The union inflatable rat balloon is regularly in the news and maintains cult status among people who follow construction labor issues. It has even earned its own Wikipedia entry. Allegedly developed 22 years ago by a company near Chicago, the inflatable rat has been a symbol long used by construction unions to bug (and sometimes delight) Associated Builders and Contractors (ABC) and its member companies in California and across the country.

I was dismayed today to see that a construction union apparently lent Scabby to a different crowd – the Occupy Wall Street movement in San Francisco. An inflatable rat balloon was on display on Monday, April 24 and today at a multi-day protest in San Francisco outside the meeting of the Wells Fargo annual shareholder meeting.

The photo at this link was the lead on today’s “Featured Photo Gallery” of San Francisco’s KGO Channel 7 News web site: Protesters at Wells Fargo Shareholders Meeting – Photo 2 of 8.

I was unable to determine using the web which union actually owned the rat, although it is mentioned in numerous blogs and news articles, including this from the Los Angeles Times: Protesters Disrupt Wells Fargo Shareholder Meeting – April 25, 2012

Any Wells Fargo executive or major shareholder who saw this rat might be confused about what message it’s sending to bankers. Notice the rat is wearing an orange construction vest and wears a hard hat that says “Safety Last.”

I suspect a construction union in Northern California allowed its long-recognized symbol of opposition to the Merit Shop to be borrowed for a few days for a protest of the business practices of one of the biggest banks in the United States. Apparently it’s too pedestrian in this day and age to limit the job of rat balloons to the harrassment of family-owned contractors performing tenant improvements at chain restaurants and budget hotels in obscure Bay Area suburban towns.

Keeping an inflatable rat (often costing several thousand dollars) from experiencing erectile dysfunction (ED) is still a job best reserved for the professional union tradesman. As you can see in this Reuters photo, not all went well with the anti-ABC rat turned anti-Wall Street rat.

Demonstrators Try to Contain a Deflating Balloon of a Wall Street Rat… – April 24, 2012