By Gregory B. Hladky
12:10 PM EST, November 27, 2012
A pro-Romney Utah mine owner laid off 102 workers after Obama won. Other top execs, including Aetna's CEO, warn of more layoffs to come if we go over that freakin' federal fiscal cliff. Meanwhile, Connecticut's unemployment is on the rise.
So just how worried should already recession-stressed employees in this state really be?
The consensus from both business and union experts is that Connecticut isn't likely to see any vengeance-related layoffs from corporate types pissed off by Republican Mitt Romney's Election Day flop.
There is, however, a lot of disagreement over how worried we need to be about a failure by Congress to reach agreement with President Obama on a deal to head off those scheduled across-the-board spending cuts and tax increases known as the fiscal cliff.
Leading up to the election, conservative business types like ultra-right wingers Charles and David Koch were warning tens of thousands of employees that they could face loss of employment if Obama were reelected. So far, very few of those threats have actually been carried out, and none by big-time companies.
So far, no one around here has any knowledge of any Connecticut business leader even threatening such a thing.
"I don't think I've heard of those kinds of threats coming from any employer here," says Connecticut AFL-CIO President John Olsen. He dismisses the phenomenon of isolated cases of anti-Obama layoffs as "sour grapes" by some business types down South or out West.
Olsen is also downplaying the warnings of Connecticut business leaders about possibly dramatic layoffs here if Congress and President Obama fail to reach agreement on averting a plunge over that budget cliff.
"I think they're exaggerating the whole thing," Olsen insists. He argues that the corporate execs warning about fiscal-cliff layoffs are simply trying to blackmail federal lawmakers and Obama into protecting tax breaks for business.
"I think they're using this as scare tactics," Olsen says. "If they were really concerned they'd be sitting down in a rational way... and trying to figure out an equitable way to solve the problems we have instead of creating hysteria in their communities."
Peter Gioia has a much grimmer take on those layoff warnings. He's a vice president and economist with the Connecticut Business & Industry Association, the state's biggest business organization.
"I don't think this is threatening," he says. "I think it's planning."
Gioia does believe the odds are in favor of Congress reaching an agreement to head off those massive budget cuts and tax increases, if only because both Democrats and Republicans have so much to lose if they fail to act and the U.S. plunges back into full-blown recession.
The trouble is that a congressional deadlock on this huge budget controversy is a real and frightening possibility, according to Gioia. He says a recent forecast by Wells Fargo's prognosticators estimated there's a 40 percent chance of Congress "doing nothing" and allowing the nation to topple over the cliff.
He says Connecticut has 40,000 direct defense-related jobs and something like 100,000 jobs indirectly related to state-based defense industries. Failure to reach a budget agreement or at least postpone those defense-related federal spending cuts, says Gioia, would mean Connecticut could suffer "thousands of layoffs."
Gioia says the expert consensus is that, if Congress doesn't reach an agreement until March or April (a real possibility given that dysfunctional institution's history of partisan gridlock), then "the economy is likely to go into recession."
Lack of a deal will also mean "ordinary taxpayers will get clobbered" by higher payroll taxes, Gioia says, and many already on unemployment will see their benefits end.
"If that happens," Gioia says of a potential return to recession, "we're going to get hit... There are going to be some severe hits."
Lindsay Farrell, executive director of the pro-labor Working Families Party, says she's heard the CBIA "cry wolf again and again" on all sorts of issues. Farrell insists that a greater danger, assuming Congress goes into gridlock, is that major cuts will hit the social safety net and leave tens of thousands of seniors and poor people without the support they desperately need.
"I think the notion of a fiscal cliff is much inflated," she argues.
If there's one thing labor and business can agree on, it's that Congress needs to get its act together and end the suspense by coming to a rational, reasonable agreement to avoid all that potential crap.
Unfortunately, political rationality and reasonableness are two things in very short supply down in the nation's capital.
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