August 10, 2009… Mayor Michael White almost helped derail tax abatement in the late 1990s, when his brutal attacks to portray Cleveland teachers as greedy backfired.

White’s nasty nature almost cost him the issue.

The Cleveland Teachers Union counterattacked against White. The union took to the streets and collected an amazing 33,000 signatures to put the issue of curtailing tax abatements on the ballot.

Let’s set up the situation.

The Teachers Union faced contract talks in the summer of 1996. White took a lead role in trying to embarrass teachers into pay cuts. Rather than a small raise, White hoped to bludgeon the teachers into a 10 percent salary giveback.

It was a take-no-prisoners battle.

White tried to paint the teachers as money-grubbers. And he used strike-breaking tactics to try to subdue them. He even brought in strike-breaking goons from Detroit who had just fought in a bitter newspaper strike there. The goons were to cost $65,000 a day. Their job: keep the schools open despite the strike. Cleveland students, backing their teachers, revealed these “security” people were bringing sleeping cots into the schools for the showdown. One student testified the guards had automatic weapons.

White heated up the situation with a talk at the City Club. In this speech, he labeled the teachers lunatics, telling the audience, “The inmates (teachers) will be running the asylum.”

Then he made the absurd charge that teachers were driving Lexuses, Cadillacs and BMWs. “That is why when you go into the basement of the Cleveland School (administration) building you see all these Lexuses and all these Cadillacs, all these Ranger Rovers and these Mercedes Benzes. If I made that kind of money I’d buy one, too,” the mayor said. He was way off base. (White’s $98,336 salary was actually double that of the average teacher and his Crown Victoria was taxpayer provided.)

Rich teachers? No, a badly mistaken mayor. He had assumed vehicles in the school administration basement parking facility belonged to teachers. They actually belonged to school administrators and visitors.

Attila the Hun was on the warpath.

TEACHERS STRIKE BACK

With corporate help, White ran ads in The Plain Dealer charging teachers with working only 4.5 hours a day. “That’s like saying football players only work two hours a week,” a union leader retorted.

The Teachers eventually settled for a three-year contract with a 3 percent raise in the third year. Not exactly a greedy bunch.

But the bitterness wasn’t settled. Mayor White has angered and alienated the teachers and their activist union.

Teachers had watched White help to give property tax exemptions to the baseball stadium, the basketball arena and the football stadium. They knew it was mostly school money White gave away. Millions and millions of school dollars. The drain continues today.

So the teachers struck back. They picketed Jacobs Field with banners saying, “Children First, Stadiums Second.” They also marched at Key Center where Dick Jacobs had gotten a tax abatement of some $120 million over 20 years.

The union, however, was out-maneuvered by White and Council President Jay Westbrook. The union believed it had qualified for a November vote. Council instead moved quickly to force a vote in August. Teachers, on recess for the summer, weren’t ready for a quick, tough campaign.

That was only the start of the war by politicians and the news media against the teacher and an abatement cutback.

PLAIN DEALER DEALS FROM BOTTOM

The Plain Dealer, of course, lined up with White. Brent Larkin, the PD’s editorial boss, led the PD’s scare attack, writing, “If (Rich) DeColibus (union president) wins we’re talking about moderate-to-low skilled Clevelanders who will not have jobs and whose children will suffer.” Even though it was White who was draining revenue from the schools.

White was only beginning. He used the full raw power of City Hall to distort the issue and frighten voters.

I wrote at the time of White’s tactics: “We saw it when Mayor Mike White used the power of the city to do whatever the hell he wanted in opposing the tax abatement issue. Public money, public facilities, city employees. It didn’t matter. Ministers on the foundation payrolls crying the corporate line. A newspaper (PD) with the integrity of mafia don showing its colors, attacking state representative Dan Brady but allowing White’s continuing use of public employees and funds for his personal political (aims) to go without editorial comment during the campaign.

HELP IN RIGGING THE SYSTEM

“Community groups which receive hundreds of thousands of dollars, even million of tax dollars, danced to the Mayor’s puppet tune. Mark McDermott, director of the Cleveland Housing Network, appeared with White to campaign against the tax abatement initiative by claiming it hurt poor people. The Cleveland Neighborhood Development Corp., afloat on federal dollars, ran a full page ad featuring White and Westbrook, the two key people who run on much of what CNDC gets.

“McDermott, who is in the business of helping low income people with housing, had to be thinking about the fact that his organization gets $2.9 million via City Hall. And that his 16 housing corporations in the network get tens of thousands of dollars more from City Hall. The organizations eventually voted to support White’s campaigning.

“The ties that bind community groups to City Hall via federal funds are tight and demanding.”

FOUNDATIONS LINE UP, TOO

I went on: “The power to spread tens of millions of dollars each year combined with the extortionist buy-off capacity of Cleveland’s powerful foundations, particularly the Cleveland and Gund foundations, and Cleveland Tomorrow (now Greater Cleveland Partnership) – the corporate powerhouse – combined with the corruptive complicity of the Pee Dee and, of course,… makes a mayor like White powerful and dictatorial.”

White always played that role well.

The distortion of the teacher union’s attempt to reign in abatements reveals how the private and public sectors – greedy business people and their puppet politicians – work together against the common good.

The fact is that the abatement issue would not have ended tax abatement.

As I wrote in the Free Times at that time:

“Some truth: Issue One does not outlaw tax abatement. The mayor can give a truly needed business any amount of abatement he wishes. However, he must, if it passes, reimburse the schools for lost revenue.” (In addition, single and double-family homes were exempted from the proposed law.)

It was that simple. Just repay the schools for what revenue you give away.

Politicians allied with business, foundations and the news media can easily distort the truth and confuse voters.

And it’s so easy to give away someone else’s money. That’s what the city was doing and continues by giving tax abatements with most of the revenue coming from the school budget in Cleveland.

REAL PROBLEM: IT DIDN’T WORK

Since the city gave Dick Jacobs 100 percent tax abatement at Key Center in 1989 – 20 years ago – only one other office building has been constructed in downtown Cleveland and that building took the Hollenden Hotel when it was built.

Further, the new abated office structure has helped suck tenants from other Class A buildings, leaving them economically damaged and seeking reductions in their values. Thus more lost tax revenue.

This devaluation showed as building owners cried that economics demanded that their buildings get tax reduction as they lost tenants and business.

During this period Tower City’s complex had the value of its properties reduced by some $300 million. The BP Building, kitty corner from Key Center on Public Square, had a reduction in taxable value of $88.5 million. Even Dick Jacobs’s Galleria took a devaluation that cost Cleveland schools nearly $5 million. And irony of ironies, the Plain Dealer sought a 25 percent reduction in the value of its new $200-million plant in Brooklyn.

What do we have as a result of this moving the chairs on our downtown deck? We have a decayed downtown. A major but long empty bank building that the Cuyahoga County bought from the same Dick Jacobs – who also, by the way, cashed in by selling the abated Key Center – and the County doesn’t know what to do with across the street, a declining Huntington Bank building, along with others in what was Cleveland’s banking corner at E. 9th & Euclid.

And we have more and more downtown office buildings – which housed people who worked and paid taxes – being converted into condos. How? With new tax abatements, that’s how.

If tax abatement policy worked, please somebody show us how.

In the meantime, the unemployed and those losing their homes trying to maintain families today MUST pay their full property taxes. No excuses, please.

And so it still goes. With the emphasis on goes.

It is time to stop all abatements nationwide and have a level playing field with the Sanctified Market determining economic development and particularly office building construction.