Obama to Seek Cap on Federal Pay Raises
USA Today reports that President Obama is seeking a cap on federal pay raises:
President Obama urged Congress Monday to limit cost-of-living pay raises to 2% for 1.3 million federal employees in 2010, extending an income squeeze that has hit private workers and threatens Social Security recipients and even 401(k) investors.
…The president’s action comes when consumer prices have fallen 2.1% in the 12 months ending in July, because of a massive drop in energy prices. The recession has taken an even tougher toll on private-sector wages, which rose only 1.5% for the year ended in June — the lowest increase since the government started keeping track in 1980. Private-sector workers also have been subject to widespread layoffs and furloughs.
Last week, economist Chris Edwards discussed data from the Bureau of Economic research that revealed the large gap between the average pay of federal employees and private workers. His call to freeze federal pay “for a year or two” received attention and criticism, (FedSmith, GovExec, Federal Times, Matt Yglesias, Conor Clarke) to which he has responded.
As explained on CNN earlier this year, the pay gap between federal and private workers has been widening for some time now:
Filed under: Government and Politics; Tax and Budget Policy
Those Who “Serve” Us Celebrate
Those who think that the college-educated, or soon to be so, should have more and more of their education funded by taxpayers – whether those taxpayers themselves attended college or not – are shooting off the fireworks a bit early this year, celebrating increasingly generous federal aid going into effect today.
Perhaps the most galling part of all the increasingly free-flowing aid is how much is being targeted at people who work in “public service.” Ignoring for the moment that the people who make our computers, run our grocery stores, play professional baseball, and on and on are all providing the public with things it wants and needs, to make policy on the assumption that people in predominantly government jobs are somehow selflessly sacrificing for the common good is to blatantly disregard reality.
Consider teachers, as I have done in-depth. According to 2007 Bureau of Labor Statistics data, adjusted to reflect actual time worked, teachers earn more on an hourly basis than accountants, registered nurses, and insurance underwriters. Elementary school teachers – the lowest paid among elementary, middle, and high school educators – made an average of $35.49 an hour, versus $32.91 for accountants and auditors, $32.54 for RNs, and $31.31 for insurance underwriters.
So much for the notion that teachers get paid in nothing but children’s smiles and whatever pittance a cruel public begrudgingly permits them.
How about government employees?
Chris Edwards has done yeoman’s work pointing out how well compensated federal bureaucrats are, noting that in 2007 the average annual wage of a federal civilian employee was $77,143, versus $48,035 for the average private sector worker. And when benefits were factored in, federal employee compensation was twice as large as private sector. But don’t just take Chris’s word and data to see that federal employment is far from self-sacrificial – take the Washington Post’s “Jobs” section!
And it’s not just federal employees or teachers who are making some pretty pennies serving John Q. Public. As a recent Forbes article revealed, it’s people at all levels of government, from firefighters to municipal clerks:
In public-sector America things just get better and better. The common presumption is that public servants forgo high wages in exchange for safe jobs and benefits. The reality is they get all three. State and local government workers get paid an average of $25.30 an hour, which is 33% higher than the private sector’s $19, according to Bureau of Labor Statistics data. Throw in pensions and other benefits and the gap widens to 42%.
Recently, my wife and I have been watching the HBO miniseries John Adams, and I couldn’t help but make the observation: In Adams’ time, many of those who served the public truly did so at great expense to themselves, often risking their very lives and asking little, if anything, from the public in return. Today, in contrast, many if not most of those who supposedly serve the public do so at no risk to themselves – indeed, unparalleled security is one of the great benefits of their employment – but are treated as if their jobs are extraordinary sacrifices. And so, as we head into Independence Day, it seems the World has once again been turned upside down: In modern America, the public works mightily to serve its servants, not the other way around.
Filed under: Education and Child Policy; Tax and Budget Policy
Uncle Sam a Generous Boss
Federal unions, government officials, and the Washington Post’s “Federal Diary” column frequently suggest that federal civilian workers are underpaid. They suffer from a large “pay gap” compared to private sector workers, or so the story goes.
But in the Post’s “Jobs” section yesterday, human resources specialist Lily Garcia argues that “Uncle Sam Is a Boss You Can Rely On.” For job seekers, Garcia points to the many advantages of federal work:
- “Generous benefits, solid pay, and relative job security — a combination that is challenging to find in the private sector, even in the best of times.”
- The “widest selection of health-care plans of any U.S. employer.”
- “Liberal amounts of paid time off.”
- Very lucrative retirement benefits.
- Family-friendly policies such as “first priority and subsidies at a number of top-notch day-care facilities.”
- “Federal employees are paid relatively well . . . [and] practically guaranteed periodic within-grade pay raises.”
- Finally, “federal employees cannot be unceremoniously fired.” I’ve found that only about 1 in 5,000 federal civilian workers are fired each year due to poor performance.
Is the lack of firing a result of the superb quality of the federal workforce and superior management practices? Hardly. Garcia notes that the downside of working for Uncle Sam is that the government “has its fair share of bullies, sycophants and incompetents who pick on employees, display favoritism, mismanage operations and find creative ways to manipulate the rules to their advantage.” I’d guess more than its fair share. Since federal workers are rarely fired, the ranks of non-performing managers and workers grows over time, contributing to the bureaucratic ineptitude we are all familiar with in the federal government.
To improve workforce efficiency, I’ve suggested privatizing as many federal activities as possible, include postal services, air traffic control, and passenger rail. To cut costs, I’ve suggested a federal wage freeze and a cut in federal benefits as part of a plan to reduce federal budget deficits.
For more from Lily Garcia, see here. For more from me, see here.
Selflessly Giving…to Themselves
I wasn’t going to write about this because it is purely anecdotal, but Chris Edwards’ post on the generous compensation of federal employees, and the constant denial of that generosity by those employees’ representatives, inspired me to ingore my reservations.
A couple of days ago, I was driving through the streets of D.C. and ended up behind what appeared to be a new, black Jaguar. Now, trailing a Jag wasn’t all that extraordinary — D.C. is home to a lot of fancy cars. What was extraordinary was the wholly inconsistent declaration printed on the frame of the status symbol’s license plate: “Proud to be a social worker.”
It seemed wholly inconsistent, I should say, except, again, fancy automobiles are common on the streets of D.C., even though the District is supposed to be a city populated with “public servants.” So this public-serving D.C. driver was perhaps out of the ordinary for his implied candor, but is no doubt far from alone in serving himself at least as much as he’s serving others.
Of course, systemic evidence like Chris presents on federal workers, or I present on teacher compensation, indicates much more conclusively than my automotive observations that public-service-as-a-synonym-for-sacrifice is largely a political myth, a narrative repeated by public employees to win your sympathy while they grab for your wallet. Which is not to say that social workers, teachers, federal bureaucrats, etc., aren’t motivated to help others – no doubt many are – but like all of us, they’re also highly motivated to help themselves. And since their compensation comes through politics, it is making the public believe that they live tough, self-sacrificial lives that is, ironically, the key to their living the Good Life.
Filed under: Education and Child Policy; Tax and Budget Policy
Congressional Priorities and the FY2010 Budget Resolution
Yesterday the House and Senate passed a bloated $3.5 trillion budget blueprint for fiscal year 2010. According to House Speaker Nancy Pelosi (D-CA), “What is important to us as a nation is reflected in this budget. It’s a very happy day for our country.”
Included in the blueprint is language that calls for an equal pay raise between military employees and civilian federal employees. President Obama had originally proposed slightly higher pay for members of the armed services. The exact pay raise for bureaucrats will be determined in the appropriations process, but it’s likely to be a hike of anywhere from 2.9% to 3.9%. This would come on top of last year’s 3.9% raise.
Omitted from the blueprint was language included in the Senate version by Sen. Tom Coburn (R-OK) that would have “required agency managers to report to Congress within 90 days of the bill’s passage on any programs that are ‘duplicative, inefficient or failing, with recommendations for eliminating and consolidating these programs.’” A simple report to be issued by the agencies themselves. That’s it. There would be no guarantee that anything would actually be cut or consolidated.
Is it really a happy day for our country when Congress passes a blueprint to add another $1 trillion plus to the skyrocketing national debt? Is it really good for the struggling economy that the parasitic bureaucrats already living comfortably at the expense of the productive members of society are going to get another fat pay raise? Is it really “important to us as a nation” to make sure federal agencies are not instructed to pick out the particularly woeful programs under their watch?
It may be a happy day for politicians and bureaucrats, but it’s another kick in the teeth for taxpayers.
Congressional Bonuses
The Wall Street Journal reports,
While Congress has been flaying companies for giving out bonuses while on the government dole, lawmakers have a longstanding tradition of rewarding their own employees with extra cash — also courtesy of taxpayers.
And at the very time that Congress was mishandling the financial crisis and trying to direct popular outrage at Wall Street, not Washington, the bonuses were getting bigger:
Capitol Hill bonuses in 2008 were among the highest in years, according to LegiStorm, an organization that tracks payroll data. The average House aide earned 17% more in the fourth quarter of the year, when the bonuses were paid, than in previous quarters, according to the data.
LegiStorm is a pretty scary website for congressional staff members and privacy advocates. It makes readily available not just staffers’ salaries but their financial disclosure forms, including their spouses’ sources of income, as the Washington Post reported this week. I used LegiStorm myself (or technically interns Schuyler Daum and Jonathan Slemrod did) to write about how the Republicans shoveled bonus money to their staff members before they lost control of committee budgets after the 2006 election. Now that bonuses have become a focus of outrage, maybe Congress should impose 90 percent clawbacks on the bonuses of congressional staffers — and bonuses to other federal employees. After all, they’ve mismanaged the government’s finances far worse than AIG employees mismanaged that company.
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