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November 29, 2010

Obama Announces Federal Pay Freeze

By Ed Lasky
Stop the presses! Barack Obama just announced a freeze on federal civilian salaries. From the Washington Post:
The freeze applies to all Executive Branch workers -- including civilian employees of the Defense Department, but does not apply to military personnel, government contractors, postal workers, members of Congress, Congressional staffers, or federal court judges and workers.

"Getting this deficit under control is going to require some broad sacrifices and that sacrifice must be shared by the employees of the federal government," Obama said in a speech Monday afternoon explaining the decision. He added, "I did not reach this decision easily, this is not a line item on a federal ledger, these are people's lives."

The freeze would take effect on Jan. 1, pending Congressional approval by the end of this year. The 2012 pay freeze will be proposed as part of fiscal 2012 budget proposals to be unveiled early next year.

The pay change will not impact bonuses for federal workers or when a federal worker is promoted to a new level of pay, meaning federal workers promoted in the next two years will receive a new level of pay, but not receive any additional annual raises.

The decision will save the government about $2 billion for the remainder of fiscal year 2011 and $28 billion over the next five years, the White House said. The long-term savings come from lowering the government's base compensation over the next two years.

Well...exactly, Mr. President.

No wonder you and Michelle have advocated public service to college graduates -- it's a sweet deal to have someone pay a huge salary to you (with lots of benefits and vacation days) without really having to perform (see below). Obama knows from what he speaks because he can be the poster child for overpaid government workers.

When a previous president, John F. Kennedy, issued an executive order that allowed federal workers to unionize, he created a problem that has played a role in creating the budget and debt problems we have now. Federal workers, in fact, earn far more than their private-enterprise counterparts.

But the problem has metastasized under Barack Obama because he has created 141,000 new federal jobs since he took office (meanwhile the rest of the nation has lost millions of jobs) and has been busy raising salaries with all the alacrity of Santa Claus on Christmas Day.

Fortunately, we have a few big media outlets that have alerted the public to the problem (Fox News, Wall Street Journal -- but even liberal outlets such as the Boston Globe have noted the problem), and the Tea Party movement has focused on the deficit and debt disasters generally while also addressing the issue of government pay.

But Obama and the Democrats have resisted dealing with the problem because federal pay is really federal payola. Government worker unions have become a dominant campaign donor to Democrats over the years. Government workers are the dominant special interest group aligned with the Democrat party. Their paychecks come from us but are signed by our politicians.

Republicans have been at the forefront of advocating a freeze on federal salaries. They have focused like a laser beam on the problem. Jason Chaffetz, a young and promising Republican congressman from Utah, has been advocating not just a freeze on federal salaries, but also the firing of any federal employees who are deadbeats as taxpayers.

Brian Riedl wrote of the 12-step program needed to get the government off the spending addiction; the number-one recommendation was to freeze and reform federal pay and take related steps:

One. Freeze and reform federal pay. Before Washington asks Americans to tighten their belts, it must tighten its own. While some federal employees are undercompensated, the average federal employee receives 30 to 40 percent more in total compensation than the equivalent private-sector worker; all this extra pay adds up to $47 billion. Lawmakers should freeze federal pay until it can be fundamentally reformed.
Enter text here.
Similarly, Congress should cut its own budget and salaries to 2008 levels, pare back the surging federal travel budget (not every federal conference has to be in Maui), suspend acquisition of federal office space, competitively outsource more federal work, and require federal employees to fly coach domestically.

His column is worth reading in its entirety.

Republican Congressman Darrell Issa -- soon to take over the chair of the House Committee on Oversight and Government Reform -- wrote a superb column regarding the issue in the National Review. He concentrated on the need to limit the growth in federal hiring, but the goal is the same -- save money (with the added bonus of highlighting the Republican agenda of restraining the growth of the government Leviathan -- since that is really the best way to cut our federal spending).

Not even the recession has slowed this trend. Unemployment remains dangerously high, and the number of poor is at its highest level since 1959. But as the private sector has lost 7.7 million jobs since December 2007, the federal government has added 212,100 jobs.

Unlike the private sector, the federal government is largely unaffected by competition or market forces. One might think that therefore, the government would use the private sector as a benchmark when it decided how much to pay its employees. Yet in 2009, federal employees' average pay and benefits totaled $111,725, while private-sector employees earned an average of $61,051. Even when one looks at workers in comparable occupations, the federal government pays an average of 20 percent more than the private sector.

And the federal workforce continues to pad its pockets with taxpayer dollars. President Obama asked for a 1.4 percent pay increase for the federal workforce (with the exception of political appointees) in 2011. If the federal government froze salaries at the 2010 level, it would save American taxpayers $2.2 billion next year alone.

Are the spiking salaries due to excellent performance? According to the federal government, yes. Shockingly, of the 2.1 million federal workers, only 177 received unsatisfactory ratings on their 2009 evaluations. Of those employees, 150 still received an automatic pay raise.

That's why House Republicans have proposed a net-hiring freeze on non-security federal employees. The "Pledge to America," released last month by Republican leader John Boehner, lays out numerous policy goals that promise to keep the federal workforce from growing and put America back on track for private-sector job creation.

The government exists to serve the American people, but Americans are now forced to pay for a bloated, inefficient federal workforce that is too often rewarded with pay raises and job security for unacceptable job performance.

Issa points out the hypocrisy of Obama's volte face. The crisis has been brewing for years and has been clear to most of us since 2008. Regardless, Obama proposed an actual increase in federal pay a short time ago. But that was before the shellacking. Now Obama faces a Republican House jazzed to put on the green eye-shades and start trying to save  taxpayer money. Obama is merely trying to get ahead of the parade -- always the goal of a politician.

Obama is a poker player, and seemingly a bad one -- his hand was forced. He is worried about not taxpayers or our nation's fiscal health and future, but his own political future.

Republican leaders should graciously welcome Obama's conversion on the road to 2012 but also make a point, repeatedly, that these moves were long advocated by Republicans and that it is nice to see Barack Obama waking up to reality.

Of course, Barack Obama's announcement regarding the freeze was accompanied by the obligatory blaming of the problem on George Bush, stating that the problem was because of the "irresponsibility of the past decade." Nancy Pelosi and the Democrats who controlled the House for six years rate no mention.

But if Obama actually wanted to make a splash and change the perception Americans have of him, he could take a couple more steps to address the crisis. He could plagiarize a page from the GOP playbook (and we know he has no problem with passing off the work of others as his own) and consider freezing or reducing the size of the government workforce. His spokesman has declined to consider this option -- for now, anyway .

But Obama could take a defining step that would send a political shock wave across the nation.

He could reverse the executive order that Kennedy issued and disallow the unionizing of federal employees. Governors -- such as Mitch Daniels of Indiana -- have issued executive orders disallowing government worker unions and have seen their economies respond positively, not to mention had their images of leadership burnished. Ronald Reagan very early in his presidency took on the fearsome Professional Air Traffic Controllers Organization, who went on strike despite a law that forbade striking. Planes did not fall from the sky, and air traffic resumed at normal levels as a new, non-unionized work force was trained to man our airports. The boon to Reagan was immediate: his image as a leader took hold and endured. Americans love a fighter who fights for them (hasn't Chris Christie become a superstar for also taking on government workers?). Foreign nations came to respect Reagan as a man of strength, a man of his word who fulfilled his promises.

With the rest of the world viewing Barack Obama as feckless and weak, maybe Obama can actually restore some respect to the office of the presidency by revoking John Kennedy's executive order.

And if you think that will ever happen, I have some swampland in Florida to peddle to you.
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