My last post noted that recent survey data has shown the advantage that public sector workers have over private sector employees in terms of total compensation, including salary and benefits. I also noted that part of the reason for this advantage is due to the higher proportion of graduate and professional degrees among public sector workers. The Washington Post last week published the graphs shown above that demonstrate this disparity in educational achievement, as well as the fact that public sector workers are generally older than private sector workers.
Nevertheless, the Washington Post noted that state politicians in particular are talking about this pay package disparity between public and private sector workers because many states' fiscal problems are in large part due to the burden of having to pay for public workers' benefits, especially the pensions of their retirees. The general public is also likely to become increasingly concerned about, not only the pay package disparity, but also the relative security of public jobs during a period of continuing high unemployment throughout the country.
The Post quoted several elected state officials talking about this new type of class warfare:
"We can no longer live in a society where the public employees are the haves and the taxpayers who foot the bill are the have-nots," Wisconsin's incoming Republican Gov. Scott Walker declared this month, as he raised the idea of stripping state workers there of collective bargaining rights. Outgoing Minnesota Gov. Tim Pawlenty, who is mulling a GOP presidential bid, also sounded a class-war note last week on the op-ed page of the Wall Street Journal: "Unionized public employees are making more money, receiving more generous benefits and enjoying greater job security than the working families forced to pay for it with ever-higher taxes, deficits and debt."
It is not only Republicans that are recognizing this issue. Democratic Governor-elect Andrew Cuomo in New York is preparing to face the issue in that state when he takes office next month "warning that state employee salaries and benefits are unsustainable at a time when the state has a $9 billion deficit."
The Washington Post goes on to note: "Relative job security with generous benefits that extend into retirement has long been part of the appeal of working for the government. But an eight-hour day in a drab Independence Avenue office building can look like a supremely privileged lifestyle when Americans in the private sector are panicked and furious over what has happened to their own salaries, health coverage and 401 (k)s. Add to that the growing view that the government has gotten too big and that deficits are going to swallow the economy, and you have all the makings of a backlash." http://www.washingtonpost.com/wp-dyn/content/article/2010/12/20/AR2010122005225.html?tid=wp_featuredstories
In an October editorial in Newsweek magazine, Mortimer Zuckerman stated that we are becoming "two Americas", but not the type that politicians have usually been talking about: that is the class warfare between rich and poor. Rather Zuckerman said that the division between the public sector and the private sector will define the "two Americas". He quoted from a 2009 Mayo Institute study that found "private-sector workers three times more likely to be jobless than public-sector workers", and Zuckerman notes public sector employees can thrive even in a down economy.
Zuckerman also stated that the compensation gap has been growing quickly in recent years because federal employees have been awarded bigger average pay and benefit increases for nine years in a row. As a result, he says this "is tantamount to a wealth transfer from the citizens to the people who serve in government". As I noted in my last post, even the federal pay freeze recently announced by President Obama will not stop all federal pay increases over the next two years, as his announcement may have implied.
As I have said before, the fact that there exists this pay disparity, on average, between public and private sector workers does not prove that public sector workers are overpaid because other factors such as the types of jobs, experience and educational levels must be considered. However, the fact that this issue is getting more attention by the mainstream media and state officials facing growing fiscal deficits at a time when high unemployment continues to plague the economy, while public workers are more secure in their jobs, will assure that the term "class warfare" will likely start to take on a new meaning.
Sphere: Related Content
No comments:
Post a Comment