Pay soars in the public sector

Oct. 21, 2012

By Steven Greenhut

STOCKTON — Workers for the city of Stockton who attended the unveiling Wednesday night of a new report detailing trends in public-employee compensation in California complained about cuts in their compensation packages that are causing hardship for them and their city.

But the report, prepared on behalf of the Howard Jarvis Taxpayers Foundation and released at a meeting of the San Joaquin County Taxpayers Association, left me searching for the world’s smallest violin — that metaphorical instrument I play whenever my kids, or anyone else, starts whining about something that’s largely their own fault.

Stockton is bankrupt, following more than a decade of Bacchanalian feasting on taxpayer dollars, including a lifetime medical benefit bestowed on city employees and a most-generous “3 percent at 50” pension plan for its highly paid public safety workers.

The city burned through its pension-obligation bonds — the equivalent of a family taking out a loan to pay the mortgage — and is now trying to stiff its bondholders in bankruptcy. There was no obvious complaint by city unions or employees during the tax feast, but now that they are facing “cuts” — some real, but others that are merely rollbacks in expected raises and limits on special-pay gimmicks — they and their members are playing the victims.

But the numbers tell the story.

Consider this nugget from the blandly titled study, “California State Employee Compensation Trends,” prepared by Steven B. Frates of the Center for Government Analysis: “Total expenditures by the state government of California to finance salaries and pension benefits for state government employees increased almost three times as fast (29 percent) as the per capital personal income of all Californians (9.8 percent) from 2005-10.”

As Frates put it, in plain English: “They [public employees] were getting richer three times faster than the general population.”

Tax increase

Californians are stuck watching those dreadful union-financed campaign TV ads supporting Proposition 30, which would push our highest income-tax rates to the stratosphere and boost sales taxes. The main rationale for high taxes, we’re told, is that California is slashing public school funding and laying off teachers.

But if the raises and benefit boosts granted the state’s public employees from 2005-10 had been merely at the 9.8 percent rate of income growth experienced by the rest of us, the state government would have saved $2.1 billion in 2010 alone — enough to pay for nearly 25,000 new teachers, more than the number that have been laid off.

We’ve heard Gov. Jerry Brown and the Legislature’s Democratic majority bemoan draconian cuts in government. But even in the thick of the financial mess, state government has been hiring. The number of state government employees increased 5 percent during 2005-10, which is slightly higher than the job-growth rate in the general population.

State Sen. Mimi Walters, R-Laguna Niguel, kicked off Wednesday’s program with an under-the-Capitol-dome look at the state’s efforts at pension reform.

She confirmed what this column and others have been saying. The governor announced a 12-point pension-reform plan in 2011 but did nothing to promote it. After Republicans offered legislation advancing the Democratic governor’s pension reforms, the governor’s fellow party members refused to give it a hearing.

On the last day of session, the Democrats cobbled together something that Walters calls “pension change” rather than “pension reform” given that it does little, mostly applies to future workers and is not a constitutional change — meaning that future legislators can easily kill these modest changes. It does nothing about the unfunded health care promises of the sort that sent Stockton into the poorhouse.

The state’s leaders view pension reform as public relations to convince Californians that they are “doing something” so that voters are more willing to approve yet another tax hike.

Pension problem

But the compensation report showcases the reality of the pension problem. During 2005-10, the growth in pension expenses soared 45 percent for all categories of state government employees. The cost of pensions for public-safety workers increased 94 percent. Figures for employees of local governments no doubt are similar to this state data.

The state data is two years old, so the situation surely has worsened, but the California Public Employees’ Retirement System likes to stonewall and delay. As the report noted, “CalPERS’ tardiness in posting relevant data in a timely manner is unseemly in an open democratic society.”

Everything about this pension mess is unseemly, indeed.

Those of us who oppose tax increases know how the government spends money. This data on pay and pensions for public employees reveals, as Frates said, that the government’s priority has not been providing better services, but boosting salary and benefits for those who work for government.

What will happen if California voters approve Prop. 30? Check out the many bills that moved through the Legislature this session, as legislators crafted new proposed programs and benefit increases for their public-employee constituents.

Before the Wednesday presentation, I gave Frates a tour of central Stockton. We drove by the impressive port, on the edge of the Sacramento Delta, past the Ivy League-reminiscent campus of the University of the Pacific, through the leafy old neighborhoods near Victory Park, and around the mostly vacant downtown, with its restored Fox Theater and historic buildings. It’s a beautiful old city, but Frates noted the decrepit situation: pothole-pocked streets, litter, old shopping carts, graffiti and scary characters hanging out in the parks and on street corners.

The purpose of government is to provide services to the public, not to enrich the people who work for it. The compensation report, and the conditions in the city where it was released, remind us that if elected officials focus on the latter, we get far less of the former.

Steven Greenhut is vice president of journalism at the Franklin Center for Government and Public Integrity. Write to him at: [email protected]

20 comments

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  1. Ted Steele, The Decider
    Ted Steele, The Decider 21 October, 2012, 18:01

    LOL—-Greeny—– Solution:

    Pass Prop 30, do what’s right to fix our state. And then do what our law provides for and bargain for the wages/comp you think the workers deserve. End of story. The system our democracy put in place to handle this works. Or should we abandon democracy, stop keeping our word, amend our Constitution and chant USA USA while we pretend we know what American Exceptionalism means?

    Reply this comment
  2. Ted Steele, The Decider
    Ted Steele, The Decider 21 October, 2012, 18:03

    And Greeny— Remember—you’re the guy who gave us Tony Rackakass in Orange County! You’re ideas aint so seamless little buddy !

    Reply this comment
  3. Hondo
    Hondo 21 October, 2012, 18:59

    Passing prop 30 will do nothing to solve the deficit problem. In 09 Aaaanold and the dems in Kali passed huge temp tax increases and the result? Even bigger deficits. Illinois passed huge tax increases last year and the result? More deficits this year. When your taxes are already among the highest in the country, raising them is counter productive. You stifle business and run them to lower tax states.
    So go ahead, vote to raise your taxes. See if it balances your deficit.

    Reply this comment
  4. Douglas
    Douglas 21 October, 2012, 19:45

    I didn’t get my Cadillac when I retired. Does this mean I won’t get my twenty virgins when I get to heaven?

    Reply this comment
  5. Bob
    Bob 21 October, 2012, 20:01

    Does this mean I won’t get my twenty virgins when I get to heaven?

    What makes you think that’s where you’re going?

    And maybe you’ll get 20 Jerry Browns and a Darrell Steinberg and a Johnny Perez.

    Reply this comment
  6. Ted Steele, The Decider
    Ted Steele, The Decider 21 October, 2012, 20:21

    Hondo— There is no question that in part you are correct—- Many more cuts need to happen——- but prop 30 gets out to a place to do it….. the alternative is no good. The revise has huge cuts coming if p 30 passes. Then I agree– we need more.

    Reply this comment
  7. Donkey
    Donkey 21 October, 2012, 21:12

    Hondo is right on, feeding the beast a new source of income will do nothing to stop the RAGWUS from stealing even more. There is no end to the greed of the public trough feeders!!! 🙂

    Reply this comment
  8. Rex the Wonder Dog!
    Rex the Wonder Dog! 21 October, 2012, 22:15

    Public safety compensation went up 97% from 2000-2010, nearly 10% per year. The fact is 30 years ago GED educated cops and FF’s made close to the median state income, today they make more than pediatricians and other medical doctors, more than CPAs and Lawyers, more than virtually all “professional” jobs that require several years of post baccalaureate study, AFTER they ave a 4 year college degree. That is the problem in a nutshell. Gov employees being compensated 10-20 times what their skill set is actually worth in the free market.

    Reply this comment
  9. Rex the Wonder Dog!
    Rex the Wonder Dog! 21 October, 2012, 22:19

    Hondo— There is no question that in part you are correct—- Many more cuts need to happen——- but prop 30 gets out to a place to do it….. the alternative is no good. The revise has huge cuts coming if p 30 passes
    ==
    Oh Teddy, how are we going to cure you of your trough feeder spin???

    ALL Clown needs to do is CUT the salary of ALL gov employees, progressively, by 10%-35%. If you’re in the $200K range you take a 35% cut, if your in the $50K-$75K range-10% cut…., $75K-150K 25% cut. Then FREEZE the pay at that level for 5 years. That is exactly what San Diego is doing, not the cuts, but freezing pensionable salary. Easy cure-Clown just doesn’t want to do the obvious and best choice.

    How did you weekend getaway with Perez go 😉 We missed you yesterday!!!

    Reply this comment
  10. Rex the Wonder Dog!
    Rex the Wonder Dog! 21 October, 2012, 22:22

    Or should we abandon democracy, stop keeping our word, amend our Constitution and chant USA USA while we pretend we know what American Exceptionalism means?
    ==
    Errrr..Teddy, you do know that there is NO constitutionally protected right to collective bargaining don’t you???? It is entirely statutory.

    I would revoke collective bargaining and just impose market wages and benefits for all troughies, which would mean a 59%-90% cut for them 😉

    Reply this comment
  11. Rex the Wonder Dog!
    Rex the Wonder Dog! 21 October, 2012, 22:26

    And maybe you’ll get 20 Jerry Browns and a Darrell Steinberg and a Johnny Perez.

    ===
    BOB!!!! Don’t ever say that again, I just threw up in my mouth 🙂

    Reply this comment
  12. Ulysses Uhaul
    Ulysses Uhaul 21 October, 2012, 23:38

    The doomers had a dark weekend…..sad…..neved happy.

    Prop 30 will pass as this is a progressive state coming out of Republican created wars and financial disasters…..Perez and Steinberg are doing the heavy lifting while the bunker boys punch in and out from their cubicle and convenience store part time jobs!

    Reply this comment
  13. Donkey
    Donkey 22 October, 2012, 07:01

    Rex, you are on the right track with the cuts in wages to the RAGWUS feeders. I have been in favor of this idea for 15 years. The cuts also need to be for benefits, pensions, and the elimination of perks of all kinds. 🙂

    Reply this comment
  14. us citizen
    us citizen 22 October, 2012, 08:12

    Cut cut cut away! Who cares. Life will go on and those of us who work to pay for the govt employees will be happy.

    Reply this comment
  15. Ulysses Uhaul
    Ulysses Uhaul 22 October, 2012, 09:59

    Yes… yes…..give and give and give…your attitude will improve…no longer a guilt ridden miserable life of greed and coveting possessions….

    Reply this comment
  16. Rex the Wonder Dog!
    Rex the Wonder Dog! 22 October, 2012, 23:28

    Prop 30 will pass as this is a progressive state …
    ==
    $100 bucks Teddy, put up or shut that trough feeding mouth 😉

    Reply this comment
  17. Ulysses Uhaul
    Ulysses Uhaul 23 October, 2012, 09:12

    Why hurt people? Greed ….greed….greed…..Prop #30 will pass….for the little people!

    Reply this comment
  18. Rex the Wonder Dog!
    Rex the Wonder Dog! 23 October, 2012, 10:03

    $100 troughie-put up or shut up Teddee….

    Reply this comment
  19. Sean Morham
    Sean Morham 23 October, 2012, 10:14

    Pass 30. No on 32. Let the pieces fall. We will have a $16 billion shorfall forecasted by 4/1/13. Let Jerry explain, after getting what he asks for.
    Then, the democrats will attempt to increase the vehicle tax, liquor taxes, etc…through the legislative process(Fiscal Emergency Taxes). Then, another ballot measure in the next term for Brown or whatever ahole is elected by the brain dead moron “citizens”.
    Nothing will change without complete chaos, and perhaps not even then.

    Reply this comment
  20. vMatt
    vMatt 5 November, 2012, 19:27

    This is great.

    Reply this comment

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