To fully appreciate the herculean task required to get our fiscal house in order, consider this; the recently brokered deal to extend the payroll tax holiday is partially offset by raising by 0.8% the amount federal workers contribute to their pensions. The union reaction?
“Working class men and women who have dedicated their lives to serve their country should not be on the hook for solving a crisis they did not create,” American Federation of Government Employees National President John Gage said.
Continuing to attack federal employees’ pay and benefits doesn’t create new jobs and only adds to the pain and suffering many working class men and women are experiencing,” Gage said.
And, no, I didn’t get that decimal point wrong. It really is a 0.8% increase. So, if, say, a federal worker is currently contributing $100 towards their pension in any given period, they will now have to kick in an extra 80 cents. This is an “attack” on “working men and women”?
Amazingly, this near-rounding-error of an increase is expected to “save” $15 billion over the next year or so. That’s real money. Increasing federal workers’ pension contributions by a modest 10% could, it would seem, generate close to $200 billion in savings.
So, why aren’t we hearing more about these kind of budget savings?
The short answer, of course, is that we’ve allowed the creation of a union-government industrial complex. Federal, state and local governments are stacked with a permanent taxpayer-funded lobby for expanding government and fighting efforts to curtail government spending.
FDR even warned about such a development as he stated his opposition to collective bargaining for government employees:
All Government employees should realize that the process of collective bargaining, as usually understood, cannot be transplanted into the public service. It has its distinct and insurmountable limitations when applied to public personnel management. The very nature and purposes of Government make it impossible for administrative officials to represent fully or to bind the employer in mutual discussions with Government employee organizations.
Over the past few decades, we’ve forgotten FDR’s warning and allowed politicians to shower unionized employees with outsized paychecks and platinum-level health and pension benefits. In exchange, the politicians are rewarded with campaign contributions and votes at election time. The problem is particularly acute at the state and local level, where governments are creaking under heavy health and pensions burden for current and retired employees. Many of our budget challenges are difficult, but reforming government workers’ compensation and benefits isn’t one of them.
Sure, the unions will scream, protest and stamp their feet. (See, for example, Wisconsin, Ohio and Indiana.) But, if even a 0.8% increase elicits an outcry as an “attack” on “working men and women”, then there really isn’t any prospect of reaching any kind of compromise. Best to just set that notion aside and move forward and free the 95% from the outrageous demands of government employees.