Are Federal Workers Overpaid? (II)

About a year ago I wrote a post about whether federal employees are overpaid. It’s a never-ending debate — and now the Congressional Budget Office has weighed in.

The CBO conducted a study that compared the wages, benefits, and overall compensation of federal employees and private-sector employees who shared certain comparable observable characteristics.  The study noted, of course, that certain important qualities that can have a significant impact on compensation — such as effort and motivation — can’t really be compared.  So, the study focused on objective, measurable factors, like educational levels, years of experience, occupation, geographic location, and demographic characteristics.

The study found that federal workers with just a high school level of education make considerably more than their private-sector counterparts — 36 percent higher in total compensation.  Federal employees with a bachelor’s degree also made materially more, receiving 15 percent higher total compensation.  Only when education levels reached graduate degrees and doctorates did private-sector employees earn more than federal workers, pulling in 18 percent more in total compensation.  Overall, federal workers earned 16 percent more than comparable private-sector workers.

The CBO study probably isn’t the last word on this topic — but it does provide significant ammunition for those who think government workers often are overpaid, and that we should look long and hard at the federal government payroll as a potential target for federal spending cuts.

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A Brief Response

We’ve had some good back-and-forth discussions on the blog lately about political issues, from UJ and some commenters, including my friend Doug.  I like a good, civil discussion as much as the next person; in fact, I wish we had more discussion in this country, not less.  That is why I think the internet and blogs are such terrific developments.  We’d all be better served if more Americans aired their views and respectfully noted their disagreements.

I don’t know where the fellow UJ identified got his information about what Republicans would do if they achieve a majority in Congress.  I certainly don’t support the impeachment of the President and haven’t heard anyone talking about that topic.  I can’t think what he has done that would justify impeachment.  The fact that I (and others) disagree with his approach to the federal budget obviously isn’t an impeachable offense.  I also don’t think anyone is eager to shut down the federal government.  That said, however, I do think there are many people, including Republicans, who think we would be better served by significantly cutting spending and repealing the “health care reform” legislation that was enacted earlier this year.

In my view, the biggest issue we face is our federal debt.  Today the Congressional Budget Office released an interesting and very troubling report about the level of our debt and the likely effects of the debt if we don’t do something about it — now.  I expect that we all agree that something needs to be done about the deficit and the federal debt.  The question is, what?

The CBO report outlines the two obvious options — raise revenues, decrease spending, or some combination of the two.  I have no objection to raising revenue as part of the solution, but I think that personal and corporate income taxes are high enough already.  The top brackets already pay about one-third of their income as federal income taxes; they also pay federal Social Security taxes, state income taxes, property taxes, local income taxes, sales taxes, and other taxes on top of that.  Is it really fair to ask the small business owners and high wage earners to pay even more?

So, how can you raise revenue?  I think user fees are one option; where the federal government provides a service — be it clearing and patrolling inland waterways, operating national parks, insuring bank accounts, or any one of countless other services — it is not unfair to ask the people who benefit specifically from that service to pay for it.  I would be in favor of increasing user fees to better cover the cost of providing those services.  I also think that the federal government needs to do a better job of charging for its assets.  When the rights to use broadband frequencies are sold, for example, let’s make sure that we get the fair market price.  I don’t expect such actions to solve the budget problems, but I do think that every little bit helps.

I think it is obvious that cutting spending is going to have to be the principal means of achieving fiscal discipline.  I previously wrote about the budget for NHTSA and how I thought it could be cut.  It is all a matter of making tough choices in view of our current predicament.  Should the federal government really be funding seat belt awareness and drunk driving prevention programs at this time when spending discipline is so desperately needed?  I’m sure that there are many other small agencies and federal programs that could be cut, too — and that includes programs in the Defense Department.  No federal spending should be off-limits. 

One significant objection I have to the Obama Administration is that it has tried to talk about the need to restrain spending and be more fiscally prudent but has done nothing to pursue that goal.  When I decide how to vote in November, and in 2012, one of the key decision points for me will be to choose the candidate who I think will be most willing to make the hard choices.  I don’t care whether they are Republican, Democrat, or something else — it is time to elect people who will roll up their sleeves and tackle the issue of our government spending.