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Pay no attention to the people behind the curtain

Tuesday, June 06, 2006

McIlheran Watch: Republicans want to steal my deferred compensation

I like it when Patrick McIlheran blogs a lot, as it gives me so much more material. If I get time, you'll see another one yet tonight.

As prelude, consider this: I am a public school teacher. That means that, depending on your perspective, I am either woefully underpaid or I have Cadillac fringe benefits that I don't deserve.

Actually, both of those are accurate.

Thing is, I consider myself to be just like Dick Cheney. See, Cheney once worked for a tiny little outfit called Halliburton, and during his time there, he negotiated a compensation package that not only paid him handsomely while there, but continues to pay him to this day. It's a good deal for both Halliburton (tax incentives and whatnot) and Cheney, who is now able to enjoy his retirement without concern for his future financial needs.

But, Jay, you may be asking, how is that like you at all? Simple: As a public school teacher, I, too, have chosen a package that includes deferred compensation. In fact, most public employees have.

We just don't call it that.

Here's McIlheran, complaining about Milwaukee County:
As [County Executive (and Big Brother) Scott Walker] has pointed out earlier, after it makes its payroll, the county has another huge bill, another 70% or so added on, to cover benefits. That rate, he says, is “Staggering. Nationally, the private sector is under 30% and state and local governments are under 33%.”

The Journal Sentinel’s Avrum Lank and Dave Umhoeffer covered this in detail. Read it if you haven’t; it says exactly what has gone wrong that we don’t have money to keep up parks or bus lines. The reason is that we’re paying, still, for work done long ago [. . .]. The reason the county is having the raise bus fares and talk about cutting service is because it is paying people splendid benefits not merely to drive buses — but to have driven buses once upon a time.
One of the nice things about living in a capitalist society is the ability of workers to organize and bargain for a compensation package that suits them best (management also gets a stake; that's why they call it bargaining). Public employee unions long ago figured out that demanding high salaries was pointless--and too expensive for employers concerned with the other costs of maintaining government services--and so they opted for something besides salary: namely, benefits, including retirement benefits like pensions and health care.

This is not significantly different from unions in other sectors did, sure. Other sectors, though, have been able to maintain salary increases at a much better pace than public unions have.

As the costs of (retirement and non-) health care and pensions increased, unions traded a maintenence of those benefits for potential salary increases. Teachers like me, for example, have seen wage increases below inflation (.pdf) and, even when not below inflation, below the increases seen in other sectors (a fact acknowledged even by the anti-union WPRI in this .pdf report). Teachers in Wisconsin have not just fallen in salary compared to other workers, but also to teachers in other states: Fifteen years ago, we were in the top third; now we're in the bottom half. This is again due to our being willing to take lower salary in exchange for benefits in the Midwest's most expensive state for health care. Bus drivers, too, apparently aren't raking it in, either.

But the non-retiree benefits aren't the subject of this post, or of McIlheran's rant (it does, indeed, take one to know one). The subject is the pay that I'm not getting now that I expect to receive when I retire--in the form of a pension and health benefis. What I want to know is, why is my deferred compensation--which I bargained for and agreed to lower current wages in exchange for--different from Dick Cheney's--which he bargained for and agreed to take lower salary in exchange for?

Republicans bristle at the suggestion that Cheney should give up the money he's getting from Halliburton, especially now that we're at war and Halliburton is getting mucho contracto federales (I know, I've sugested it at Republican blogs before). But Republicans like McIlheran--and, to pick just one more example, Brian Fraley--have no compunction at suggesting that public employees surrender their deferred compensation.

But, I can hear them objecting, Cheney's not being paid his deferred compensation by taxpayers! Oh, really? How many billions in contracts is Halliburton getting from the feds this year?

I'll pony up here and admit that I'm at least somewhat facetious. But I do regularly wonder why those who extol the virtues of the free market complain about those of us who have used market principles and a technique--deferred compensation--that doesn't even merit a raised eyebrow in the private sector.

I'm not saying that the public sector isn't headed for trouble when deferred compensation starts coming due. And, as usual, I could recommend some fixes, like a national health-care policy that brings per capita health care costs down significantly. (The Republican agenda, sadly, is not even close.) I can't fix everything from here at my laptop. All I can do is speak up when spoken about.

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