Howard Rich

A decade ago, when our national debt stood at a “mere” $5.6 trillion, the federal government was already dramatically overpaying its employees to perform all sorts of non-core functions.

According to the U.S. Bureau of Economic Analysis, compensation for the average federal position in 2000 exceeded compensation for the average private sector job by $30,415 – a sizable gap that has since exploded to $61,998. Now the average federal employee’s compensation totals $123,409 – or more than twice the average private sector salary.

Federal workers have seen their total compensation soar by 36.9 percent since 2000 – after adjusting for inflation. By comparison, private sector compensation has increased by only 8.8 percent.

Also, in spite of a recession that saw the loss of 8 million private sector jobs there are more federal employees working today – 2.15 million – than ever before.

In addition to generous salaries, health care coverage and inflation-protected pensions, public sector employees also receive more vacation time, holidays and sick days than their private sector counterparts.

Needless to say, federal workers have secured much of this largesse thanks to collective bargaining. The same can be said of public school teachers in Milwaukee, Wisconsin – where the average compensation package was recently valued at $100,005.

But public sector collective bargaining isn’t your typical collective bargaining. In fact, it represents an unnatural perversion of a failed private sector experiment – an unfair tactic that continues to be exploited to the detriment of taxpayers. In fact, only now that a line has been drawn in the sand in Wisconsin (one of dozens of states struggling to balance its budget due to the stranglehold of public sector unions) do we see the true cost to taxpayers coming into focus.

In the private sector, collective bargaining is ostensibly driven by market forces. Both workers and managers rely on profits, and so negotiations are (in theory, anyway) conducted with the goal of creating a larger pie for everyone to share. Obviously this hasn’t been the objective of union bosses, which is why the free market has largely weeded their unions out of the economy.

Currently only 7.2 percent of America’s private sector workforce is unionized – down from a World War II-era peak of 33.9 percent. This trend is reversed in the public sector, however, where unions now comprise 36.8 percent of the workforce – up from 9.8 percent in the 1940s.


Howard Rich

Howard Rich is the Chairman of Americans for Limited Government.