Kevin Drum checks in with the latest from the class wars:
In the middle of a rant about healthcare reform and the compromise over the Cadillac tax, one of Andrew Sullivan’s readers says this:
The idea that public employees make less than those in the private sector is a myth that needs to die. Most already have cadillac plans and in most places their salaries are ahead of private workers whose taxes go pay for their income. On top of that they get much better benefits and pensions, so to let them out of a tax that private industry workers will have to pay who work at the same income level is a slap in the face. Our system cannot work if the government employees earn more than the private industry workers earn who are supporting them.
Kevin wonders whether this is really true:
In the upper reaches of management, it obviously isn’t. Mid-level and executive level managers often make half as much as comparable private sector managers. (Or less.) And although rich pension deals make headlines, it’s not clear how widespread they really are.
More generally, though: do ordinary workers (clerks, school teachers, construction workers, etc.) make as much as their private sector counterparts? Or more?
Thinking about this reminded me of a story my father tells about his days as a negotiator for the local teacher’s union in the mid-80’s. At a time when the economy was going along pretty well, the teachers contract came up, and they asked for a large raise, pointing out that lots of other people in the area were getting big raises. They were told “You knew that education didn’t pay well when you became teachers. If you wanted to make lots of money, you should’ve done something more lucrative.” They ended up negotiating a three-year contract with specified raises that were decent, but not as good as they had hoped.
A year later, the economy went in the tank, and the very same people who had been pooh-poohing the idea that teachers should get big raises during good economic times turned up at board meetings ranting and raving about how it was totally outrageous for teachers to be getting pay raises at a time when other people were suffering.
This is a roundabout way of coming around to my thought regarding the “Cadillac plans” public employees have, which is that the “Cadillac plan” they currently have probably didn’t seem like such a sweet deal back when the contracts were first hashed out.
To the limited extent that it’s true that public employees have better benefit packages than corporate sector workers, it’s not because the public employees have been getting really sweet deals from their employers. Rather, it’s because white-collar corporate employees, who do not have the benefit of unions and the like, have been getting the shaft for years now. The benefit deals that look so sweet now were pretty ordinary not all that long ago, but haven’t changed as rapidly as private sector plans did in response to the explosion in health care costs.
If that’s the case, my response to people complaining about sweet benefits packages in the public sector (or in union industries like US automaking) is the same as my father’s reaction to people complaining about the outrageous raises the teachers were getting: Tough shit. If you wanted income security, you should’ve gone into a public sector job.
Those benefit packages were offered in lieu of higher salaries back in the day, which seemed like a pretty good deal to the people running the show. Now that the costs have turned out to be inconveniently high, they want to get out of the promises they made to their employees, but that’s not how things work.
If you trade security and benefits for the chance at higher profits, that’s your choice. But you don’t get to laugh at those who made a different choice in good times, and then drag them down when things blow up in your face. You bought your chips, you spun the wheel, you have to take whatever you get.