President Obama's decision to freeze the pay of federal employees is a good first step in turning around a federal budget disaster. Now, Congress must jump on board.
This is a move that the President should have taken when he first took control of the White House. But as the economy crumbled and the private sector did everything possible to control employee costs — including massive job layoffs — the federal government went ahead with business as usual. A study by the Heritage Foundation shows that the pay and benefits of federal workers is currently 30 percent to 40 percent higher than the comparable employees in the private sector. And the USA Today reports that federal employee pay has risen 37 percent after inflation over the past decade.
It is far past time for a freeze. The move is expected to save some $28 billion over the next five years — money that should be devoted entirely to reducing the federal deficit. It could, however, be an even bigger savings if the government would drop the hammer down a little harder. President Obama's pay freeze order does not impact costly benefits nor does it put a halt to seniority raises. And, for the most part, federal pay is not merit-based, meaning employees are rewarded regardless of the quality of their work. The Heritage Foundation estimates that aligning federal pay and benefits more closely to the private sector and adopting a pay-for-performance system for all federal employees could save $48 billion a year. That would be even more impressive.
Before the freeze can take effect Jan. 1, Congress must first approve it. That could be difficult during a lame duck system, where labor unions will lobbying hard to block the measure. But after the first of the year, with Republicans in control of the House, the prospects of passage greatly improve. There are several GOP members of the House suggesting an across-the-board federal pay cut of 10 percent. That certainly should be explored, too.
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