Subject: Myth of the greedy public-sector workers
Myth of the greedy public-sector workers
How can politicians and the media be complaining about
pensions for government workers when a decent society
would guarantee a decent retirement for all workers?
August 18, 2010
POLITICIANS AND the media have found a new scapegoat for
the economic crisis and the savage budget cuts being
carried out by state and local governments:
public-sector workers and their unions.
It turns out the problem all along was overpaid and
underworked government workers. You know–all those
teachers and firefighters and social workers. And
especially the retirees selfishly living large on a fat
“We have a new privileged class in America,” Indiana’s
Republican Gov. Mitch Daniels told Politico. “We used to
think of government workers as underpaid public
servants. Now they are better paid than the people who
pay their salaries.”
Unbelievable. But these claims aren’t just coming from
Republican jerks. Earlier this month, the liberal New
York Times ran an article about the “coming class
war”–but in its upside-down world, the greedy villains
were teachers and bus drivers, not Wall Street bankers
or corporate CEOs:
The haves are retirees who were once state or municipal
workers. Their seemingly guaranteed and ever-escalating
monthly pension benefits are breaking budgets
The have-nots are taxpayers who don’t have generous
pensions. Their 401(k)s or individual retirement
accounts have taken a real beating in recent years and
are not guaranteed. And soon, many of those people will
be paying higher taxes or getting fewer state services
as their states put more money aside to cover those
Of course, the budget crisis hitting state and local
governments is real. On the very same day that the Times
drew a target on the backs of retired teachers, it
published an article documenting how states and
municipalities are making stunning cutbacks–from Hawaii
shutting down public schools on 17 Fridays during the
last school year, to the city of Colorado Springs
turning off one-third of its streetlights.
But the claim that public-sector workers are the source
of the shortfalls is absurd.
– – – – – – – – – – – – – – – –
FIRST OF all, the real cause of the state government
budget crisis is a massive reduction in taxes on
business and the wealthiest individuals over the last
If states and cities wanted to find money for public
spending, they could try eliminating the tax breaks they
handed out like candy to big corporations. Likewise, the
federal government could get $700 billion more in
revenues over the next decade if it got rid of the Bush
administration’s tax breaks for the richest few.
If public-sector workers seem to be better off, it’s not
because they’re doing so well, but because workers in
the private sector are doing so much worse.
One big reason for this is Corporate America’s attack on
unions. For the first time in U.S. history, government
workers are a majority of union members, largely because
of the sharp decline in unionization in the private
sector. Today, more than 37 percent of public-sector
workers belong to a union, compared to just over 7
percent of people who work for private companies,
according to the Bureau of Labor Statistics.
So one underlying motive for the scapegoating of
government workers today is the capitalist class’
old-fashioned hostility to working-class organization.
The attempt to demonize greedy public-sector workers is
part of the attack on unions in the one sector of the
economy where they remain strong in any measure.
But when you look a little closer at the claims of the
six-figure-income politicians, it turns out that even
the advantages that public-sector workers supposedly
enjoy are overstated.
Wages are, indeed, higher for government workers than
for many private-sector employees who do comparable
work, but state workers also tend to be older and more
likely to have graduated from college.
According to a study by economists Keith Bender and John
Heywood comparing private- and public-sector workers’
compensation over the last 20 years, once variables like
age and education are factored in, state employees
earned 11 percent less and local workers earned 12
percent less than their private-sector counterparts.
According to Bender and Heywood, “Over the last 20
years, the earnings for state and local employees have
generally declined relative to comparable private sector
The primary target for the scapegoaters is public
employees’ retirement plans–which are, in fact,
stronger than most private-sector workers enjoy today.
But once again, there’s a lot of deception here. For one
thing, many government workers aren’t eligible for
Social Security benefits when they retire, so a pension
is the only thing they can count on when they stop
Then there’s a larger question to answer: What do
employers, whether the government or a corporation, owe
workers when they become too old to work? If the
policies of private companies are taken as the measuring
stick, the answer is: Nothing at all. Except in a few,
dwindling cases, pension plans have become a relic of
the past. As the Center for Economic and Policy
Research’s Dean Baker wrote:
The reality is that public pensions are better than
private pensions, but this is largely because most
private-sector workers have little or nothing by way of
pensions. With a few notable exceptions (police and fire
pensions, along with those of IMF economists, tend to be
very generous), most public-sector pensions do not
provide retirees with an especially high standard of
We believe that all workers deserve to be able to retire
without fearing whether they can make ends meet, or if
their savings in 401(k) investment plans will get
hammered the next time the stock market tanks. Every
worker deserves a Cadillac pension plan–nothing less.
– – – – – – – – – – – – – – – –
AN ARTICLE in the NewRepublic makes it clear what the
attack on public-sector workers is really about. Its
title: “Why Public Employees Are the New Welfare
In the 1980s, the Republican Reagan administration tried
to focus blame for the economic crisis on “lazy welfare
mothers” who supposedly drove around in Cadillacs
collecting big government checks.
The lies about “welfare queens” and wasteful government
spending on social programs to help the poor were part
of an ideological offensive–along with the claim that
overpaid union members were pushing Corporate America
into the poorhouse–that accompanied the attack by big
business on working class living standards.
The ruling class offensive to take back the economic and
social gains of the 1960s and early ’70s was carried out
on several interrelated fronts, ranging from national
politics, to factories and offices, to popular culture.
Key to this employers’ offensive was creating scapegoats
to divide workers–union and nonunion, unemployed and
employed, Black, Latino and white–so that big business
could rule them all.
Today, it’s lazy, overpaid government workers–and their
“Cadillac” retirement plans. And while politicians and
the media try to pit different workers against each
other, the real welfare cheats get off scot-free. As
Baker wrote, commenting on the Times article about the
“coming class war”:
It is more than a little bizarre, and arguably more than
a little offensive, that the NYT would publish an
explicit call for an attack on the pensions of millions
of workers who never earned more than $40,000 or $50,000
a year. This is in a country where people like Erskine
Bowles (the co-chair of President Obama’s deficit
commission) get $350,000 a year serving as a director of
a company (Morgan Stanley) that only exists today
because of the generosity of the Fed and the taxpayers
when they rescued it in its time of need.
Make no mistake, either–this is a bipartisan attack.
When the Democrats’ candidate for California governor,
Jerry Brown, last month voiced support for Arnold
Schwarzenegger’s budget-cutting proposals, including
raising the retirement age, he explained himself this
way: “I’m not going to blame public servants for
problems that have been created by Wall Street hedge
funds and mortgage sellers, but at the same time, as I
did as governor, I know when it’s time to tighten our
But today’s assault on public employees in the name of
“getting through the crisis” will make it that much
easier to attack private-sector workers and their
shrinking union membership. Local governments are going
after unions precisely when workers need all the
organization they can muster.
As New York Times economics columnist Paul Krugman
In effect, a large part of our political class is
showing its priorities: given the choice between asking
the richest 2 percent or so of Americans to go back to
paying the tax rates they paid during the Clinton-era
boom, or allowing the nation’s foundations to
crumble–literally in the case of roads, figuratively in
the case of education–they’re choosing the latter.
There is a class war–and the politicians are on the
wrong side. All workers have a stake in taking on the
American ruling establishment’s warped priorities–and
countering the myth of “greedy public-sector employees”
that is being used to divide us.
We can’t let the politicians sell the lie that
government workers are taking too much of the pie when
Corporate America has control of the whole bakery.
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