The United States is acting and looking more like Greece every day. Americans got a glimpse of their fiscal future when European markets, currencies, and politics were roiled over the impending bankruptcy of some of their profligate nations, most notable Greece, which had made a science of the easy life.
Greeks who worked in so-called arduous jobs retired at age 50 for women and 55 for men. More than sixty jobs qualified for the early retirements, including musicians, radio personalities, waiters, and hairdressers. A Greek was even luckier to land a government job, says Charles Sykes in his revealing, but depressing book, A Nation of Moochers. (1)
“In just the past decade the wage bill of the Greek public sector has doubled, in real terms—and that number doesn’t take into account the bribes collected by public officials. The average government job pays almost three times the average private sector job,” reports Michael Lewis. (2)
Early retirement sounds great. “But when 10 grandparents have four grandchildren, who pays for you to spend the last third of your adult life loafing around,” asks Mark Steyn.
“Public sector workers have succeeded in redefining time itself: Every year, they receive 14 monthly payments. You do the math. And for about seven months’ work: for many of them the work day ends at 2:30 pm. And when they retire, they get 14 monthly pension payments. In other words: Economic reality is not my problem. I want my benefits. And, if it bankrupts the entire state a generation from now, who cares as long as they keep the checks coming in until I croak.” (3)
How Does the United States Compare?
Today in America there are nearly twice as many people working for the government (22.5 million) than in all of manufacturing (11.5 million). This is an almost exact reversal of the situation in 1960 when there were 15 million workers in manufacturing and 8.7 million collecting a paycheck from the government. (4) On average, our nation has lost 10 factories and 2,000 manufacturing jobs every day during the past 10 years.(5)
Stephen Moore adds, “More Americans work for the government than work in construction, farming, fishing, forestry, manufacturing, mining and utilities combined. We have moved decisively from a nation of makers to a nation of takers. Nearly half of the $2.2 trillion cost of state and local governments is the $1 trillion a year tab for pay and benefits to state and local employees. Is it any wonder that so many states and cities cannot pay their bills? Every state in America today except for two—Indiana and Wisconsin—has more government workers on the payroll than people manufacturing industrial goods. Consider California, which has the highest budget deficit in the history of states. The not-so-Golden State now has an incredible 2.4 million government employees—twice as many people as those at work in manufacturing. New Jersey has just under two-and-a-half as many government employees as manufacturers. Florida’s ratio is more than 3 to 1, so is New York’s. (4)
Many public employees can retire in their 50s (or even on their 40s), sometimes with six-figure pensions. Furthermore, public pensions are so generous that many public employees come back for seconds. Double-dipping from the public trough is fairly widespread, including a Florida college president who pocketed an $893,286 retirement lump-sum payment on top of his $14,631 monthly pension—while still drawing $441,538 in salary. It was all perfectly legal: Florida law allows officials to ‘retire’ for thirty days and then return to work at their old jobs at full salary, while collecting their pensions. The St. Petersburg Times found that nearly two thousand Florida officials collect pensions and paychecks form the public. (6)
In Washington State, educational bureaucrats also enjoy the sweet taste of the double-dip at the public trough—without having to move or even change jobs. The Seattle Times found nearly two thousand double-dipping state employees at a cost to taxpayers of $85 million a year. (7)
This pales in comparison to Ohio, whose teachers’ retirement system paid out more than $741 million to 15, 857 faculty and staff members who were still working for school systems and accumulating a second retirement plant. (8)
It Gets Worse
Increasingly, those who take responsibility are being asked to bail out the profligate. The milestones are troubling as Charles Sykes notes:
- Even as more people became dependent on government, fewer were paying their share of the tab. By tax day in 2010, nearly half of US households paid no federal income taxes. After years of cuts, credits, and outright rebates, 47 percent of households had no net liability at all. A family of four could make up to $51,000 without paying a nickel in federal income taxes. Many of them have a ‘negative tax liability,’ which means they get a check from the government.
- While the top 10 percent of earners now pay around 73 percent of the federal income tax burden, fully 40 percent of individuals actually got more money from the tax system than what they paid in. Rather than sending in a tax payment on April 15, the government actually sends them a check, paid for, of course, by other taxpayers.
- The gap between the two Americas( the public and private sectors) continues to grow. According to the Bureau of Economic Analysis, federal employees now earn more than double what private sector workers make. In 2009, the average federal civil servant pulled down pay and benefits of more than $123,000, while private employees made do with an average of $61,051 in total compensation. The gap between the two Americas has grown in the last decade, with the gap between the compensation of federal and private workers more than doubling. In addition to the cushier salaries and benefits packages, government workers on average also have more job security and far richer pensions, and more vacation days.
*No program has grown more explosively than the program formerly known as food stamps. In just two years, the number of people on food stamps rose by more than 10 million, while spending nearly doubled. On election day in 2008, 31 million people were on the rolls, at a cost to taxpayers of $39 billion in fiscal year 2008. Within two years, the number of recipients rose to 42.4 million and the federal 2011 budget projected spending $75 billion.
- There is a noticeable gap between average America and the new privileged class of public employees who enjoy expensive fringe benefits and lavish pensions that increasingly define a growing divide among Americans. Even as private-sector worker struggle to find and keep jobs and pay their bills, politicians have lavished expensive perks on public employees under the baleful eyes of ever more powerful public employee unions. (9)
When Wisconsin Governor Scott Walker proposed curtailing public-employee union power, the state’s capital was besieged by hundreds of thousands of protestors and gripped by weeks of legislative gridlock and legal wrangling. Teachers staged illegal sickouts, legislators received death threats, businesses were threatened with boycotts, and civil rights leaders descended on Madison, Wisconsin. The union’s dramatic backlash exposed not only the gap between the benefits of the public and private sectors, but also the depth of the sense of entitlement among well-heeled public employees who had drunk deep from the cup of victimism. In some respects, Madison may have represented the first Greece-like moocher rebellion. (10) After the unions failed to block legislation implementing Walker’s plan, they tried to recall him in a special election. On June 5, 2012 they failed, as Walker won reelection and a solid mandate to stay his course. One bright spot in all this ‘moocher’ mess!
So there you have it. Couple all this mooching with our continued expensive efforts to serve as the world’s watchdog with military in all parts of the globe and you have to ask the question: When will all this come crashing down.
References
- Charles J. Sykes, A Nation Of Moochers, (New York, St. Martin’s Press, 2011), 135
- Michael Lewis, “Beware of Greeks Bearing Bonds,” Vanity Fair, October 1, 2010
- Mark Steyn, “America’s Future Could Be All Greek To Us,” ocregister.com, February 26, 2010
- Stephen Moore, “We’ve become a nation of takers, not makers,” onlinewsj.com, April 1, 2011
- Arthur B. Robinson, Access to Energy, 39, 4, December 2011
- Lucy Morgan, “Double dipping rises despite outrage,” St. Petersburg Times, December 28, 2008
- Nick Perry and Justin Mayo, “Retired, then rehired, How college workers use loophole to boost pay,” The Seattle Times, June 26, 2010
- Bill Bush, “School employees can get paid twice,” Columbus Dispatch, September 20, 2009
- Charles J. Sykes, A Nation Of Moochers, 13
- Charles J. Sykes, A Nation Of Moochers, 148
