Government workers' pay and benefits are far better than their private-sector counterparts, according to David Denholm, president of the Public Service Research Foundation.
“The U.S. Bureau of Labor Statistics reports that in 2005 median weekly earnings for full-time government workers averaged $758, compared to $625 for those in the private sector,” Denholm wrote in in an essay for Budget & Tax News published online by the Heartland Institute.
Denholm said that the disparity of private and public worker benefits is due in large part to the power of public-sector unions.
“Most states require government agencies to collectively bargain with unions representing their employees, but public-sector unions, unlike private-sector unions, also play a big role in electing the boss,” Denholm wrote. “Unions of public employees, particularly at the local government level, have an extremely high level of motivation to influence elections.”
And while government employees do pay the same tax as private-sector workers, they generally end up better in the long run, Denholm said.
“Consider two households--one with a private-sector worker and one with a local government employee--with equal incomes of $40,000,” Denholm wrote. “Assume state and local taxes are approximately 10.5 percent of income.”
If the local government imposes a 4 percent tax increase to fund a 5 percent pay increase for government employees, both families face an increased tax burden of $168, Denholm calculated.
“But the government employee's household would also anticipate
a $2,000 pay hike ($40,000 x .05 = $2,000), for a net gain of $1,832,”
Denholm wrote. “A $1,832 gain likely would provide greater
motivation to walk precincts, stuff envelopes, contribute money,
and turn out on Election Day than the expected $168 increase in
taxes.”