Tag: Employment compensation

Pay Day

Bloomberg today has an astounding report on how workers have been able to abuse compensation systems in various states:

Nine years ago, California Democrat Gray Davis became the first U.S. governor in 82 years to be recalled by voters. The state’s 20 million taxpayers still bear the cost of his four years and 10 months on the job.

Davis escalated salaries and benefits for 164,000 state workers, including a 34 percent raise for prison guards, the first of a series of steps in which he and successors saddled California with a legacy of dysfunction. Today, the state’s highest-paid employees make far more than comparable workers elsewhere in almost all job and wage categories, from public safety to health care, base pay to overtime.

Payroll data compiled by Bloomberg on 1.4 million public employees in the 12 most populous states show that California has set a pattern of lax management, inefficient operations and out-of-control costs. From coast to coast, states are cutting funding for schools, public safety and the poor as they struggle with fallout left by politicians who made pay-and-pension promises that taxpayers couldn’t afford.

It’s not just California. Pension managers are among the worst. In Texas, the head of the Teacher Retirement System was paid over a million dollars last year. Psychiatrists are making $300,000 per year. They even have a few police officers netting nearly $200,000 in compensation.

Look, I think state workers should be paid reasonably. And, on balance, they are. Cato’s research has shown that while federal employee compensation is massively in excess of industry standards, state employees are closer (although with generous benefits and greater job security). But the system of overtime, unused leave and pension spiking, combined with a basic lack of supervision, have created a situation where certain individuals can collect gigantic salaries. In California, one psychiatrist claimed he was working 17 hours a day and pulled in $822,302 in 2011.

You really need to read the whole thing. We are talking about billions and billions of dollars here. From states that are having to slash extant services to feed the pension and perks beast. It’s a disgrace. And everyone — from conservative who hate government spending to liberals who want government spending to help people — should be up in arms about it.

Minimum wage, in a way even the most stupid can understand.

The concept of a living wage and a minimum wage are universally accepted on the left as great ideas. That they do not work in the real world and produce serious consequences is ignored. But now we have an example that is too easy to ignore:

The catchy Subway sandwich shop jingle involving a variety of foot-long sandwiches available for $5 doesn’t apply in San Francisco. The sandwich-making chain stopped selling the five-dollar footlongs in San Francisco due to the “high cost of doing business,” according to SF Weekly.

Signs posted at Subway sandwich shops sadly inform San Francisco patrons — we hear Willie Brown is a big fan — that “all SUBWAY Restaurants in SF County DO NOT PARTICIPATE IN Subway National $5.00 Promotions,” according to the newspaper.

Customers can still buy the sub of the month for $5, according to an employee at Subway on Market and Castro streets. Apparently, the city’s new minimum wage, raised to $10.24 as of Jan. 1, make $5 footlongs an impossible business model.

Unless you want tuna fish, which is the sub of the month. Yum.

I guess it is Karmic justice that this happens in one of the biggest liberal bastions in this country, and definitely not a coincidence, but I doubt the left will get the lesson.

It’s simple really: when government forces employers to pay too much for labor, especially labor that can be performed by a monkey because it requires no serious skills or abilities, the customer bears the brunt of that coerced transaction. The price of everything goes up, often by far more than whatever the jacked up minimum wage supposedly added to the pocket of the person making it.

Seriously, if the minimum wage/living wage concept worked, we could just make sure everyone was paid $60K or more a year for a 40 hour week, couldn’t we? Of course that $60K would not do much good, because it can’t happen in a vacuum. Once you force employers to pay out that much, they have to adjust their business model. For one, it means that less people will be employed, as employers adjust to accommodate this new burden, and then the employers will have no recourse but to jack up prices to make up the balance. And contrary to the belief collectivists have that otherpeople should just do things for the satisfaction of helping out, private sector owners will still need to make a profit too.

Only idiots that are totally disconnected from reality believe that all employers should be like government and provide non-profit make-work jobs that pay a living wage to everyone. That government can only do what it does now because it is taking a whole lot of money away from those that actually are being productive and actually have to make a profit to justify the effort to the owners, and that they constantly are trying to take more to feed the ravenous unproductive machine, gets ignored.

Seriously, is it so hard to understand that if everyone making at least $60K a year, the cost of living adjustment needed to accommodate this burden, suddenly makes the necessities that used to cost $X a month, now cost $10X? Don’t even start on luxury items. This logic is not that hard to work through.

I guess San Franers can now envy the rest of us for being able to get them $5 footlongs, while those of us that understand economics and the way the world works can laugh at their stupid move to have such a ridiculously high minimum wage. The fact is that someone ALWAYS pays for the free stuff the collectivists believe they are due.

Teach for Chicago

Well, now isn’t this convenient:

Two lobbyists with no prior teaching experience were allowed to count their years as union employees toward a state teacher pension once they served a single day of subbing in 2007, a Tribune/WGN-TV investigation has found.

Steven Preckwinkle, the political director for the Illinois Federation of Teachers, and fellow union lobbyist David Piccioli were the only people who took advantage of a small window opened by lawmakers a few months earlier.

The legislation enabled union officials to get into the state teachers pension fund and count their previous years as union employees after quickly obtaining teaching certificates and working in a classroom. They just had to do it before the bill was signed into law.

Do I even need to tell you that these two guys lobbied for the very law that will now give them at least a million in retirement benefits?

Look, I have no problem with teachers getting good retirement benefits. Nor do I have a problem with union reps getting retirement benefits, providing they are paid out of union money. I do have a problem, however, when a lobbyist is able to raid public funds based on a single day of teaching. We shouldn’t be paying these guys to lobby for more spending and we damn sure shouldn’t be paying them retirement benefits for lobbying.

Not much can be done — what they did was legal. But it really does illustrate the priorities of the union. In future years, real teachers are going to see their salaries or benefits reduced. But these two suckers will pull in millions.