Tue, March 08, 2011
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Anger brews over US government workers' benefits

2011-03-08 13:54:02 GMT2011-03-08 21:54:02(Beijing Time)  SINA.com

Protestors continue to occupy the State Capitol in Madison, Wisconsin February 27, 2011. (REUTERS/Darren Hauck)

Participants in a rally sponsored by Americans for Prosperity gather under a statue of Abraham Lincoln, outside the Nebraska State Capitol in Lincoln, Neb., Friday, March 4, 2011. (AP Photo/Nati Harnik)

When Erin McFarlane looks at public workers, she sees lucrative pension benefits she doesn't ever expect to get. And it makes her mad.

"I don't think that a federal employee or government employee is worth any more than anybody else who does their job and does it well," said the Slinger, Wis., woman. She's been working a couple of bartending jobs since January, when she was laid off from her job at a Harley Davidson plant after almost a decade.

She's not alone in seeing public servants as public enemies in some ways.

It's a case of pension envy.

For McFarlane, 36, it's part of a ubiquitous discussion, at the bars where she works and on Facebook. And it's the center of some of the biggest political battles playing out in state capitals across the country as governors say their states can no longer afford the benefits that public employees have been promised.

Government workers in McFarlane's state have rallied for weeks against Gov. Scott Walker's efforts to take away many collective bargaining rights, saying that would amount to killing the middle class.

A USA Today/Gallup poll last month found show that Americans largely side with the employees, though about two in five that want government pay and benefits reined in.

Barbara Davis, a retiree from Cherry Hill, N.J., has been watching public workers in rallies in Madison, Wis., as well as Trenton. She says the protesters are wrong about tightening benefits hurting the middle class.

"I'm sorry, but what they're doing is telling off the middle class," said Davis, 76, and a co-chairwoman of the Cherry Hill Area Tea Party. "The middle-class people don't get all the goodies that they do."

At its heart, the issue is this: Some public workers get a sweet deal compared to other workers. And it's taxpayers who pay for it.

That's set off resentment in a time when economic doldrums have left practically everyone tightening their belts. Many people have found their tax bills rising even if their earnings haven't.

In Davis' case, it's the property tax that smarts. She and her husband pay about $12,000 per year for the house she describes as a three-bedroom "tract home." That's a high tax even in New Jersey, where the average property tax bill tops $7,000 and where the Tax Foundation has found homeowners pay three and a half times the national median.

A half century ago, industrial jobs at car and steel plants provided high salaries and rich benefits. But as manufacturing moved overseas, many formerly well-paid workers had to take lower-paying jobs. By the end of the Great Recession, the economic order was undeniably changed.

"It's the government sector worker who's the new elite, the highest-paid worker on the block," said David Gregory, who teaches labor and employment law at New York's St. John's University.

For instance, most non-uniformed public employees who have worked in New Jersey for 30 years with an ending salary of $85,000 can look forward to retiring at 55 with an annual pension of about $46,000. Working until age 60 and a salary of $90,000 can bring a pension of $57,000. And many of the New Jersey's public-sector retirees have no or low premiums for their health insurance.

For a private-section worker who retires at 55, relying solely on a 401(k) without an employer match, it would take a $100 contribution to a plan every week for 30 years and getting an annual return over 7 percent to get to the same level of pension benefit as the public worker retiring at that age. Those benefits would run out after 25 years for the 401(k) retiree.

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