Public Employees Price Themselves Out of A Job

“April is the cruelest month”, it being budget time again in the Rivertowns of Westchester County, New York.  And the theme this year is that public employees have priced themselves out of a job.    In Dobbs Ferry, my hometown, for the first time in decades, the Village is cutting jobs through attrition:  two police officers and one garbage man.  That represents a 5% decline in the Village’s full-time employment.  These cuts were initiated by the former Democratic administration of Mayor Scott Seskin.  They have now been formalized by the new administration of Republican/Dobbs Ferry Party led by Mayor Hartley Connett.  In Ardsley, the School District is threatening to cut 23 teachers.  In the Tarrytown School District, 34 full-time employees are being axed or 6% of the workforce.  In Hastings-on-Hudson, 17 positions are being eliminated by the School District; 11 through attrition, six through lay-offs.  Even the well-managed Dobbs Ferry Free Union School District has had to cut a few fractional heads to keep the tax increase below 2% this year.   

The economic forces behind these cuts are exploding pension costs, medical premiums and pay escalators.  Even if the headline number is a 2% salary increase, when adding in the ‘steps’ and ‘grades’ most employees are getting 5% to 7%  increases per year, well in excess of the private sector and the inflation rate. 

In Dobbs Ferry, this is evident in the numbers.  The median income is $81,000 in the Village, but the average teacher is now making $97,000.  A police officer with only five years of service makes $91,000 per year in salary alone – more than half of the Village’s 11,000 inhabitants — , while a police lieutenant with benefits and overtime makes at least twice the Village median income.  As a rule of thumb, civil servants should not make more money that 50% of the people they serve. When they do, the local economy becomes stressed and people start to leave.  In Dobbs Ferry, the tipping point has been reached causing long-time residents to move out after their kids finish high school.

In the good old days, before “Greedonomics”, civil servants were underpaid and they had to form unions to protect their rights and secure themselves a decent living.  But over the years, effective union representation and an insidious conflict resolution system based on ‘pattern’ [i.e., the weakest link] and arbitration has culminated in public employees earning more than the median wage of their constituents.  Even for socialist Obama Democrats, who believe in ‘each to his ability; each to his need’, i.e., everyone should earn the same amount of money, the current situation necessitates drastic change.

But the political class either doesn’t know what to do or is afraid of alienating institutions/contributors as powerful as the Police Association or the Teacher’s Union.  [There is no-thing more dangerous than a Police Association scorned.]

The short-term solution is for  Governor Patterson to  declare an economic state of emergency and freeze all salaries, steps and grades for the next three years.  In addition, pensions should be reduced for all employees and retirees – current and future – to 50% of final five-year salary excluding overtime.  50% of salary plus Social Security is a decent living for a retired person.  Finally, all future increases in medical premiums should be shared 50/50 between the employee/retiree and the local government.  Sharing health care premium increases 50/50 would take the fun out of any tea party and really focus people on achieving real health care reform.

Postscripts: 

Westchester County is considering eliminating 1,600 jobs. 

New Rochelle Board of Education is cutting 78 positions.