The always-insightful Robert Cruickshank has a fascinating piece on Calitics today talking about the investigative reports showing that some state employees save up all their vacation time and get big payouts when they retire. It's true that some state workers walk away with upwards of $100,000, and it's true that it pisses people off, and it's true that there probably ought to be some reforms that limit the amount of vacation time you can save and cash in.
But as Cruickshank notes, the payouts have cost the state $486 million since 2006, and:
$486 million sounds like a lot of money. But that is just 2.43% of the current $20 billion deficit. In other words, if we had eliminated that practice in 2006, or capped it, the budget deficit would not be meaningfully impacted. In fact, given that we've had about $60 billion in budget shortfalls since 2007, these vacation payouts are 0.81% of the overall deficit.
Of course, these kinds of articles help build a larger narrative that the budget problem is in large part caused by greedy public sector workers who are paid too much. The actual numbers here indicate that the vacation payouts are not a meaningful part of the budget problem at all. Similarly, Meg Whitman's desire to layoff 40,000 state workers would probably save about $2.5 billion (assuming those workers make the state average). That's a bigger chunk of the projected $20 billion deficit, but it's still only 12.5%. Whitman and other critics of public employees need to come up with solutions for the other 87.5% of the deficit.
Maybe one place to start is by looking at how the rich evade their tax obligations. Last week the LA Times's Michael Hiltzik showed that Frank and Jamie McCourt paid no federal or state income tax between 2004 and 2009. Many wealthy Californians and large corporations have similarly evaded taxes.
So why do the relatively minor excesses by state employees get much more press attention that the vast cheating and looting of the public treasury by the rich and by big businness? Well, after 30 years in journalism, I can tell you one reason:
State employee payrolls are public record. It's easy to find out how much overtime Muni drivers make, or how many city workers earn more than $100,000 a year, or what the firefighters contract allows. Editors love these kinds of stories, because they always stir up populist indignation and outrage.
I've done it myself. We all do.
On the other hand, try to figure out how a big commercial property owner is using complicated stock transfers to hide a change in ownership and avoid tens of millions of dollars in property-tax liability. It's a bitch. That kind of work takes weeks, months of investigation and requires some sophisticated legal and financial knowledge. See, the private sector -- particularly the folks who are hiding behind tax shelters and scams -- is big on secrecy, and the laws don't help reporters.
Investigative reporting on the private sector is expensive. And in these days of diminished news budgets, not that much of it happens any more.
So the message you get in the press is that public employees are busting the budgets, and if we could just quit paying them so much money all would be fine. And the real budget busters, the real scam artists, the real crooks who are sucking the public treasury dry ... they just keep right one going. And nobody's paying attention.
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