Clinton comptroller blasts government workers’ accrual of benefits at expense of private sector workers

America’s recession is exposing societal fault lines, as various groups fight over increasingly smaller pieces of the pie. Tensions are particularly flaring between government workers and employees of private businesses.

David Walker, the U.S. comptroller appointed by President Bill Clinton who continued in the role under George Bush, on Friday gave a bracing indictment of the pension and salary benefits being rewarded to government workers at the federal, state and local level. Walker said that public sector workers are growing prosperous on the back of private sector workers.

“There is a huge gap. State and local plans on average … are much more lucrative than typical plans for employees. State and local government employees, on average, have greater job security than people in the private sector. And state and local government employees, in the middle of government, in many cases make more money than their private sector counterparts,” Walker said during a speech at the U.S. Chamber of Commerce. According to Pew numbers provided by the Chamber, the budget gap to cover state employees’ benefits totals $1 trillion.

“Therefore, if governments expect taxpayers to pay more taxes to fund lucrative benefit programs that are much better than the average employee gets, in jobs that more job security and in some cases make more money than their private sector counterparts, that ain’t gonna happen,” he said. “But the only way it’s not going to happen is if there’s transparency and if the cover is blown, so that pressure is brought to bear to make changes.”

Walker, who is now president and chief executive of the Peter G. Peterson Foundation, said there are “many vested interests in the status quo, whether it be elected officials, appointed officials, union officials or otherwise.”

“The only way you’re going to break the cycle is to make this information public in an understandable, clear, compelling and concise form, such that the first three words of the Constitution can come alive: we the people. That’s the only way,” he said.

Walker spoke at the beginning of a half-day Chamber conference on the “impending dangers of the retirement financing crisis.”

He emphasized that he thought state pension fund obligations are only part of a larger “national fiscal challenge” at all levels of government spending, with health-care costs being the most explosive cost driver.

“We must wake up. We need to make dramatic and fundamental changes at all levels of government,” Walker said, going through a series of slides showing future government spending obligations completely overwhelming tax revenues.

Walker’s speech, and the comments of some of the panelists who spoke after him, were met with strong disagreement and at times derision by labor officials and union-aligned representatives who sat at the back of the room. A small group laughed out loud several times during remarks by Diana Furchtgott-Roth, an analyst at the Hudson Institute.

“The biggest fallacy here is the discussion about comparing what a private sector employee gets to a public sector. And if where we want to go from a policy perspective is to go down and bring everybody’s boat down, so that they’re retiring on nothing, I mean that’s an interesting conversation to have. What do you do with those people?” said Cathie G. Eitelberg, senior vice president at the Segal Company, which advises public employee pension fund directors.

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  • loudog

    Our country is morally and financially bankrupt and Republicans offer only the same policies that got us here in the first place.

    From Reagans Director of OMB – “Republicans used to believe that prosperity depended upon the regular balancing of accounts — in government, in international trade, on the ledgers of central banks and in the financial affairs of private households and businesses, too. But the new catechism, as practiced by Republican policymakers for decades now, has amounted to little more than money printing and deficit finance — vulgar Keynesianism robed in the ideological vestments of the prosperous classes.
    IF there were such a thing as Chapter 11 for politicians, the Republican push to extend the unaffordable Bush tax cuts would amount to a bankruptcy filing. ”


    • clw

      LD, your post is so utterly laughable.

      You address NOTHING in the article, but skip DIRECTLY to “Republicans offer… Republicans used to… Republican policymakers… Republican push…”.

      How TYPICAL of the left to IGNORE the article, comments, and facts at hand and go right to Republican-bashing induced by the same old Bush derangement syndrome!

      You’d THINK the left would TRY to make some coherent arguments about the article since no one buys your same old Right-bashing diatribe. It’s obvious that you really do “got nothin'”.

      • loudog

        Funny that a quote by an ex-Reagan official is called BDS. Hilarious even!

    • barryaz

      Funny, the majority in Congress has been the Democrats since 2006. What happened there?

      • loudog

        Maybe you’ve heard of the housing bubble and financial industry meltdown. For more info see Gramm Leach Bliley Act and CFMA.

  • clw

    …even if you buy the argument that the huge public sector retirement packages are disputed; “However, Urbanek said, Codell’s salary when he retired in 2009 was $221,000, and his annual pension is $163,000, not $602,000 as was listed on Lauzen’s chart”… the pay and pension are 4-6 times what the average American gets. It’s un-merited, excessive, undeserved, and unsustainable. Once again, a shining example of liberals being very generous with other peoples’ money. The end result has NO chance of anything but complete collapse of the status quo. The American people are NOT going to stand for it, and those who are on the receiving end of these packages, and those who continue to endorse them, are in the crosshairs.

  • lht

    I don’t want to get into the entire public vs private debate, but I am stunned by the retirement payouts many government workers have been promised. It’s mind-boggling to see mid-level employees of average competence (to be nice) receive almost their entire salary in retirement. Private sector workers are lucky to get 10-20 percent.

  • America111

    I live in California and can tell the rest of US if you want to see what Democrates what to do just look here. The public sector pensions have more then bankrupt this state and the rest of Dem’s agenda finished off what was once the greatest state and economy in the country. They have turned it into 1 big welfare state by driving out private business with outragous and crazy regulations and higher and higher taxes to keep up thier life style and now there is nobody left to tax, but they are still pushing “Progressively” forward into the abyss. Please people look at California & you will see the future of the country with these fools at the helm. god bless

    • barryaz

      You are correct in your assessment as it pertains to the CA retirement system. I have personally spoke to former CA city and state workers who brag of getting pensions amounting to 102% of their salaries in retirement. Any second grader could have told you this would be unsustainable. In addition, how much sense does it make to earn 2% more salary in retirement than while you were working. Who were the legislatures that voted on this stupidity? I am all for someone getting a retirement after years of dedicated service to any organization, but at this amount it appears the system may have some problems which need to be addressed…and QUICKLY

  • rfpzzzzz

    Obviously government takes money from the private sector, ie., taxes. How do you think folks like Clintons get rich enough to pay for multi million dollar weddings? Is is because they care for the poor?
    Government is a parasite. It feeds off the body of society. It takes your money, spends it, then borrows in your name to pay you back with social security and other things.
    What they do with that money between when they take it in with taxation and when they pay it out with borrowed funds is the issue. It seems they use those taxes to enrich themselves either by legal or illegal means.
    This is why smaller , more effective and more accountable government is a necessity not a choice. Sooner or later it will happen. Whether it will be forced upon us by conditions or we willingly reform government and the legal system it will happen.

  • gregbo

    “The biggest fallacy here is the discussion about comparing what a private sector employee gets to a public sector. And if where we want to go from a policy perspective is to go down and bring everybody’s boat down, so that they’re retiring on nothing, I mean that’s an interesting conversation to have. What do you do with those people?” said Cathie G. Eitelberg

    All wealth is created in the private sector. As the public sector continues to grow it creates a constituency that can vote to amass more private sector wealth to itself. The reality is that the private sector can no longer support either the the massive local, state and federal government behemoth or private pyramid penson schemes. All boats are taking on water. Start bailing.

    • lht

      “All wealth is created in the private sector.”

      This is one of those fuzzy statements that sounds cool but obviously isn’t true. Though one could have a lot of fun trying to decipher exactly what is intended by the term “wealth.”

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