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Piling on the Perks

by Pete Sepp / /

Government Bytes readers are no strangers to posts on Congress’s plentitude of perquisites, most recently regarding the retirement packages of Anthony Weiner and David Wu. Yet, a recent report from Our Generation and the Taxpayers Protection Alliance serves as a costly reminder that after the dust settles from the latest ethics storms, the care and feeding of lawmakers – scandalized or not – can be quite costly to taxpayers.

Co-authors MacMillin Slobodien of Our Generation and David Williams of Taxpayers Protection Alliance plow some interesting new ground on a topic that NTU has studied in-depth for years. But first, some more familiar dirt: the salary for a rank-and-file Member of Congress ($174,000) is 3.4 times more than the average full-time employee in the U.S. earns. No huge news there, except, as Slobodien and Williams note, this ratio is among the most generous in the developed world. Compared to a dozen other industrialized nations, only Japan has a higher “pay gap” between legislators and average workers (3.7 to 1). The ratio of lawmakers’ salaries to average wages was significantly lower in places like the UK (2.2 to 1), France (2.0 to 1), or Germany 2.8 to 1).

When I was in college a long time ago in a galaxy far, far away, I remember several occasions when guest lecturers from abroad in my politics classes would utter tsk-tsks at us unsophisticated Americans for not valuing our legislators highly enough and setting their paychecks accordingly. While this report may not completely settle the debate over whether our Senators and Representatives are under- or over-paid for their jobs, it ought to put to rest the notion we are grossly behind the rest of the world in how much salary we give them.

What should prove equally fascinating (or perhaps alarming) to taxpayers is that the total Congressional compensation package – including the salary, the value of health and life insurance, a defined benefit pension, a defined contribution arrangement with a generous “match” from taxpayers, and other goodies – adds up to nearly $285,000. Andrew Biggs, a resident scholar at the American Enterprise Institute and a wiz at government employee benefit comparisons, lent his expertise to the calculations. Now we’re talking real money.

Slobodien noted that “Immediate steps must be taken to cut Congressional salaries and benefits and reassure Americans that sacrifices made during this economic downturn are being shared.” Williams added that “With the high salaries Congress is collecting, we don’t think it’s too much to ask that they do their jobs and get our economic house in order.”  How Congress responds to these conclusions will likely pique the interest of taxpayers in other countries as well as in the U.S.