Salary Ceilings

Lots are floored by low pay

When California Business Consultant Phillip Sanchez, former director of the Office of Economic Opportunity, was sounded out about becoming Ronald Reagan's Secretary of Housing and Urban Development, he refused. Said Sanchez: "It would be financially impossible for me to go back into Government at this time." The job was offered next to New York Lawyer Samuel R. Pierce Jr., who was also hesitant and for the same reason: he would have to take a substantial pay cut, from his six-figure salary to the $69,630 that Cabinet members earn. Finally, Pierce decided that he could afford to get by with less money for a few years and accepted the nomination.

Low pay, at least in comparison with salaries for equivalent jobs in private life, was one of the reasons that Reagan had so much difficulty in filling several of his Cabinet seats. His transition team is having similar trouble finding people for the 2,700 top-and middle-level posts that are not covered by Civil Service. Says a Reagan staffer: "High-level officials are embarrassingly underpaid for the work that they do, and that has made it much harder for us to get some of the people that we want." The Carter Administration had the same difficulties. Says a member of the Commission on Executive, Legislative and Judicial Salaries, which recently completed its quadrennial study: "The most astounding thing that we found was the difficulty of getting people with first-rate minds to work in the Government and then keeping them long enough to have an effect." Warns Democratic Senator Russell Long of Louisiana: "At the level of assistant secretary and similar jobs, it is a matter of asking for mediocrity and even incompetence."

According to the commission, Government pay scales, particularly those for executive-level jobs, lag far behind their approximate counterparts in private industry. The commission has proposed to President Carter substantial salary increases for all branches of Government. The panel recommended that the highest ranking officials, including Cabinet members, earn $95,000, rather than the current maximum of $69,630. For officeholders just below the highest echelons, the commission proposed raises averaging $23,000. In addition, the commission urged that Representatives and Senators, who now earn $60,662, get a raise of nearly $25,000, and that Associate Justices of the Supreme Court be paid $115,000, vs. their present $72,000.

Carter is expected to cut these proposals considerably when he makes his final recommendations as part of the budget message that he will send to Congress on Jan. 15. Reagan has endorsed boosting congressional salaries by $10,000 and senior Government officials' wages by $6,000. Some of his aides would prefer heftier increases. Says a Reagan headhunter: "Ten thousand dollars can determine whether a number of people stay in the private sector or come to work for us."

Major corporations, notes the commission, have done a far better job of keeping executive salaries in line with inflation than the Government has: pay has risen 116% to 120% for private-sector executives since 1969 but only 43% for top bureaucrats. Salaries of court of appeals judges rose 35% during that period, but lawyers in private practice saw their earnings leap 100%. Scarcely anyone, however, truly kept up with inflation during those eleven years, when the Consumer Price Index rose a staggering 130%.

Standing in the way of federal pay increases has been Congress, most of whose members regularly vote against raises for themselves and other top officials as a symbolic blow against inflation--and a survival tactic with their constituents. Since 1976 Congress has suspended or reduced automatic cost of living hikes for top officials. Salary increases for top federal jobholders are linked to those for Congress; thus, if Congress holds the lid on itself, no one else gets a raise. The main argument against pay increases, say their opponents, is that federal workers earning $50,000 to $60,000 a year are better able to cope with inflation than the typical U.S. family of four, whose median income is about $22,000. The Supreme Court last month ruled that the freeze did not apply to Justices' salaries, thereby giving themselves and all other federal judges 13% raises. But the ruling did not extend to the Executive or Legislative branches.

Below the top-level jobs, the pay gap between the private sector and Government is not as severe as it once was. In some cases, such as secretarial and certain specialized administrative jobs, earnings of Government workers are higher than those in private industry. Ironically, because the pay freeze does not extend below $50,112, some career bureaucrats who get annual raises because of Civil Service rules earn the same as their bosses, most of whom are political appointees.

By law, top pay for bureaucrats covered by Civil Service rules cannot exceed the salary for political appointees in Executive Level Five. Thus absurdities abound. The Joint Chiefs of Staff earn $50,112, precisely what the Deputy Joint Chiefs of Staff make and, as it happens, the same as the head of the Oklahoma City air logistics center. Such imbalances ought to increase pressure on Congress to vote raises some time this year, especially when no one is up for reelection. Even so, the freeze is not likely to be lifted, and for the same old shortsighted reason: it looks bad for Congress to increase its pay when constituents are suffering from inflation. qed

This file is automatically generated by a robot program, so viewer discretion is required.