Earlier this month Camden New Jersey laid off half its police officers and a third of its firefighters. Given Camden's dubious distinction as America's second most dangerous city – just narrowly edged out by St. Louis after years of occupying the top spot – this would seem a counter-intuitive move, but in the Bizarro world of wealth-through-debt, entitlements and outright denial of basic arithmetic, it makes perfect sense.
For Camden, as anyone with a calculator and/or a grasp of basic numeracy can tell you, is broke, to the tune of about $26 million. The police union – which appears to possess neither of these – refused outright to consider cuts in the form of unpaid leave days or any other adjustment to salaries that average $140,000 when benefits are factored in.
This resulted in some protests, street theater …
Eighty-three laid-off police officers put their work boots along the sidewalk near police headquarters to symbolize the lost jobs.
… and a brief glimmer of hope that the city government would actually hold fast and do the responsible thing:
In the end of course the local government – using what is become a dreary template – capitulated "solved" the problem by effectively deferring some of the police officers income until retirement, thus making it someone else's problem in the future, and raising taxes. This last expedient more or less ensures that anybody remaining who actually contributes to the economy and can possibly leave Camden will. Presumably this in itself will ameliorate the crime problem inasmuch as criminals will have nobody to go after except each other.
The police union rep, whose people ultimately had to absorb the deferral of a week’s pay and some comp days until retirement, and a 10 month delay in their next 2.75% raise, remarked on his latest clean getaway with characteristic grace:
It would be "difficult" to ask union members to sacrifice any more, he said.
"If they come knocking on our door next year, the door's shut," …
There's no question that the police do difficult and dangerous work and should be compensated accordingly, but as Chris Christie pointed out recently economic realities are economic realities and no one – certainly not public servants – should be immune to their effects.
Policeman: "With a 2% cap on a raise per year, how am I going to afford $8,000 to pay for medical benefits?"
Christie: "You're not. You're not gonna afford it. What's gonna to happen is you're gonna have to make choices among medical plans. And have more choices than just 3 choices which you have now, and only the Cadillac plan. You're going to have to make choices, like everybody else is making choices in this economy. [...]
"A whole bunch of politicians who came before me on the local level and the state level made you promises that they couldn't keep. And they knew they couldn't keep them when they made them. So, I understand you being angry. But I suggest to you, respectfully, don't be angry at the first guy who told you the truth."
Jeff Jacoby in his post What public-sector unions have wrought enumerates four advantages public sector unions have over their private counterparts when it comes to negotiating salaries and benefits:
 unlike their counterparts in the private sector, government unions are largely free from market discipline … The government agencies they bargain with don't have to make a profit or retain customer loyalty; they can't go out of business or relocate to another state. And, of course, their revenue is acquired the old-fashioned way: through the compulsion of taxpayers. ...
 [Strikes]: Because government services tend to be legal monopolies, a strike by police, garbage collectors, teachers, or air-traffic controllers inflicts pain on the public at large. ...
 … in public-sector collective bargaining, labor and management frequently both stand to benefit from higher wages and more munificent retirement income. ...
[From the Sacramento Bee]: "Managers also dominate the $100,000 club list. … If rank-and-file workers get a wage or benefit boost, non-union managers get a commensurate hike and a matching pension benefit."
The absence of that check and balance in the public sector has often transformed collective bargaining into something closer to collusion than to hardheaded haggling. ...
 more significant than any of these: government labor unions can reward politicians who give them what they want and punish those who don't. ...
The inevitable consequence of all of this is an escalating cycle of salaries and benefits completely detached from market realities or even common sense. Such a system begs to be abused, gamed and manipulated. What follows is an admittedly incomplete list of some standout games and gamers. Some of it is pretty amusing until you realize it's your money.
6. Is A City Manager Worth $800,000?
Last July the LA Times asked what one would hope would be a rhetorical question: Is A City Manager Worth $800,000?
It would appear that Robert Rizzo, City Manager of Bell, California, certainly thought so. When it emerged that he was making $787,637 to manage a city of 37,000, described as "one of the poorest cities in Los Angeles County," his explanation was forthright:
"If that's a number people choke on, maybe I'm in the wrong business," he said. "I could go into private business and make that money. This council has compensated me for the job I've done."
He might have added, "and it's not like I'm all alone here at the trough!"
In addition to the $787,637 salary of Chief Administrative Officer Robert Rizzo, Bell pays Police Chief Randy Adams $457,000 a year, about 50% more than Los Angeles Police Chief Charlie Beck or Los Angeles County Sheriff Lee Baca and more than double New York City's police commissioner. Assistant City Manager Angela Spaccia makes $376,288 annually, more than most city managers.
Unhappily for Mr. Rizzo's constituents agreed that perhaps he was in the wrong business and forced him to resign shortly thereafter. Bad news got worse when Los Angeles County filed charges against Rizzo and seven of his confederates, alleging that they misappropriated $5.5 million in public funds. In a masterpiece of understatement the Assistant District Attorney referred to it as "corruption on steroids."
When last seen, Robert Rizzo had just lost his volunteer parking lot attendant job at the International Surfing Museum in Huntington Beach, apparently lined up to earn community service hours for a DUI conviction. (There are some things you just can't make up.) No word if he'd suggested to the big Museum Kahuna that if he couldn't get a six figure raise he must be in the wrong business.
5. Triple Dipping – No Longer Just a First Lady Nutrition Issue
One of the great perks of having a government job is a retirement that isn't. Public servants can often retire at an early age on a pension representing up to 90% of their final salary:
Though the details of formulas differ, virtually all public employees receiving pensions in the state receive them on the basis of the number of years they worked, a certain retirement age, and a percentage of final or highest salary. For example, sworn police and fire officers often receive 3 percent of their final salary times the number of years they worked starting at age 50 up to a maximum of 90 percent of their salary. So, if an individual became a police officer at age 20, he or she would be eligible to retire at age 50 with an annual pension of 90 percent of final salary with annual cost of living adjustments thereafter. If the officer’s final salary were $100,000, the annual pension would start at $90,000.
Some of these employees return to government work – often in the same section or department they just retired from – and collect a second salary, usually for doing the same job or at least a variation of the same job. This is called "double dipping."
Not to be outdone there are even some enterprising retirees who manage to triple dip:
[In 2008] George Philip has won the state's triple crown of compensation.
The triple dipper took in $641,000 in 2008 from three state coffers: his $261,000 pension as the former chief of the teachers retirement fund, his $280,000 salary as president of SUNY-Albany and $100,000 as a consultant at his former workplace.
Philip, 62, gets to live rent free in the "president's residence" on campus and to use a 2004 Toyota Avalon "for official university business."
His huge pension stems from working 37 years for the state's other major pension fund, the New York State Teachers' Retirement System.
Philip's salary at retirement was $379,600 a year, a combined paycheck for performing two jobs simultaneously for 12 years -- executive director and chief investment officer.
If anyone out there knows of gainful employment paying in the $180,000 range that only requires half my time please contact me at once.
4. Triple-dipping Deux: Throw In a Lump Sum
Just because there is no plausible opportunity (even by the highly relaxed standards of public employment) to leverage or invent three jobs doesn't mean you can't make the most of other options. Consider the former Phoenix chief of police Jack Harris.
Some public service contracts provide for lump sum payouts on retirement to reimburse sick time, vacation and any other benefits. Harris received a one-time payment of $562,000 on retirement and an annual pension of $90,000.
MSNBC (I know, who woulda thunk it) picks up the narrative from there:
Two weeks later, the city rehired him as its “public safety manager” – critics say he’s doing exactly the same job -- at a base salary of $193,000 per year. While it’s common around the country for police officers and other government workers to retire, collect their pension and keep working, the state of Arizona passed a law specifically banning the practice earlier this decade. Conservative think tank Judicial Watch has filed a lawsuit in Maricopa County on behalf of a local resident, alleging the Harris is breaking this law.
“It appears that the senior law enforcement official in the city is gaming the system,” said Judicial Watch’s Christopher Farrell. “That is deeply corrosive to the whole sense of the rule of law.” Farrell said he doesn’t spite Harris his pension, but both the end-run of state law and the high salary – particularly at a time when Phoenix police were threatened with hundreds of layoffs – are egregious, Farrell said. “It’s a gag reflex kind of thing.”
3. Rubber Roomie
Before unionization one of the great selling points of being employed in the public-sector was job security. The standard mantra was while salaries might be somewhat lower government jobs were insulated from the vicissitudes of the economy and sufficiently bureaucratized that the dismissal process was cumbersome, lengthy and rare.
Now that the unions have had an opportunity to work their will we have the best of both worlds: public-sector employees now enjoy salary and benefits well in excess of their private counterparts and it is well-nigh impossible to fire them.
One of the most egregious outworkings of this are the now famous "rubber rooms" – more formally known as Temporary Reassignment Centers – in which teachers who have been accused of misconduct or incompetence, but cannot be fired (or whose cases have congealed somewhere in the system which is effectively the same thing), receive full salary for essentially doing nothing.
"To me the thing that's most shocking ... is how long people can spend there. You can spend five years or ten years-- a decade in the rubber room at full salary."
Well, more than 10 years as it turns out. Roland Pierre, a 75-year-old teacher (yeah I know, that's past the age of retirement) accused of sexual molestation of the pupil has spent 13 years in a rubber room at full pay.
Pierre was permanently removed from the classroom in 1997 after he was accused of sexually molesting a sixth-grade girl at PS 138 in Brooklyn.
But since then, Pierre has continued to receive full pay and fringe benefits, including health, pension and vacation, officials said. He pulls down $97,101 a year.
The DOE has no required retirement age. Hired in 1986, Pierre could have retired at age 62. At his age, he can collect Social Security as well as his full salary, so his income may be close to $125,000 a year, sources said.
2. Disability Leave – It Only Hurts When I Flex
Many jurisdictions provide for early retirement (sometimes with enhanced benefits) for public employees who have been injured on the job. Like many such provisions this sounds perfectly reasonable; what fair-minded person would deny a police officer wounded in the line of duty proper compensation for the rest of his life? The devil of course is in the details.
To be fairly and efficiently applied a rule like a disability provision requires a reasonable definition of "disability," and equally reasonable definition of "job-related" and adequate accountability and oversight. You would think such things would be self-evident to governments and administrators – and you would be wrong.
Often these "disabilities" have nothing to do with public service. In Nevada, for instance, state law decrees that heart disease among police officers and firefighters is to be considered a work-related disability—even if it is actually due to poor diet, lack of exercise, or genes.
Loose disability rules are also an invitation to fraud. The Sacramento Bee reported a few years ago that as California Highway Patrol officers approached the end of their careers, they "routinely pursued disability claims" in order to qualify for fattened pensions—at one point, the share of CHP officers retiring as disabled was more than 80 percent—whereupon some of them "embarked on rigorous second careers."
My personal favorite in the "rigorous second career" category is the story of Albert Arroyo, a Boston firefighter who took disability leave after he tripped on a staircase.
He reported falling … and suffering a back injury so severe that, a few weeks later, his doctor wrote that Arroyo should be granted an accidental disability retirement because he is "totally and permanently disabled."
To be fair, the doctor didn't specify that this would prevent Arroyo from competing in bodybuilding events, although to a layman this would seem a reasonable assumption.
Not so. Arroyo not only competed in the Pro Natural American Championships – that very same year – but he came in eighth! (Video here.)
Arroyo’s lawyer, who presumably has the same doctor, offered the following insight in his defense:
A lawyer representing Arroyo has said that bodybuilding was good for his back injury.
Yup, I know what my back is out nothing is more helpful than bench pressing a small Buick.
Arroyo, ordered back to work when this story broke, disappeared for a while. For a concise and almost poignant illustration of the term "befuddled" please see the video below.
There may actually be more cleverness in this than meets the eye. By virtue of thinking he would actually get away with this Arroyo may be eligible for early retirement on the grounds of mental incompetence.
1. Talking Trash – NYC Sanitation Workers, Quick to Anger, Slow to Remove Snow
Garbage collectors in New York City currently make $144,000 in salary and benefits.
Taxpayers in the Big Apple are forced to pay $144,000 a year for salary, health and pension benefits for garbage workers, who are unskilled but unionized laborers.
Research by the Manhattan Institute, a think tank in New York, shows that when Mayor Michael Bloomberg took office after 9/11 the city increased spending on garbage workers' salaries by three and a half times the rate of inflation every year, growing the sanitation department budget from $1.3 billion a year to $2.2 billion.
Their boss, John Doherty, makes $205,180 plus benefits, which evidently includes having your street plowed while surrounding blocks remain untouched.
And thereby hangs a tale.
One of the biggest stories in the Northeast after unusually heavy snow falls in late December was the painfully slow pace of snow removal in New York City. It later emerged that this was the result of a deliberate slowdown in protest of 6 percent staff reduction in the past two years, along with demotions for 100 supervisors.
It never seems to have occurred to anyone that if you're paying garbage collectors just south of $150,000 a year, and you're unwilling or unable to bring salaries and benefits like that into some kind of rational alignment with the universe, the only solution in the face of shrinking revenues is just that kind of a staff reduction. Instead, these deep thinkers concluded that the solution was to inflict as much misery on New York City residents as possible.
Selfish Sanitation Department bosses from the snow-slammed outer boroughs ordered their drivers to snarl the blizzard cleanup to protest budget cuts -- a disastrous move that turned streets into a minefield for emergency-services vehicles,
"They sent a message to the rest of the city that these particular labor issues are more important," said City Councilman Dan Halloran (R-Queens), who was visited yesterday by a group of guilt-ridden sanitation workers who confessed the shameless plot.
The snitches "didn't want to be identified because they were afraid of retaliation," ... "They were told [by supervisors] to take off routes [and] not do the plowing of some of the major arteries in a timely manner. They were told to make the mayor pay for the layoffs, the reductions in rank for the supervisors, shrinking the rolls of the rank-and-file."
New York's Strongest used a variety of tactics to drag out the plowing process -- and pad overtime checks -- which included keeping plows slightly higher than the roadways and skipping over streets along their routes, the sources said.
The snow-removal snitches said they were told to keep their plows off most streets and to wait for orders before attacking the accumulating piles of snow.
The "message" the federal and state governments might be sending back to the union is "you're under arrest" as they launch criminal probes into the role the slowdown may have had in deaths occurring when emergency vehicles could not reach people during the blizzard.
The US Attorney's Office in Brooklyn and the Brooklyn District Attorney's Office have each launched criminal probes focused in part on where people died in the massive blizzard -- and if they were along the routes of plowmen who allegedly were told to slow down the cleanup, several sources said.
The feds "will examine the failure of the public safety and uniform [workers]. If any of the deaths are attributable to willful failure to perform their jobs, charges can be brought," said one source.
Conclusion: Maybe It Isn't So Darned Funny After All
It’s worth noting that the excesses of double-dipping, rubber rooms, disability claims and lavish (and often highly inventive) compensation schemes listed here are only a few examples of a much larger, and thoroughly systemic problem. There are whole websites (like the aptly named pensiontsunami.com) devoted to such abuses and the economic time-bomb they represent.
Even if we dismiss the Robert Rizzo’s and Roland Pierre’s as outliers (and I’m not sure even that would be an easy case to make) the larger problem persists. Local governments have been capitulating to, and colluding with, public service unions for decades. Salaries and pensions are out of line with any semblance of economic reality and, as we have seen in the Camden New Jersey exercise, the standard expedients of procrastination and/or punishing taxation won't work much longer as cities become insolvent.
Arguments from government workers – who are not the villains here – as to what’s “fair” yield little, since in the economic realm this quickly becomes subjective, emotional and ultimately intractable. Free markets, when not bound up in layers of complicated, expensive and wholly ineffective government regulation do quite well at setting the price of labor at any given time. As long as public sector compensation is politicized and detached from the very economic forces that make that happen we will continue to find ourselves scratching our heads and asking, quite unnecessarily, if a garbage collector is worth $144,000 a year.
(Cross-posted at NewsReal Blog.)