The high cost of mistreating the federal civil service

A lesson to learn from

Sometimes the forced brevity of Twitter has very good results. Harold Pollack (@haroldpollack, for those of you keeping score at home) put up a Tweet a few days ago that expresses an important and under-appreciated truth in 140 characters:

Next time federal gov fails to execute something important w/technical proficiency, I hope we remember nickel+diming employee benefits+pay.

The federal civil service is, by and large, both honest and competent. That makes a bigger difference to the quality of life in this country than anyone who hasn’t been close to the process could possibly grasp. (Yes, there’s always inefficiency and bad decision-making that goes with bureaucracy, whether public or private. But when the people involved are dumb or crooked or just seriously bored, really, really terrible things happen. Ask anyone who has to do business with, for example, Louisiana state government or the city government of Providence.)

But that honesty and competence are largely a legacy of the era that started with the New Deal and ended with Watergate. Pay, benefits, and working conditions at the top of the civil service simply haven’t kept pace with private-sector pay, or with the cost of living in lobbyist-dominated Washington, D.C. A GS-15, Step 10 – someone with at least 20 years of service and substantial responsiblity – makes less than a first-year associate, fresh out of law school, at a top law firm, or a fresh MBA at a top consulting firm. (Further up the chain, any law or economics professor who would be seriously considered for a judgeship or cabinet post would have to take a substantial pay cut to accept it.)

Worse, LBJ was perhaps the last President who understood, deep in his bones, that one of the President’s key jobs is to be the leader of the career civil servants, and that when the political leadership reaches treats the career folks as partners rather than peasants great things can happen. Starting with Nixon (with GHWB as a partial exception) we’ve had Presidents who distrusted – sometimes actively hated – the people who actually do the work, and were happy to go along with faux-populist efforts to make their lives worse, in ways great and small. Pay has been cut in real-dollar terms; the once-generous federal pension system has been dismantled; offices have gotten smaller; and travel has been made as difficult and uncomfortable as possible. The “muffingate” rules about food and drink at meetings and conferences just added insult to injury.

The latest budget deal once again sticks it to federal workers: another pay freeze, plus increased pension contributions. And as far as I can tell, neither the President nor anyone around him has even said “I’m sorry about this” to the people getting the shaft.

Not only does this mean decreasing technical competence, as Harold notes. It also means that the banks, the pharmaceutical companies, the energy companies, the telecos, and all the polluting industries can easily run rings around the folks trying to regulate them.

Of course I can understand why the Tea Party crowd and the plutocrats hate civil servants. But the failure of Democratic Presidents and legislators to stand up for them is almost inexplicable except in terms of political cowardice. (Part of the problem is that Congress doesn’t want either to raise its own pay or to let civil servants earn more than Solons.) And unfortunately, too many progressives outside of government, especially those struggling in ill-paid journalistic or academic or social-serivce venues, can’t find any sympathy with bureaucrats who are paid better than they are. But the cost of all this in terms of the capacity of the federal government to make progressive policy work is enormous. You’d hope that might serve as an object lesson, but so far I don’t see much evidence that anyone except Harold is drawing the right conclusion.



Author: Mark Kleiman

Professor of Public Policy at the NYU Marron Institute for Urban Management and editor of the Journal of Drug Policy Analysis. Teaches about the methods of policy analysis about drug abuse control and crime control policy, working out the implications of two principles: that swift and certain sanctions don't have to be severe to be effective, and that well-designed threats usually don't have to be carried out. Books: Drugs and Drug Policy: What Everyone Needs to Know (with Jonathan Caulkins and Angela Hawken) When Brute Force Fails: How to Have Less Crime and Less Punishment (Princeton, 2009; named one of the "books of the year" by The Economist Against Excess: Drug Policy for Results (Basic, 1993) Marijuana: Costs of Abuse, Costs of Control (Greenwood, 1989) UCLA Homepage Curriculum Vitae Contact:

31 thoughts on “The high cost of mistreating the federal civil service”

  1. Amen. With a PhD in a quantitative social science, which I hope someday to have, I could:

    A) be a professor, and do what I love (teaching and research), even if the pay isn’t necessarily great;
    B) go work for a private firm in appealing places like Silicon Valley/Bay Area, NYC, or elsewhere putting my technical skills to use for possibly as much as six-figure pay; or
    C) work for the federal government, where (diminishing, but still fairly high) job security and (diminishing, but still fairly good) benefits are theoretically supposed to make up for mediocre pay, pointless busywork mandated by Congress and administrative regulations, and a messy bureaucracy.

    Even though I believe in the project of competent administration of progressive public policy, it seems like it would be difficult to choose C.

    1. “Even though I believe in the project of competent administration of progressive public policy, it seems like it would be difficult to choose C.”

      And that’s before having children, and before having – well, the GOP – f*ck up the Civil Service even more.

  2. Mark,

    Agree with the main thrust of your post. A few quibbles/thoughts:

    1. Are the hits to pensions happening to defined-contribution versus defined-benefit, or both? The later has been withering for awhile; I would not be opposed to them skimming down the latter for new employees if they boosted the former. Yes, there are a host of problems with defined-benefit, but there is too with defined-contribution…

    2. Nixon may have disdained a lot of the civil service, but from what I have read, he was very solicitious with the EPA; under Nixon, it was the agency’s “golden age”.

    3. It is not just the progressive community who resents the civil service. The public resents them in general for their benefits and job security. Never underestimate Nietchze’s resentmannt.


    1. Hear hear.

      Nixon sure looks better and better in hindsight; it looks like our tolerance of corruption is vastly increased by exposure to it. We now expect corruption and incompetence, and we get what we expect. Of course, Nixon’s EPA excellence was sparked by things like the actual Cuyahoga River catching on *fire.* The water and air pollution was obvious.

    2. A couple of responses…

      Federal workers have a defined benefit pension (one percent of salary for each year of service, basically) and a defined-contribution pension (which is basically like a 401(k), though it’s not technically the same thing). Neither of the BENEFITS is being changed. Instead, feds are going to pay more out of their paychecks to get the same defined benefit pension–it was 8/10 of a percent deducted from our paychecks, now it’s going to be two percent or something like that. So this is basically pay cut to federal workers–on top of three years of pay freezes. It’s not the end of the world, but it is the constant whittling away, the nickle and diming, that adds up over time to “Gee! We can’t get or keep quality people in the civil service!”

      Now, I’m going to be very blunt on your, frankly, completely baffling observation that you “would not be opposed to them skimming down [defined benefit]…if they boosted [defined contribution]….” Yeah, well, I wouldn’t mind the pay cut if they also gave me a pay raise. So what? That’s not in the mix. It’s a pay cut, pure and simple. The only one being skimmed is me, every two weeks when I have less pay to deposit. I work damn hard–for you, as it happens–and I very much resent having the terms of my employment altered to my detriment. Precisely because, as with many federal workers, I made a careful choice to swap riches in the moment for security and a good pension–as well as the chance to do something worthwhile for the public. Most of us don’t expect hymns to be sung in our honor, but the constant and casual abuse does get a bit old.

      1. Criag,

        Thanks for explaing the de-facto pay-cut. That is petty to be sure and sucks on the receiving end…

        I don’t think my comment is that baffling in terms of the context of Mark’s comment. The defined benefit pension wasn’t dismantled and left with nothing, as implied by Mark, it was reduced and replaced in half with a 401(k)-like system. My comment was more like, “If my hypothesis was in the mix, would it be that awful?” I think for lifers at the Feds that can’t get termed, it may not be as good. But for those who one day may want to do something else than work for the Feds, it would be a better deal…

        Hey, I respect Federal sevice (I used to be in it), although I was in an office that was just awful, filled with staff that made up nonesense for an OIG (like the old Soviet saying, “We pretend to work and they pretend to pay us”). I don’t take that experience and bad-mouth all Federal employees, or think they are all rotten. I don’t even agree with the de-facto pay cuts occuring. But I can ask a hypothetical question to something that was not expressed fully accurately by Mark…

        Again, thanks for clarifying the de-facto pay-cut.


  3. With the benefit of almost 15 years of distance, I can now chuckle at some of the petty nonsense I put up with during my tenure at IRS Chief Counsel, but at the time it really pissed me off. Did somebody actually think that my judgment could be swayed by a Danish?

    1. Let me play devil’s advocate for a moment. You ever see all those pens and notepads and stuff that the drug reps bring around to doctors’ offices? Do the drug companies actually think that a doctor’s judgment could be swayed by a ball point pen?

      The answer is yes, they do.

      Just worth a moment’s consideration.

  4. Speaking as someone whose family took a pay cut from academia for senior public service, C gets harder and harder to choose. And that’s not accidental among the people who like to buy policy.

    The other side of this, of course, is the contractor thing, where public expertise gets hollowed out or simply destroyed by placing so much of the operational (and policy-determining) jobs in the private sector. Even if public employees aren’t being nickel-and-dimed to death, they’re only barely in a position to supervise anything complicated and make sure it gets done properly. And when getting something done for the public involves relying on the kindness of strangers, well.

    1. I should also add that I have some experience with contracting, and it is pretty much the worst of both worlds unless you work for an agency with an extremely large budget. You aren’t really being paid much if any better than your government counterparts, unless you are making it rain for the company, and you also have no job security, poorer benefits, and typically work longer hours. Meanwhile your government clients have unrealistic expectations about efficiency and feasibility, and essentially have veto power over any analysis that doesn’t come out the way they’d like. Meanwhile, as you said, this is hollowing out the public sector and making it less efficient and effective, all for what is, as best I can tell, not much of a savings.

  5. Pay, benefits, and working conditions at the top of the civil service simply haven’t kept pace with private-sector pay

    This is true; however, pay benefits, and working conditions at the lower levels of the Civil Service have gotten hugely better relative to private-sector pay. I’m not quite certain that “pay GS-13 and above more, and pay for it by paying GS-12 and below less” would be acclaimed by progressives.

    1. You’re right. We care about equality as well as quality. How about “pay all civil servants competitively, and make up for it with less contracting-out”?

      1. I’ll buy Mark’s notion of competitive pay, but competitive pay isn’t equal pay. At the lower levels, the better job security is worth something. At the higher levels of the civil service, the psychic income is quite real, and increases with responsibility. Civil service pay can be quite competitive without being at private sector levels.

        Which brings up another point–possibly more applicable to state and local civil service than federal. Many civil servants–especially front-line types like cops and teachers–are heavily back-end compensated. This hides their pay, keeps the journos and voters happy, and projects a general Uriah Heep ‘numble, ‘numble image. (Did you notice that any time a civil servant gets in trouble, the journos invariably mention their salary?) Pensions are high, sometimes absurdly so, and starting pay is particularly derisory.

        1. Those “absurdly high pensions” almost always pertain to state and local workers who do not receive Social Security. I’m personally very grateful that the federal workforce started paying into Social Security back in the 80’s, because every time a city or a state government gets into financial trouble, we keep hearing about these “lavish” pensions that go to Detroit firefighters or whatever, from people who either do not know or do not care that those coddled first responders aren’t entitled to the Social Security check that “everyone” gets.

          1. …leaving aside the more fundamental question of whether any pension can be “absurdly high” when it was part of THE DEAL from day one that a public servant wouldn’t make much money in salary, but we’d take care of them in old age…

          2. It was part of the deal–and as long as there is ability to pay, a deal is a deal. But the deal was made to hide the true economics from the taxpayers: a conspiracy of the city employees and the city managers against the taxpayers. Call me a miserly wretch, but I just happen to prefer transparency to hiding out-year costs.

      2. How about “pay all civil servants competitively, and make up for it with less contracting-out”?

        I would not be in favor, because “competitively” at the lower levels of the civil service would be less than half of current (total) compensation; to be blunt, I like having DMV workers who are better paid and more secure than Wal-Mart workers.

      3. Following up my above: this afternoon I had to go to the city to get a permit; I’m moving, and wanted to put a POD in a street parking space. I went in to city hall, asked the woman at the info desk, she told me which office to go to. I went there, waited maybe 5 minutes, an employee told me which person I needed to talk to. He talked to me, gave me the paperwork, told me that PODS has their insurance on file and looked it up and filled in that portion of the form for me. He said “you need a sketch, but I can draw that”, looked up my house on Google maps and sent me over to the cashier to pay. I brought him back the receipt, and he said “we can mail you the permit if that works.”

        Everyone was competent; everyone was polite; and they went out of their way to be helpful. That’s worth something, even though these aren’t policy-makers or supervisors.

    2. “This is true; however, pay benefits, and working conditions at the lower levels of the Civil Service have gotten hugely better relative to private-sector pay.”

      This has been covered elsewhere; the lower-skilled Civil Service positions have been cut sharply compared to decades ago. Those jobs are the most likely to have been outsourced.

  6. What Mark says. Especially the bipartisan nature of mistreating the civil service. I have a few things to add:
    1. The civil service–at least the more elite parts of the civil service, such as Justice–now relies on the revolving door to staff up with good people. Kids come in to get training and credentials, and then leave. They whirl in again at mid-level (maybe), and then again at a very senior level (if they’re lucky.) The problems of the revolving door are subtle, but real. As a general rule, the better people aren’t lifers (with exceptions). The lifers fall into several categories: the mediocre, those with well-to-do spouses, the ideologues, and a few good people who are too cussed to respond to incentives. The mid-level and most senior revolvers are genuine in their commitment to public service, but they see the world most naturally through industry eyes. It is a good idea to have some people who can do this, but there are too many.
    2. Journos have been a villain, as well as Presidents. They have a very mechanistic conception of conflicts of interest, in which a bureaucrat can sell their soul for a Danish. They are similarly mechanistic on the revolving door. They equate the ambiguous revolving door of–say the NIH or SEC–with the utterly pernicious revolving door of procurement officials. They are generally too damn lazy (or perhaps snobbish) to cultivate the GS-15s, who know the agency better than the Presidential appointees, and are a lot less likely to spout official bullshit if you can get them to talk.
    3. What Paul said about contracting.
    4. The lower levels of the civil service are now better gigs than the corresponding levels of the private sector: better pay, better security, better bennies, better everything. (It used to be that their pay was worse than the private sector, but the plutocrats have taken care of this.) This fuels the ressentiment to which Frank refers. The upper levels of the civil service–maybe GS-13 on up–have much worse pay.
    5. There are too many Presidential appointees. This creates all kinds of problems, including pressuring top civil servants to leave when their talent is clearly greater than the SES can accommodate. These pressures are quite independent of salary concerns. Tim Geithner was an exception–he was so highly regarded in Treasury that he was promoted from the civil service to a Presidential level. This is, however, very very rare.

  7. This is nice. “But the failure of Democratic Presidents and legislators to stand up for them is almost inexplicable except in terms of political cowardice.”

    I don’t think it’s just that. It’s also the influence of the DLC ilk. Who are very much still with us, I’m sorry to say. The president can say nice things about inequality, but talk is cheap. The DP has been helping to sell out workers for decades now, it seems to me. We have glimmerings of an industrial policy, but mostly only to save the planet, imo. Actual people? Who cares?

    1. But in fact the lower ranks of the federal service seem to be reasonably compensated. It’s at the top that the passion for equality makes it hard to compete for top talent.

  8. Counterargument: A country needs its talent in the private sector (and paying taxes to support the government). If the government pays for talent equal to the private sector, then the country risks becoming the UK during its bad times. Brilliant, honest mandarins can’t offset a stagnant economy.

    1. Right. Things we absolutely do not need our “talent” doing: catching criminals, running courts, rescuing people from burning buildings, teaching children, defending the country, negotiating trade agreements, charting hurricanes…see? Not a Randian superhero in the bunch!

      1. Yes.

        For many reasons, pay in the public sector does not track the value – often quite high – of the public employee’s work.

    2. Is it really so zero-sum? Are there perhaps people who are having their time totally wasted in the positions available to them in private sector but would be accomplishing much more impressive things in the public sector?

    3. “Brilliant, honest mandarins can’t offset a stagnant economy.”

      Right-wing ‘trade-offs for growth’ arguments are pretty well debunked by now.

    4. Because the only problem the british ever had was smart people in the public sector, and their practice of having smart people in the private sector has been working out so well for them…

      Meanwhile, I think Ebenezer’s 1) only works for a couple of cycles. It’s not that bad if people filter out of government service and into the private sector because of prospects of advancement and such, and then come back later. But once people go into public service with the intent of burnishing a resume that will get them a good private sector job — and the big companies start thinking about the agencies that regulate them as a low-cost farm system — then you’ve set up incentives for only the rancid fat to rise to the top.

      There used to be a mostly-virtuous circle between industry, academia and government employment in the high-tech R&D world, but I don’t know how good a model that is or if it could in fact be reproduced.

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