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Outside editorial: Federal pay freeze a small step toward budget sanity

Posted: Thursday, December 02, 2010

The following editorial appeared in the San Jose Mercury News:

President Barack Obama's proposal for a two-year wage freeze for civilian federal workers is an important act of leadership. It sets the tone for cost-cutting that still needs to take place in state and local governments across the nation - certainly in California - while reinforcing the president's commitment to sensible spending controls.

This is not a radical proposal. If Congress approves it, the freeze cancels modest pay raises. That's minor compared with the sacrifices of some other public employees and barely a hint of what many private-sector workers have endured.

The $2 billion it would save this fiscal year is small potatoes in light of the $1.3 trillion deficit, leading some on the left to call it a gimmick. It's not: Over 10 years, because of compounding, it saves $60 billion.

The reality is, it's going to take a whole bunch of small-potato moves to get control of the deficit. Obama has made many others, including freezing non-security discretionary spending and White House salaries, angering some allies in the process. There is no acceptable way to balance the budget in one fell swoop.

For cities like San Jose, which will be asking for more concessions to avoid massive layoffs in June, the federal example is powerful. It's harder to make the debate personal, as factions in San Jose seem to do, when the need for cuts is so clear nationally.

It's unfortunate that the brunt of this wage freeze falls on 2.1 million middle-class Americans. Obama's announcement Monday included an elegant homage to their hard work: "They're doctors and nurses who care for our veterans. Scientists who search for better treatments and cures. Men and women who care for our national parks and secure our borders and our skies."

While the freeze is good policy, its critics are right about one thing. It's another example of middle-class losses while the rich grow richer. Whether through tax policy or other avenues, Obama must hold out for a long-term deficit-reduction plan that spreads the pain across all income levels. Failure to do that will only lead to further economic instability and decline.



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