Is A $4700 Pay Raise Justified?
By Bob Steiner
For those of you not in the know,  the U.S. Congress has just given itself a pay raise. Through December 31st the average congressional  pay was just under $170,000. Effective January 1st this amount has been raised to $174,700, an increase of $4700.  It should also be noted that our elected representatives are also eligible to other funds through the generous expense accounts that go with working on Capitol Hill. I know the cost of living in the District of Columbia is high, but at this time I believe some discussion on the overall compensation paid out to these elected officials is in the public interest.
Ostensibly, this recent increase was an “automatic” cost of living adjustment, which the government computers factor in each year based on various economic information. Still, at a time when I see a major employer closing in Moriarty, retail stores, and automobile plants shutting their doors, I find the “timing” of this increase to be in particularly bad taste. When asked about this raise, I know our legislators will say they really had no choice on the matter. “The Computer did it.” So what can they do? I might suggest that each “person” could donate the amount of his/her raise back to one of the welfare organizations in our area. I am quite skeptical in believing that this will actually happen. Still, I think this would be the “right” thing to do, especially in view of the economic turmoil we are experiencing at this time. On the other hand, perhaps I am being too cynical. Just maybe our elected “persons” have been working hard for their constituents and actually merit an increase in pay. Let’s take just a few minutes and try to review some of the political “successes” of the past few years. Since it seems to be one of the major issues of our daily lives, just what has the congress done to improve the economy?
We were repeatedly reassured by Congressional Representatives, Barney Frank (chairman of the House Financial Services Committee), Maxine Waters, and Senator Schumer, that “Fannie Mae” and “Freddie Mac” were financially solvent and there were no problems (this as late as September 08). We later found out that due to the elimination of regulatory guidelines to promote “marginal” loans, these agencies had major problems (including potential fraudulent activity by one of the directors), and had to be bailed out by congress. The irregularities uncovered during the investigations of these two agencies seem to have then precipitated the failure of  various banking and financial firms which had relied on the backing of Fannie Mae and Freddie Mac in support of many real estate transactions. This, in turn,  created havoc for the real estate industry, as well as huge monetary losses.  Subsequently, Wall Street reacted to these financial “indicators” and the bottom proceeded to drop out of the stock market, bringing us to the present economic chaos we now have. Lest we forget, Senator Chris Dodd was given a preferential real estate loan by Countrywide. Of course, I am certain his position as Chairman of the Senate Banking and Housing Committee had nothing to do with his having been given this special treatment.
We must also not lose sight of the actions (or inaction?) of the congressional leaders, Senator Reid and Mrs. Pelosi. As the dominant leaders of the two legislative bodies, they must accept their responsibility for failing to exercise good supervision and control of their subordinates. We certainly don’t want the other party to come away unscathed, either. While the Republicans have been in a minority for several years, they were represented  on all the pertinent committees and would have had to had some advance knowledge of what was to happen. While they didn’t have the “votes” to control the situation, they did have “voices” and these were silent!  Shame on them, as well!
In view of the above, it would seem that our congress has not necessarily done the best job in looking out for the best interests of the people, at least in the areas I have addressed in this article. It almost seems that Congress has failed us and is directly responsible for the current economic situation. It is too bad that we can’t hold them more accountable for their actions. If you are concerned, as well, perhaps the questions I have raised are valid. So, I ask one more time. Is a $4700 pay raise justified?
5 Responses “Is A $4700 Pay Raise Justified?”
Wouldn’t you like to work a deal for yourself anywhere near what congress has managed for both houses.
Perhaps I’m wrong about this, but I think I’m beginning to sense a pattern here with which, as editor, I’m a little uncomfortable. I want to be very clear that I would prefer that NM-Central not become a vehicle for partisan political argument. This article strongly implies that one political party – the Democratic Party – is primarily responsible for the demise of the financial services sector. This is simply not the case. The influences that led to the current situation first became operative many years ago, and include among them a relentless pursuit of a philosophy of deregulation and insistence that “market forces” represent the best method of control – not just for the financial sector, but for most systems. This philosophy is certainly not the exclusive territory of the Democratic Party.
Further, while it is easy to point out a lack of success on the part of the current Congressional leadership and cite examples of current and recent alleged misconduct on the part of a few Democrats, it is important to note that the Democrats have held a slim lead in Congress for all of two years. The Republican party held a majority for the prior twelve – six of them with a Republican president in office.
While a number of key Democrats have apparently placed themselves in positions that have the appearance of a conflict of interest, and others opposed increased regulation of Fannie Mae in the late 1990s and since, there are a number of other factors that contributed, both within and without the regulatory framework. Predatory lending practices should not be ignored, nor should irresponsible borrowing. The lack of an appropriate regulatory framework is certainly a major factor. Inadequate understanding of the financial system on the part of lawmakers – both parties – would appear to be a major contributor to the problem, and of course the outrageous prevalence of influence-peddling in Washington and elsewhere is part of “all of the above.”
As for the pay raise, it amounts to about 2.7% This doesn’t seem outrageous in and of itself – although I’ve long held that Congress should get the same percentage of annual increase as minimum wage earners. Depending on whether this applies only to the House or to both the House and Senate, we’re looking at expenditures of about $2,044,500 and $2,514,500 to fund the raise – not much in the scheme of things, really.
When times are tough, it is not unheard of that resentment arises against those who seem to be doing better than most. Let’s remember that people in Congress generally have to maintain an additional residence in Washington, and spend a substantial amount of their lives away from home. $174,700 may seem like a lot of money, and may even BE a lot of money, but is it unreasonable given the demands of the position? I would submit that it is not.
Sorry John. You missed the boat (and the intent of the article). The impact of what our representatives do in Washington is having an effect on “our local economy”!!!! We must hold all of them (Democrats and Republicans) accountable for what is happening to our local community. Suggest you go spend some time at”Bethel Storehouse” in Moriarty and see the families coming in for assistance (I Have!). Politics just might be a “local issue”!
By the way, I do enjoy your “gardening” articles.
Bob
Dear John Weckerle,
I personally find your thinking that an expenditure of $2,044,500 & $2,044,500 to raise in salary for Congress (to quoate you) ‘not much in the scheme of things’ ludicrrous. When we talk about millions of dollars today and make it sound not significant because our government is now talking about trillions, then we should all step back and take another look. Politics beside, there is blame enough for all. But you and I have to pay our bills and stay within a budget and the government should be required to do the same. If there is a deficit, we should all tighten our belts and cut spending everywhere. You can not justify that $4,700 raise by saying they will need it with all of their expenses. I’m sorry but this does not make sense any way you want to justify it.
Catherine Long
Catherine,
Thanks for your comments! We’re probably not going to agree on every point of this issue, but we agree on much. It is true that, over the last eight years, we have gone from a budget surplus to a nearly unbelievable budget deficit, and that measures must be taken to reverse the trend. I am hoping that the incoming administration will look at the forces that led us to this point and make changes that will get the nation’s finances back on track. I concur, also, that it is past time to look at expenditures, large and small, and figure out which should stay and which should go. However, I maintain that the Congressional pay raise is relatively small and, other than its obvious symbolic significance to some, does not represent significant contributor to the national deficit a the current financial condition of the government. While many of us are not happy with the way things have gone in Washington, many of the people who work in Congress work very hard. This is essentially a cost-of-living adjustment (if it was enough to be considered a merit raise, I’d be thinking very differently) and, when the expenses involved with doing the job are considered, I don’t find it outrageous, especially given the fact that it was a preprogrammed increase. While I think it important to consider the appropriateness of all expenditures, I also think it important to focus on issues that make a difference in the context of the big picture; in short, I’m more concerned about the money they’re spending than this pay raise.