By PETER BAKER
WASHINGTON — President Obama announced a two-year pay freeze for civilian federal workers on Monday as he sought to address concerns over sky-high deficit spending and appeal to Republican leaders to find a common approach to restoring the nation’s economic and fiscal health.
“The hard truth is that getting this deficit under control is going to require some broad sacrifice and that sacrifice must be shared by employees of the federal government,” Mr. Obama said at a White House news conference.
“I did not reach this decision easily,” he said. “This is not just a line item on a federal ledger. These are people’s lives.”
He called federal workers “patriots who love their country” but added that “I’m asking civil servants to do what they’ve always done” and sacrifice for the good of the nation.
The president’s proposal comes a day before he hosts Republican and Democratic Congressional leaders at the White House to begin mapping a way forward after midterm elections handed Republicans control of the House and six more seats in the Senate. The meeting, which was delayed when Republicans rebuffed Mr. Obama’s first proposed date, will be the first time since the midterms that the defeated Democrats and the triumphant Republicans sit down to figure out whether they can work together.
At the top of the agenda are the economy and federal spending, both prime targets of voter anger during the just-concluded campaign. Even before the new Congress takes office in January, the two sides must tackle such matters as whether to extend the Bush-era tax cuts that expire at the end of the year and whether to extend unemployment insurance payments that expire for many Americans as well.
The White House meeting also comes a day before a fiscal commission appointed by Mr. Obama is scheduled to issue its final report on how to curb deficit spending, a topic that has polarized Washington over questions about tax increases and entitlement benefit cuts.
Mr. Obama expressed optimism that the meeting with legislators would be a productive and fresh beginning. “My hope is starting today, we can begin a bipartisan conversation about our future,” he said. “Everybody’s going to have to cooperate. We can’t afford to fall back onto the same old ideologies or the same stale sound bites.”
The president’s proposed pay freeze would wipe out plans for a 1.4 percent across-the-board raise in 2011 for 2.1 million federal civilian employees, including those working at the Defense Department. But the freeze would not affect the nation’s uniformed military personnel. It would also mean no raise in 2012 for civilian employees.
The pay freeze will save $2 billion in the current fiscal year that ends in September 2011, $28 billion over five years and more than $60 billion over 10 years, according to Jeffrey Zients, deputy director of the Office of Management and Budget and the government’s chief performance officer. That represents just a tiny dent in a $1.3 trillion annual deficit but it offers a symbolic gesture toward public anger over unemployment, the anemic economic recovery and rising national debt.
Mr. Zients said the president made the announcement on Monday because of an approaching legal deadline for submitting a pay plan to Congress. But by doing it now, the president also effectively gets ahead of Republicans who have been talking about making such a move once they assume greater power in January. Some Republicans have gone further, proposing to slash federal worker salaries.
With Republicans vowing to make deep budget cuts, Mr. Obama must decide how far he is willing to go and where he will draw a line. He pointed out that he has already found $20 billion in savings from eliminating or scaling back unnecessary programs, identified $150 billion in improper payments and proposed selling $8 billion in unneeded federal buildings and land. “We believe it’s the first of many difficult steps ahead,” Mr. Zients said.
The federal workforce is an obvious first target, if one fraught with political risk for a president who relies on union support. Critics have said the federal workforce has been protected from the ravages of the economy. Chris Edwards of the Cato Institute referred to federal workers, in a study in June, as “an elite island of secure and high-paid workers, separated from the ocean of average American workers.”
Mr. Edwards found that federal civilian workers had an average annual wage of $81,258 in 2009, compared with $50,464 for the nation’s private-sector workers. Average federal salaries rose 58 percent from 2000 to 2009, compared with 30 percent in the private sector, according to his study.
Union leaders said Mr. Obama was playing politics at workers’ expense. “It’s a panic reaction,” John Gage, president of the American Federation of Government Employees, said in an interview. “It’s superficial. People in this country voted for jobs and income. Sticking it to a V.A. nurse and a Social Security worker is not the way to go.”
Mr. Gage said the notion that federal employees make too much money “is a myth,” especially in light of million-dollar bonuses paid to Wall Street executives who he said helped trigger the financial crisis that plunged the nation into recession. A typical border patrol officer makes $34,000 a year, a nursing assistant makes $27,000 and a mine inspector makes $38,000, Mr. Gage said. “We’re an easy scapegoat,” he said. “We weren’t the ones who got us into this fix.”
Republicans welcomed Mr. Obama’s announcement even as they criticized it as not aggressive enough.
“At a time when our nation’s seniors have been denied a cost-of-living increase and private sector hiring is stagnant, it is both necessary and quite frankly long overdue to institute a pay freeze for the federal workforce,” Representative Darrell Issa, a California Republican who is likely to become chairman of the House Oversight and Government Reform Committee, said in a statement.
This is not the first time Mr. Obama has addressed government pay to make a political point. He froze the salaries of his own top White House staff members when he took office 22 months ago and later extended that to senior political appointees throughout the government and canceled their bonuses.
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The critics are the expected -- mainly progressive economists and union officials. And in addition to condemning the president's position on both policy and morality grounds, the question they're asking in private is, what exactly did the White House get in return for the chip it gave away? (me: apparently not a damned thing)
"Today's announcement of a two-year pay freeze for federal workers is bad for the middle class, bad for the economy and bad for business," said AFL-CIO President Richard Trumka. "No one is served by our government participating in a 'race to the bottom' in wages. We need to invest in creating jobs, not undermining the ones we have. The president talked about the need for shared sacrifice, but there's nothing shared about Wall Street and CEOs making record profits and bonuses while working people bear the brunt. It is time to get our nation back on track, but we should not do so by placing an even greater burden on the middle class."
"This proposal to freeze federal pay is a superficial, panicked reaction to the deficit commission report," stated AFGE National President John Gage. "This pay freeze amounts to nothing more than political public relations. This is no time for scapegoating. The American people didn't vote to stick it to a VA nursing assistant making $28,000 a year or a border patrol agent earning $34,000 per year. (How can anyone in their right mind say these workers are o verpaid, at that rate??)
"President Obama asks federal workers to share the sacrifice, but it's unconscionable for him to attack the wages of federal working people while the millionaires and billionaires on Wall Street not only get their bailouts and astronomical bonuses; they also get their tax cuts," concluded Gage.
"It makes no sense to single them out for wage freezes at this time," said Tamara Draut, vice president of policy and programs at Demos.
Greg Anrig, vice president of programs at The Century Foundation said the move reinforced the concern that the focus of political debate in Washington is shifting from jobs to deficit reduction and fiscal austerity. "It's far to soon to be doing that," he said.
And yet, if the president needed some political breathing room, he was granted a bit from congressional leadership. While incoming Minority Whip Steny Hoyer (D-MD) didn't dismiss the idea outright (choosing instead to applaud the broader goal while asking for more time to review the specifics), incoming Majority Leader Eric Cantor (R-Va) took credit for the proposal. Demonizing federal employees and their pay rates has become a veritable GOP religion, and it would be far-fetched to see them giving Obama praise for their platform. (So they had Obama do their dirty work and took credit for it as well, giving him nothing. Why in God's name is Obama doing their dirty work for them???)
"I am encouraged by President Obama's proposal to freeze non-military federal pay for the next two years," said Cantor. "This past May, House Republicans -- prompted by YouCut voters -- offered the very same spending-cut proposal on the floor of the House. The YouCut proposal was one of many specific spending reductions offered by House Republicans over the past two years, and we are pleased that President Obama appears ready to join our efforts. As the recent election made clear, Americans are fed up with a government that spends too much, borrows too much and grows too much."
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Monday, November 29th 2010 at 6:11PM
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