Published February 21, 2013
The next time a politician or bureaucrat talks about their sacrifices as so-called “public servants,” grab your wallet and run in the opposite direction. In fact, the degree to which working in the public sector has become simply a means to make money is out of control. For all the hypocritical hooey from self-righteous politicians about out-of-control salaries and bonuses in the private sector, the ability to monetize public sector experience makes private sector paychecks seem like chicken feed.
Let’s start at the top, with the president. Just this last holiday weekend, his family split up for two separate vacations in two separate locations, costing taxpayers hundreds of thousands more as a result. And this isn’t the first time. That kind of luxury makes his demands for self-sacrifice in these hard times ring hollow. And while he claims that he wouldn’t mind paying more in taxes, that’s because he’s made millions off his public sector exposure and is going to make many millions more after he retires in his mid 50s. It should also be noted that his federal tax rate is so low (hovering at around 20%) largely because of his “donations,” much of which come from the proceeds of a couple of vanity books that he and his wife “wrote” with ghost writers.
Then there is the man who the president has tapped to be our next Treasury Secretary…another long-struggling “public servant,” Jacob (Jack) Lew. Mr. Lew started out long ago as an aide to the late, legendary House Speaker Tip O’Neill. In 2001, Mr. Lew took a break from the rigors of public sector life to become head of operations at New York University. While jobs in education often require sacrifice, Mr. Lew’s sacrifice entailed pulling down a salary that topped out at over $900,000 a year, more than what the University’s president was making. In addition, the New York Post just revealed that he got a $1.4 million loan from the University, the details about which (like whether it was ever paid off or forgiven) Mr. Lew claims he can’t remember.
After his sacrificial stint in the world of higher education, Mr. Lew became one of those evil bankers the president talks about. In 2006 he joined Citigroup, as their COO for something called the Alternative Investment Unit. This was one of those banking units that were at the heart of our financial meltdown. Among other things it oversaw “structured investment vehicles” that hid a lot of those lousy mortgages that helped cripple our economy. The unit reported $358 million in losses while Mr. Lew was there. But he still collected about a million bucks when he left Citi to join the Obama administration in 2009. And, yes, a lot of that was in the form of bonus compensation, against which the president was railing at the time.
But let us not forget Republicans. Former Senator Kay Bailey Hutchison is now making a bundle as a member of Bank of America’s Global Advisory Council. She’s also pulling down very nice fees on speaking tours, sometimes pairing up with another Republican, former New York Mayor Rudy Giuliani. And speaking of speaking, those two selfless souls Alan Simpson and Erskine Bowles also find time between reports about how to save America to make a little spare change on the speaking circuit. How much spare change? Well back in November it was about $40,000 a pop, but that number is said to have escalated in accordance with their notoriety.
Now, please don’t get me wrong. I have absolutely nothing against getting paid the largest sum of money one can possibly get for any activity that doesn’t involve human suffering (though one might argue about suffering through a Simpson-Bowles lecture). But it annoys the hell out of me when I hear people buying into this nonsense about the “sacrifice of public servants” without a hint of irony. Jack Lew, President Obama, and my dear friends Simpson/Bowles aren’t suffering. They may be working hard, but they’re not suffering. They’re flying first class, eating very well and getting a lot of face time for spouting off on whatever they feel like spouting off about. Basically, they’re like me.
But I’m making less and paying a much higher tax rate than the President. And no, I don’t have a problem with that. I do have a problem with the president and others suggesting that because they’re in the public sector, they’re sacrificing more than me. And if they truly consider themselves “public servants,” than Lord knows what they’re going to be serving up next.