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Bulls & Bears
On Saturday March 6, Brenda Buttner was joined by Gary B. Smith, Tobin Smith, Pat Dorsey, Eric Bolling and Mark Levine.
Government Jobs and Salaries Surge as Private Sector Struggles
Eric Bolling, Fox Business Network: It's costing $108,000 to create a federal job, and $69,000 in the private sector for the exact same, apples to apples, job if you include all benefits. Straight salary comparison shows federal workers make about $7,000 more on average. But it's the huge difference in benefits that's so shocking. The average federal worker gets about $40,000 worth of benefits a year, compared to $9,000 in the private sector. Since President Obama was elected, the economy has shed four million jobs. Every single sector of the jobs market has lost logs, except for federal jobs. That says it all.
Mark Levine, radio talk show host: It's perfectly common for the federal government to stimulate the job market during a recession. The New Deal was the ultimate example of that. These jobs come in the form of say, infrastructure projects, and then those contractors go out and buy goods for their family, etc. The economy was losing 700,000 jobs per month. This expansion of federal jobs helped stabilize the job market, and that can't be looked at as a bad thing.
Tobin Smith, NBT Media: The real issue here is that no private employer can hope to compete with the U.S. Government. The federal government, on average, compensates its workers with a total of $108,000 while a private company can only pay $69,000. There is literally no way a private company can compete with that because they actually have to worry about being profitable. It pushes out private sector jobs. As a result, our economy spirals downward.
Gary B. Smith, TheChartman.com: Government workers live in a different world from the rest of society. You know why? Unemployment in the federal sector is at 4 percent. In construction, it's 12 percent. Now, liberals claim government workers get paid more than their private-sector counterparts because they're doing more and have more complicated responsibilities. But I'll give you an example—a clergy working in the government makes about $70,000 while one in the private sector makes $39,000. And as far as I know, God is God. The Federal Reserve recently came out with a study showing that growth in government stunts general economic growth, and increases in government spending or taxes lead to persistent decreases in job growth. So this is not good news by any means.
Pat Dorsey, Morningstar.com: In this context, government workers have very generous benefits. We can argue they're much too generous because they're promises you can't take back when it comes to benefits. They get paid out over a long period of time. But to put this issue to scale, there are about three million federal jobs in the U.S. out of 130 million total jobs. Eighty-four percent of these federal workers are employed outside the D.C. area. So I'm not sure this is a big a deal as some people are making it to be.
New Report: Deficits Set to Explode Amid $1 Trillion Health Care Push
Tobin Smith: The Congressional Budget Office is constantly wrong in its reports on the budget. If they're saying the deficit is going to be $1.2 trillion in the red, it'll probably end up being more like $3 trillion. The problem is that the CBO makes these assumptions that the government is actually going to reform or cut back the various programs they recommend going after, such as Medicare. But these cuts or reforms, never, ever happen, so the actual deficit numbers end up being much worse.
Mark Levine: We can afford this because it's going to save money in the long-term. The health care bill is not a budget buster; it's a budget jet booster. The CBO says health care reform will save $1 trillion. As the government saves money, consumers will save money, and this will ultimately be good stuff for our economy's bottom line and the federal budget.
Pat Dorsey: We can't afford not to do health care reform. Unfortunately what's being proposed isn't really health care reform. It's health care coverage expansion. These are two very different things. Health care reform means blowing up the fee for service system and paying for results, not procedures. But this would entail a radical reworking of the entire system, and that's unfortunately not on the table.
Eric Bolling: The health care reform proposals will drive the free enterprise of health insurance out the window. You want to effectively nationalize health care, so what's next? If uninsured people get to go into a public option, they get to pay less for coverage. Pretty soon, people that have private insurance are going to want to pay less money too. They'll opt into the public option, and before we know it, private health insurance will cease to exist.
Gary B. Smith: Public health insurance is not cheaper than private insurance. It appears to be cheaper because the government is able to hide a lot of the operating costs. They don't have to do marketing, they can share buildings, they don't have to worry about cost controls on administrative procedures, etc. If you like Medicare, you can claim we have this great system, but many of the large government programs like Social Security, Medicaid or Medicare are basically bankrupt. These price controls will have to explode at some point. And the cost of these reforms will rise drastically after the 10-year horizon for costs they're currently using.
Fire Government Workers Not Paying Their Taxes?
Gary B. Smith: We've found over 600 staffers on Capitol Hill owe about $8 million in unpaid taxes. If you're a part of making the laws of the land, you should live by the laws of the land. If you work for the IRS and don't pay your taxes, you get fired! The same rule should apply to everyone on Capitol Hill—from the congressional members to their staffers. That's the bottom line.
Mark Levine: If these staffers are doing this intentionally, these fire them, absolutely. But if forget or fail to declare a tip I may have received or some small interest payment, should I be fired? No. But if it's an egregious action, get rid of them.
Tobin Smith: Charlie Rangel appears to be our leader in all of this. If you do anything worse than Charlie Rangel, then you should get fired. I'll leave it at that.