WASHINGTON — President Barack Obama proposed freezing the pay of about 2 million federal civilian employees this fiscal year and next to help rein in the budget deficit.
The freeze would hit all civilian workers in the government, including those at the Department of Defense.Military personnel wouldn’t be affected. The move would save about $2 billion for the rest of fiscal 2011, which ends Sept. 30, and more than $60 billion over the next decade, according to the White House.
It would not affect defense contractors, postal workers or federal court judges and workers.
“Getting this deficit under control is going to require broad sacrifice,” Obama said Monday in Washington. “And that sacrifice must be shared by the employees of the federal government.”
The federal government is on track to rack up the third trillion-dollar-plus deficit in history. Yearly deficits have ballooned primarily as a result of falling tax revenue and rising recession-related costs.
Last year’s deficit totaled $1.3 trillion, second highest in history, down from the all time record of $1.4 trillion set in 2009.
The national debt stands at $13.8 trillion.
The chairmen of Obama’s commission on deficit reduction have proposed a three year freeze on federal salaries and a 10 percent cut in the government work force. The panel is scheduled to deliver its report Wednesday.
In Arkansas, the federal government employs more than 14,500 civilian workers, the majority of whom work for the Department of Defense or the Department of Veterans Affairs, according to the federal Office of Personnel Management’s Fed-Scope website.
About 1,300 workers were in line to earn $100,000 annually with 235 earning $180,000-plus (the highest pay category listed), according to the website’s most recent numbers for the state.
About 6,600 expected to earn less than $50,000 annually with fewer than 40 falling into the lowest income bracket (less than $20,000).
The website’s salary amounts are annual base pay amounts and don’t include overtime or benefits. The website also doesn’t include employment numbers for more than a dozen agencies, including the United States Postal Service, the judicial branch and the CIA.
The head of the government’s largest employee union, which represents 600,000 federal workers, denounced Obama’s proposal.
“A federal pay freeze saves peanuts at best,” John Gage, president of the American Federation of Government Employees, said in a statement. “The American people didn’t vote to stick it to a Veterans Administration nursing assistant making $28,000 a year or a Border Patrol agent earning $34,000 per year.”
Jeffrey Zients, deputy director of the Office of Management and Budget, said asking the federal work force to forgo pay raises was “a difficult decision”
“It’s the first of many difficult steps” to be taken by the administration “to cut costs and do more with less,” he said on a conference call.
The pay freeze proposal would require congressional approval. House Republican leader John Boehner of Ohio, who is set to become speaker in January when Republicans take control of the chamber, has said he supports freezing federal hiring and government workers’ pay.
“Without a hiring freeze, a pay freeze won’t do much to rein in a federal bureaucracy that added hundreds of thousands of employees to its payroll over the last two years while the private sector shed millions of jobs,” Boehner said.
Rep. Darrell Issa, a California Republican, called the proposed two-year freeze in civilian pay “long overdue” even though the $2 billion in savings for this year is a minuscule amount in a $3.8 trillion budget.
Rep. Steny Hoyer of Maryland, the No. 2 Democrat in the House, said Americans are tightening their belt and “federal employees must not be different.” He said the pay freeze should apply to military personnel, except for soldiers “risking their lives” in Iraq, Afghanistan or elsewhere.
“It would have also added an element of fairness: There has been parity between civilian and military pay raises for 22 of the past 28 years in which raises were authorized,” said Hoyer, whose district includes military installations and federal civilian employees in suburban Washington.
Obama previously proposed postponing raises for senior government officials in his budget for fiscal year 2011, which began Oct. 1. He’s also suspended bonuses, cash awards and other discretionary compensation for political appointees through the end of this fiscal year.
The administration already has ordered a three year freeze in non-defense and national security programs in Obama’s budget released Feb. 1, and ordered some agencies to reduce their 2012 budget requests by 5 percent.
The government is projected to spend $457 billion on personnel costs in fiscal 2011, according to the Congressional Research Service. That’s up from $447 billion spent in 2010.
Without congressional action, federal employees would automatically get a 0.9 percent increase under the formula set by a 1990 law.They received a 1.9 percent pay increase this year.
“A federal pay freeze was inevitable given the politics of the deficit and the limited pay increases that private sector workers are receiving,” said Stan Collender, a former congressional budget aide who’s now managing director of Qorvis Communications in Washington.
“Anyone who thinks federal workers will be the only ones to feel the impact of deficit reductions is seriously misreading the budget tea leaves.”
The federal government is the nation’s largest employer, with about 2 million workers. About 85 percent of them work outside of the Washington, D.C., area.
Congress, not covered by Obama’s new freeze plans as a separate branch of government, froze its pay last April, with House and Senate votes to forgo an automatic $1,600 annual cost of living increase.
House members and senators are paid $174,000 a year. Their last pay increase was $4,700 a year at the beginning of 2009.
The president’s pay of $400,000 a year was fixed by Congress in January 2001 and has not changed since then.
Information for this article was contributed by Roger Runningen, Julianna Goldman, Brian Faler, Holly Rosenkrantz and Heidi Przybyla of Bloomberg News; by Chad Day of the Arkansas Democrat-Gazette; by Tom Raum, Julie Pace, Andrew Taylor, Sam Hananel and Jim Kuhnhenn of The Associated Press.
Front Section, Pages 1 on 11/30/2010