‘The money we have is finite’

It's become a familiar dialogue with state (and other government) employees.

The newspaper editorializes that state workers continue to get raises each year, even during hard times when the private-sector taxpayers who fund those salaries may get no raises, at all.

Reliably, the phones begin to ring -- government employees protesting the proffered figures about their raises and rates of compensation are "all wrong." Many actually go so far as to assert they've received "no raises for six years" (or whatever.)

Really? Would you be willing to bring in your latest paycheck stub, along with a few sample stubs from two, four and six years ago, to demonstrate that your take-home pay has remained the same over all those years?

"Well, obviously, the checks get bigger," the callers stammer. "But that's just because of the 'step' raises. Those don't count. After all, you people in the private sector get your automatic 'step' raises every year, don't you?"

Um ... no.

Apparently, they're not pretending. Rather, the blind spot seems to be on the order of a permanent disability. For instance, when Nevada Gov. Jim Gibbons called the Legislature into a special session last week to put together a quick patch to balance a state budget that faces dwindling tax revenues, Dennis Mallory, executive director of the American Federation of State, County and Municipal Workers Local 4041, at first endorsed the governor's plan to withhold annual raises from state employees during the next legislative session.

Then, a day later, what do you suppose Mr. Mallory said?

Why, he hadn't understood the governor meant to also withhold the employees' step raises!

Mr. Mallory said Wednesday the state has a "contractual agreement" with the workers to hand them the raises, and they'll sue if the "step" raises are withheld.

State teachers union president Lynn Warne promptly jumped on board, threatening to sue county school boards if teachers aren't given their automatic raises.

Actually, Mr. Mallory's organization does not have collective bargaining rights with the state. But he points to a 1990 court decision, in which the State of Nevada Employees Association won reinstatement of a 4 percent salary increase canceled by Gov. Bob Miller during an earlier economic downturn, as precedent.

Most state employees receive step raises of 4.5 percent per year in each of their first 10 years on the job. That means 57 percent of state employees get the raises, which -- thanks to the magic of compounding -- add up to more than a 55 percent pay hike over the decade, not counting "cost-of-living adjustments," and also not counting hikes in their base pay should they get promoted to more responsible positions or even just "advanced in grade."

State employees are receiving a 4 percent cost-of-living increase in the fiscal year that ends June 30, which means more than half of state workers are currently poised to get raises of 8.5 percent.

For teachers in Clark County, step increases range from 2 percent to 4 percent and remain in effect for about 14 years, according to the Clark County Education Association.

On average, that adds up to a 51 percent raise, not counting "cost-of-living" adjustments (which never seem to adjust "down," even when the price of gasoline falls in half.)

Assembly Speaker Barbara Buckley, who will have to balance the state's 2009-2010 budget, has been mum on the threatened lawsuits. Daniel Burns, Gov. Jim Gibbons' communications director, reiterated, "The money we have is finite."

Mr. Mallory doesn't see a recession-driven decline in tax revenues as a problem. Legislators merely "need to increase revenue" via tax increases, he explains.

Ah: Tax hikes during a recession, driving more small businesses into failure so the still-growing cadre of state bureaucrats can be paid more to "service" a shrinking population. Does that make sense?

Or would it make more sense to tell Mr. Mallory and Ms. Warne what Mayor Oscar Goodman has told Las Vegas city employees: You can sit down at the table to discuss compensation for all the workers you represent, or we can start planning the layoffs now?