Monday, February 8, 2016

Deciding how much elected officials should get paid

This morning we tossed out the question, what's the best way to determine the salaries of elected officials?

Deciding how much elected officials should get paid


This morning we tossed out the question, what's the best way to determine the salaries of elected officials?

We asked because Pennsylvania elected officials are due to get an automatic pay raise this week. That sounds offensive, of course, given PA's economic situation, but there is a rationale for making officials' salary adjustments automatic, rather than leaving it in their hands: It reduces the risk that they'll overpay themselves (the likely outcome in Pennsylvania), or that they'll duck a risky political issue and underpay themselves, which would make it harder for folks from all walks of life to run for office.

(Important side note: It's true that many officials will be donating these raises to charity, but as Eric Epstein observes here, the raises will still count toward their pensions. He also offers this helpful reminder: "The raises are on top of defined benefit pension plans, free parking, generous health benefits, per diems, perks and PSAs.")

We spoke to Muhlenberg College Professor Christopher Borick, who says that, given the risks of legislators setting their own pay, automatic adjustments make sense. The problem is that in Pennsylvania, they're tied to the Consumer Price Index, which measures the buying power of a dollar. But if the buying power of the dollar changes while most citizens make the same amount (or less) money, legislators end up getting raises disproportionately bigger than the rest of us -- which is exactly what's happening now. A better approach, Borick says, would be to tie the raises to some labor market indicators. For more ideas on how to make this work, check out tomorrow's editorial in the Daily News.

Another option is a "compensation commission." Nineteen states use some form of this. These commissions either decide officials' salaries or make recommendations about them. But one way or another, they allow public deliberation over how much officials should get paid that takes into account factors like the labor market and the demands of the job. And it allows for that deliberation to be done by someone other than the officials themselves.

Of course, the members of these commissions tend to be appointed by ... elected officials. So there's no perfect system. We can add checks to the process, but at the end of the day, the best way to make sure officials' pay is appropriate is for voters to pay attention.

Meanwhile, for a fun time, check out this chart of legislator compensation from the National Conference of State Legislatures.

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Every year, city government spends slightly more than $4 billion. Where does all that money come from? More importantly, where does it go? Are we getting the most bang for our tax buck? “It's Our Money” is a joint project between Philadelphia Daily News and WHYY, funded by the William Penn Foundation, designed to answer these questions.

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