Who would take Governor’s deal?

Why are state employees the Governor’s target? Revenues are up, and the Governor is happily giving away millions to companies that don’t pay income tax. Why should state workers take a $1,000 pay cut?

Mike Owen
Mike Owen

There’s a little gamesmanship about public-worker benefits this week that is avoiding a critical question: How will the state compensate workers for giving up negotiated health benefits?

Governor Branstad on Monday repeated his plans to push for a 20 percent premium contribution by state employees in the next contract, putting out a pledge to pay that amount himself right now. For the Governor it’s $224 per month.

IPP’s Andrew Cannon has done a good job of exposing the fact that public worker health benefits in Iowa, while more generous than those offered in the private sector, don’t make up for lower pay in comparable positions or positions requiring comparable qualifications/education. On balance, there is a penalty for working in the public sector.

Governor Branstad doesn’t talk about the wages/salary side. He is ignoring the fact that, unlike his pay and that of state legislators, state employees’ benefits in place are a result of bargaining — a point acknowledged far too little, but thankfully was cited this week by the Muscatine Journal’s Steve Jameson. State employees agreed on the pay levels they receive in the context of other benefitsthey al so receive.

Oddly, when the Governor says state workers should pay $1,000 toward their health insurance, he is peddling it all as savings to the state. Actually, we should expect salaries to go up to compensate for lost benefits.

Also, why are state employees the Governor’s target? Revenues are up, and the Governor is happily giving away millions to companies that don’t pay income tax, and leaving corporate tax loopholes open as well. So explain again, please: Why should state workers take a $1,000 pay cut?

Who would take that deal?

By Mike Owen, Assistant Director

Author: iowapolicypoints

The Iowa Policy Project is a nonprofit, nonpartisan organization that provides research and analysis to engage Iowans in state policy decisions. We focus on tax and busget issues, the Iowa economy, and energy and environmental policy. By providing a foundation of fact-based, objective research and engaging the public in an informed discussion of policy alternatives, IPP advances effective, accountable and fair government.

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