The state of California continues to make headlines as one of the worst economic basket cases in the country. Despite crushing workers and businesses with a torrential onslaught of new taxes, California continues to go broke by increasing spending at a frenetic pace.
California is going broke. Again. The state controller has estimated that the state will run out of money sometime this month. California will need to find $3 billion in cuts or revenues to keep the state in the black through the rest of this fiscal year.
And next year looks even worse. California’s Legislative Analyst Office projects that, even with billions in one-time revenues from Facebook’s impending IPO, Gov. Jerry Brown’s budget will run a $6.5 billion deficit.
While most of California’s residents are struggling to survive as incomes decline and living costs go up, the elite class of California state employees are getting rich. This privileged class of employees has managed to coerce politicians into providing lavishly extravagant compensation packages that will eventually bankrupt California. For those who think this cannot happen, consider the bankruptcies of Stockton and San Bernardino.
Bloomberg recently published a detailed look at how the privileged class of public employees are egregiously enriching themselves at the expense of California taxpayers.
Nine years ago, California Democrat Gray Davis became the first U.S. governor in 82 years to be recalled by voters. The state’s 20 million taxpayers still bear the cost of his four years and 10 months on the job.
Davis escalated salaries and benefits for 164,000 state workers, including a 34 percent raise for prison guards, the first of a series of steps in which he and successors saddled California with a legacy of dysfunction. Today, the state’s highest-paid employees make far more than comparable workers elsewhere in almost all job and wage categories, from public safety to health care, base pay to overtime.
Payroll data compiled by Bloomberg on 1.4 million public employees in the 12 most populous states show that California has set a pattern of lax management, inefficient operations and out-of-control costs. From coast to coast, states are cutting funding for schools, public safety and the poor as they struggle with fallout left by politicians who made pay-and-pension promises that taxpayers couldn’t afford.
“It’s outrageous what public employees in California receive in compensation and benefits,” said Lanny Ebenstein, who heads the California Center for Public Policy, a Santa Barbara-based research institution critical of public payrolls.
“Until public employee compensation and benefits are brought in line, there will be no answer to the fiscal shortfalls that California governments at every level face,” he said.
Among the largest states, almost every category of worker has participated in the pay bonanza. Britt Harris, chief investment officer at the Teacher Retirement System of Texas, last year collected $1 million — including his $480,000 salary and two years of bonuses.
The numbers are even larger in California, where a state psychiatrist was paid $822,000, a highway patrol officer collected $484,000 in pay and pension benefits and 17 employees got checks of more than $200,000 for unused vacation and leave.
The result isn’t only a heavier burden on California taxpayers. As higher expenses competed for fewer dollars, per- pupil funding of the state’s public schools dropped to 35th nationally in 2009-2010 from 22nd in 2001-2002. Californians have endured recurring budget deficits throughout the past decade and now face the country’s highest debt and Standard & Poor’s lowest credit rating for a U.S. state.
The story of one prison psychiatrist shows how pay largesse has spread.
Mohammad Safi, graduate of a medical school in Afghanistan, collected $822,302 last year, up from $90,682 when he started in 2006, the data show. Safi was placed on administrative leave in July and is under investigation by the Department of State Hospitals, formerly the Department of Mental Health.
Former division chief Jeff Talbott retired last year from the California Highway Patrol as the best-paid trooper in the 12 largest U.S. states, with $483,581 in salary, pension and other compensation. Talbott declined a request to be interviewed.
California had almost 11,000 workers in the Department of Corrections and Rehabilitation who made $100,000 or more in 2011, and about 900 prison employees earning more than $200,000 a year, data compiled by Bloomberg show. New York had none. Its top-paid officer is a sergeant at Sing Sing Correctional Facility who made $170,000 last year.
Forty-two nurses in California’s prisons and mental hospitals have reaped especially rich overtime payouts. They made an average of $1.3 million each during the seven years, including $674,000 in overtime.
The highest-paid nurse in the seven years was Lina Manglicmot, who worked at a state prison in Soledad, about 130 miles (209 kilometers) south of San Francisco. She collected $1.7 million from 2005 through 2011, including $1 million in overtime, the data show. Manglicmot declined to comment.
With these kinds of abuses going on, it’s not a question of if – it’s a question of when California is forced to go to court to obtain relief from ridiculously lavish compensation packages that are endangering the solvency of its residents.
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