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Obama proposes federal pay freeze to help get deficit 'under control'

President Obama says the proposed federal pay freeze would save the federal government $2 billion in fiscal year 2011. The federal deficit is expected to be about $1.3 trillion.

By Staff Writer / November 29, 2010

President Obama leaves the lectern following remarks about a proposed federal worker pay freeze in Washington Monday.

Jason Reed/Reuters

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Washington

In a gesture of concern over the nation's massive budget deficit, President Obama proposed Monday a pay freeze for civilian federal workers over the next two years.

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The move, which requires congressional action to implement, would save the federal government $2 billion for the remainder of fiscal year 2011, which began Oct. 1, $5 billion over two years, and $28 billion in cumulative savings over the next five years, according to the White House. The federal deficit for FY 2011 alone is expected to approach $1.3 trillion.

In midday White House remarks, Mr. Obama couched the plan in the context of the nation’s larger fiscal challenges.

"The hard truth is that getting this deficit under control is going to require some broad sacrifice, and that sacrifice must be shared by the employees of the federal government,” Obama said. “After all, small businesses and families are tightening their belts. The government should too."

Civilian federal pay has become a political football in recent weeks. Democrats wanted to vote in a 1.4 percent pay increase for the 2.1 million-strong federal work force during the lame duck session of Congress. But the Republicans, who take control of the House in January, have other ideas.

Rep. Jason Chaffetz (R) of Utah, who will chair the committee that oversees federal pay, has said he wants a pay freeze and would prefer a 10 percent pay cut. A recent study by USA Today found that the number of federal workers who make more than $150,000 a year has risen 10-fold in the last five years and doubled since Mr. Obama took office in early 2009.

White House officials maintain that the proposed pay freeze is not related to the recent coverage of well-paid federal workers, nor is it connected to any expected recommendations by the president’s bipartisan deficit commission due out on Wednesday. Defenders of the federal work force argue that federal employees make less than private-sector workers with similar education and experience.

In his remarks, Obama acknowledged concerns that freezing pay could hurt the government’s ability to attract top talent.

"In these challenging times we want the best and brightest to join and make a difference," the president said. "But these are also times where all of us are called on to make some sacrifices. And I'm asking civil servants to do what they've always done: play their part."

Obama also touted past measures aimed at reining in spending, including: the freezing of salaries for senior White House officials; disposal of excess federal real estate; setting a goal of reducing improper federal payments by $50 billion by the end of 2012.

Republicans applauded Obama’s federal pay freeze proposal, but suggested it was just a start.

"At a time when our nation's seniors have been denied a cost-of-living-increase and private sector hiring is stagnant, it is both necessary and, quite frankly, long overdue to institute a pay freeze for the federal work force,” said Rep. Darrell Issa (R) of California, incoming chair of the House Committee on Oversight and Government Reform, in a statement. “As Republicans outlined in our Pledge to America there are a number of actions the president and Congress should immediately act on to demonstrate a real commitment to reigning in the excessive growth and spending of the federal government.”

Congressman Issa cites a report issued last week by the Office of Management and Budget that puts the amount of improper federal payments for FY 2010 at $125 billion, $15 billion over last year. Issa has proposed an aggressive schedule of hearings in the next Congress aimed at rooting out waste, fraud, and abuse.

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