Via a political process we’ve agreed that it is reasonable for the president of the U.S. to earn $400,000 per year. Does it make sense to use tax dollars to support non-profit organizations whose employees pay themselves more than that?
This Wall Street Journal article by Senator Jim Demint says that Public Broadcasting Service and National Public Radio executives earned between $$370,000/year and $1.2 million per year. Regardless of whether or not the non-profit organizations could have found people to work for less money, there is a reasonable question of whether the government should forcibly collect tax dollars from folks earning the median $16/hour wage and feed those dollars to public broadcasting employees earning far more than President Obama.
Who voted for that?
The Coalition government in the UK is trying to float the idea that no civil servant should earn more than the Prime Minister. Unfortunately, many do. A lot of them work for local government councils, which are responding to central government cuts in funding by cutting frontline services. Few of them are cutting pay to senior execs of those councils. It seems to be a similar problem to the looting of the shareholders in public companies that you often highlight.
This seems to be conflating nonprofit work with government work, i.e. if one could be doing it, so could the other. In some cases, this is probably legitimate, such as funding disease research, which in this country, is indeed funded by a mixture of government and nonprofit sources.
In others, it is clearly not. I wouldn’t want a nonprofit in charge of my roads or the military, and I wouldn’t want the Senate appointing the conductor of the BSO.
How far into government checks does it go, though? Should the same condition be imposed on Lockheed Martin? That doesn’t seem correct, even though the major defense conglomerates are basically government agencies in all but name.
Maybe if more than 80% of any company’s revenue comes from the government, their executives should be subject to congressional whim in terms of pay and working conditions as well?
@Joshua: “Should the same condition be imposed on Lockheed Martin? ”
Lockheed Martin is owned by private individuals who own their stock. NPR is an endowed NGO funded by the government. I’m not a big fan of either organization, and would be perfectly happy if the government stopped or radically cut back funding both, but I’m a particular non-fan of NGO type organizations, who are apparently completely unaccountable. At least Lockheed is accountable to its customers and shareholders. NGO’s? They’re like zombies, funded by dead people and perverted good intentions.
I don’t think the POTUS salary is the right benchmark, except for mayors, governors and other top executives. In any case, it was only recently raised by Bill Clinton (but not applied until George W Bush, just as the Cabinet secretary pay raises Hillary Clinton voted for do not apply to her). Bill Clinton made $200K when he was president.
Cabinet ministers like Defense Secretary Gates make a little bit over $200K a year. In San Francisco where I live, there are 9,000 city employees who make over $100K and 105 make over $200K a year (source: http://www.sfgate.com/webdb/sfpay/index.shtml), i.e. are deemed to have a more challenging job than the guy who manages what is probably the richest and one of the biggest bureaucracies in the world.
The single highest earner is a nurse who made $350K, mostly through overtime (i.e. thanks to utter incompetence from his managers). Most of the police and fire dept heads make significant overtime pay, but conveniently enough are in the position of deciding themselves how much overtime is required.
There are jobs like surgeons working for US Army hospitals where you have to pay a competitive wage, but the federal pay scale is fairly inflexible. The biggest excesses seem to be in peripheral quasi-agencies, and in state and local governments.
Joshua: I don’t think the comparison to Lockheed-Martin makes sense. Lockheed-Martin is a for-profit company. In theory, their employees get whatever the shareholders think they should get (in practice, presumably the executives get whatever their golfing buddies on the board decide to ladle out to their friends). Lockheed-Martin bids competitively on projects and has to be the low bidder to win. NPR need not compete with any other vendor for whatever service it provides to the government.
If we decide that the function of public radio is to praise the government’s achievements and promote the idea that taxes are used for worthy purposes, why not make that explicit and put that out for competitive bidding? Then different contractors could compete to be the best and, if successful, could pay their employees whatever they wanted (but they wouldn’t be tax-exempt like NPR/PBS).
Joshua: I thought about your comment “I wouldn’t want a nonprofit in charge of my roads or the military” a little more and realized that the main reason we wouldn’t want non-profit orgs in change of this stuff is that we couldn’t afford it. Imagine if we paid road and military bureaucrats $1.2 million/year each rather than the $100-200k/year that they get now.
Funding for public broadcasting is convoluted, to say the least, as the articles in Wikipedia on NPR and the Corporation for Public Broadcasting show. Still the part of public broadcasting budgets that come from taxpayer funds appears to amount to 15%. Most of the money comes from donations and corporate sponsors (essentially advertising). As a former donor to public broadcasting stations, I know that fundraising efforts are aggressive, even by Harvard or MIT standards.
Shouldn’t the market dictate how much workers in public broadcasting are paid? The government pays part of the tab for higher education, yet many top university administrators, including several in the Boston area, are paid more than the President of the United States. Is it reasonable to cap their pay at an arbitrary level determined by national politics, rather than what other similar institutions are willing to pay? I think not.
Does it ever make sense to compare any ordinary citizen’s pay to that of a head of state?
I can imagine several reasons to curtail government funding of public broadcasting, but executive pay is not foremost among them. I agree with Senator DeMint’s main argument, which states “Liberal financiers are willing to write million-dollar checks to help these organizations. There’s no reason taxpayers need to subsidize them anymore.”
Philip: Thanks for the perspective and data. The difference between federal funding of research projects at universities and funding NPR is that the universities are funded to deliver a result, e.g., a physics experiment or a biomedical research study. I guess you could look at producing talk shows on a daily basis as a “result” and say that the tax dollars are funding this.
As a taxpayer, I don’t know why I’m funding NPR, though. They have at least as many commercials as a for-profit radio station and then the annoying pledge drives on top of those commercials. NPR managers seem to earn far more than the average taxpayer and even more than the average government worker. As a classical music nerd, I would selfishly be happy if other peoples’ tax dollars funded a commercial-free classical music station, but that doesn’t seem to be part of the NPR/CPB/PBS plan. During my lifetime, it seems as though the public broadcasting folks have sucked down roughly $400 million/year in 2011 dollars or nearly $20 billion total. Why this hasn’t been enough for them to deliver a commercial-free service comparable to the CBC Classical station I don’t know. Maybe because they pay employees $1.2 million/year.
But personally if I could have my share of the $20 billion back, I would take it and spend it on Rhapsody, Pandora, and other commercial-free sources of music.
[This is not to say that I don’t think that journalism is not useful. Local newspapers, for example, are one of the only protections that the public has against looting by politicians and public employees, e.g., http://topics.nytimes.com/topics/reference/timestopics/organizations/l/long_island_rail_road/index.html
and http://www.cambridgeday.com/2011/02/08/even-retired-city-manager-would-reap-extraordinary-rewards/ ; but journalists who are funded by the government are not very likely to be aggressive investigators of how taxpayer dollars are spent.]
Yes, but we’re only paying 15% of that $1.2MM so it’s a bargain. And it provide needed jobs for radio journalists who are unable to get TV gigs on Fox or ABC.
Speaking of donors, here is another reason taxpayers shouldn’t give NPR one more dime.
http://voices.washingtonpost.com/postpartisan/2011/03/npr_fundraisers_ignored_unmist.html
I am embarrassed that I donated money to these guys. Given the current mood in the House of Representatives, the end of federal funding is nigh.
If you are curious about how institutional fundraising operates, here is a video documentary of an NPR lunch meeting. I can only hope that the anti-semitic opinions expressed here are not typical of NPR/CPB executive views.
It seems to me that the NPR officials said what they thought the prospective donors wanted to hear. And then they went well beyond. Who knows what they actually think.
Philip: That was hysterical. Thanks! Ron Schiller just goes to show how far a tall “empty suit” guy can get in this world. I am going to be really happy on April 15th to think about how my tax dollars were paying this guy’s salary. I tried to find his salary by pulling the Form 990 for the NPR Foundation, where he is supposedly president. He isn’t shown on the 2009 Form 990, though (which does show that the NPR foundation’s top employee at the time earned $1.22M in 2009). Perhaps Schiller joined more recently.
I guess it could be considered offensive when he says that he and his NPR pals are way smarter than the average American and that’s why they are liberal because only stupid people would refuse to accept increased government spending as their personal savior. But on the other hand, the NPR staffers are making between 10X and 30X the average American wage, forcing taxpayers at all income levels to work a few extra hours per year to keep their own wages high, and enjoying lunches and dinners every day at fancy restaurants. So realistically I would have to agree that NPR employees are smarter than almost everyone else. And if I could get a pipeline of tax dollars to terminate in my office I would probably support a bigger government too!