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Posts published in “Connecticut Newspapers”

CT State Employees 5th Highest Paid in U.S. – Raises and Bonuses on Top of That?

Connecticut Governor Lamont has proposed to award state employees significant wage increases and bonuses over three years. But before moving ahead, policymakers should consider whether public employee pay increases are warranted.

A recent study authored by one of us finds that the average Connecticut state employee already receives total pay and benefits roughly one-third higher than is received by comparable private sector workers in Connecticut. This 33% premium is the fifth highest compensation premium out of the 50 U.S. states. Lamont’s proposal would likely widen that gap.

According to state employee union documents, Lamont is proposing to award all unionized state employees three annual base salary increases of 2.5% and, for about two-thirds of employees, annual “step increases” of 2.0%. The wage and step increases are retroactive to July 1, 2021. On top of these increases, every employee will receive bonuses of $2,500 this coming May and $1,000 in July. The bonuses are pensionable.

The new study of compensation for state government employees, authored by Andrew Biggs, examines wages and benefits of state government employees in the 50 states, in each state comparing their compensation to that of private sector workers with similar levels of education, experience and other characteristics.

The use of the same methodology in all 50 states establishes a level playing field and produces genuine comparative results among the states. Moreover, comparing state and private workers in the same state eliminates the need for any cost-of-living adjustments.

State employees may not seem overpaid. But salaries are only part of the story.

The study also finds that fringe benefits are dramatically higher in state government than in the private sector. State employees in Connecticut accrue pension benefits that are roughly six times more generous than the employer contribution to 401(k) plans which predominate in the private sector.

Connecticut’s retiree health program for state employees is by far the most generous in the country. According to state accounting disclosures, the future benefits accruing to current Connecticut state employees are worth an extra $16,000 for each year of work. Retiree health coverage is nearly extinct for private sector workers.

Overall, total fringe benefits for Connecticut state government employees are over three times higher than for similar private sector workers, which more than makes up for slightly lower salaries in state government.

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CT Gov. Lamont Violates Federal Law With Pension Bailout; Then, Offers Sweetheart Deal To State Unions

States have done many things with the federal aid that state governments received under last year’s $1.9 trillion American Rescue Plan (ARP). One thing they are expressly prohibited from doing is pouring that money into pensions for well-paid public employees. Connecticut is doing it anyway.

In February, Gov. Ned Lamont’s released his $48 billion two-year budget proposal. It funnels $2.9 billion in special deposits into the state employee and teacher pension funds. This is an amount equal to all the ARP aid the state received. These special deposits are over and above Connecticut’s regularly scheduled $7.2 billion in state contributions to the two retirement systems.

This month, Lamont has proposed to pay state workers a $3,500 bonus payment, or 4.5% of the average employee’s wage of $77,000. In addition, he intends to pay 2.5% annual wage increases over three years while also paying “step increases,” which average about 2% annually.

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Biden in Retreat

President Biden sounded full retreat in his State of the Union address last night.

March 2, 2022

On the domestic front, that was a welcome development, since it signified the complete defeat of the radical socialist wing of the Democrat party.

On the foreign policy front, it was a sad day for America, the Free World and freedom loving people around the globe. Under Biden, America has led from behind on Ukraine, with the result that democratic Ukraine is all alone in its valiant fight against unprovoked, unjustified Russian aggression launched by a totalitarian dictator.

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Things Happen

After three years in office, Governor Lamont’s profile has become clear. He does not make things happen; he just lets things happen.

He has a growing scandal in his administration. He has called it a new development. We just learned that he was alerted to the problem in 2020.

February 16, 2022

He let the situation fester until an FBI investigation became public and forced his hand.

Also in 2020, yet in very public fashion, Lamont commissioned Boston Consulting Group to conduct a study of state government staffing and to recommend how to deal with a long-expected retirement wave that is now upon us.

BCG submitted its very worrisome findings almost a year ago. Since then, there is no evidence that Lamont has done much to deal with what is now a crisis.

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Blue State Blues: Connecticut’s Jobs Problem

Connecticut is a blue state, with a serious case of the job market blues.

In December, the state added just 600 jobs, a sad number, and even sadder because the likely cause is abandonment. That is, workers are leaving the state.

The December number leaves state employment at about 1,625,000, still about 75,000, or 4.4%, below its pre-pandemic level of 1.7 million in February 2020, according to the Connecticut Department of Labor. National employment is only 1.8% below its February 2020 level.

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The Pandemic Is Over. Pivot to the Economy.

In the early days of COVID, the key objective was herd immunity. Today, we are there, or very nearly so. We should declare victory. It has been a costly victory. It may be a Pyrrhic victory, unless we pivot rapidly from COVID to the economy.

It is time to address the economic damage wrought by the wholesale shutdown of the economy in response to COVID. At the outset, many observers, including this writer, expressed grave reservations about the shutdown.

The national debt has increased $5.3 trillion, or more than 30%, during the pandemic.

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The Big Apple Exodus to Connecticut Never Happened and Here’s Why

The suburban myth of a mass exodus from a virus-plagued New York City to the supposedly safe environs of Connecticut died with the recent release of Census Bureau interstate migration data.

While New York State lost over 400,000 residents to other states from April 2020 to July 2021, Connecticut attracted a mere 226 net new residents from other states. Incoming New Yorkers passed fleeing Nutmeggers.

And that’s the good part. Connecticut’s labor force plummeted by 100,000, or more than 5%, from February 2020 through November 2021, according to the U.S. Bureau of Labor Statistics. Only two state workforces contracted more.

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Confused About COVID? Who Isn’t?

A month ago, the nation had reached an 80% one-shot COVID vaccination rate for those over age 18, with 96% of vaccines administered being the 95%-effective Pfizer and Moderna shots. Forty percent of the very-vulnerable elderly, who were 100% vaccinated but whose early vaccinations from last winter were weakening, had received boosters. Pfizer had announced its 89%-effective home-use COVID treatment pill.

The nation seemed poised to emerge from the pandemic and move forward. We seemed very well situated to avoid the enormous infection wave swamping Europe.

Then, Omicron.

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Alarmed by the COVID-19 Surge in Europe? Don’t Be.

Americans should be thankful, not fearful. The U.S. is unlikely to see the kind of COVID-19 surge now occurring in Europe or be as severely impacted by the Omicron variant.

The U.S. has high COVID-19 vaccination rates. Eighty-two percent of those 18 and older and 100% of the uniquely vulnerable population over age 65 have had at least one shot, according to the Centers for Disease Control. Of equal importance, over 96% of vaccine doses administered have been the strong 95%-effective Pfizer and Moderna shots.

The U.S. has been fast to deploy boosters, especially to those over 65, over 40% of whom have been boosted. The Pfizer and Moderna vaccines, while fast-acting, lose effectiveness over time. The elderly were vaccinated first, so they are most in need of boosters.

In Europe, vaccination rates are high, but many people have been vaccinated with less effective vaccines, primarily the AstraZeneca COVID-19 vaccine which is somewhere between 63% and 79% effective.

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Lunch Pail Issues for Voters to Consider

Connecticut Governor Ned Lamont went to Washington last week. He visited the White House, with whose occupant he shares much in common, especially on the “lunch pail” issues of gas prices and jobs.

Biden’s policies have already pushed gas prices to record seven-year highs. Lamont’s gas price hikes are only an ambition right now. The Connecticut General Assembly has not yet approved Lamont’s proposed new gas tax, aka the multi-state Transportation Climate Initiative (TCI) – emphasis on “yet.”

“Yet” is the point. Voters in next week’s local elections should keep in mind that General Assembly Democrats are watching. If local Democrats do well, Democrats in Hartford may gain the confidence to pass TCI.

For his part, Biden is taking rightful heat for high gas prices, since his anti-carbon policies are largely to blame. The day he took office, Biden cancelled the Keystone pipeline and froze oil and gas exploration leasing on federal lands.

Since July, oil has jumped from about $60 a barrel to about $85 and gas prices have skyrocketed. Is Biden concerned? Just the opposite. He has been worried that his multi-trillion dollar Build Back Better bill with its anti-carbon provisions may not come together before the Glasgow climate summit.

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