MR. GREGORY: Well, but again, if you’re talking about austerity, and you want to deal with this budget deficit, doesn’t there have to be a sense of shared sacrifice, that everybody gets hurt?
GOV. WALKER: Well, there is.
— Transcript of Meet the Press, February 27, 2011
Erin Parker wasn’t trying to become famous. Erin is a 30-year-old second-year science teacher at East High. During a protest at the Capitol, a teaching colleague of hers struck up a conversation with a colleague of New York Times reporter Trip Gabriel. Gabriel was working on a story about the national backlash against teachers, and ended up having a long conversation with Erin about her thoughts on her profession.
Gabriel’s article was published in the Times on March 3, and – lo and behold –it featured the situation of Erin Parker. According to the article:
Ms. Parker, a second-year teacher making $36,000, fears that under the proposed legislation class sizes would rise and higher contributions to her benefits would knock her out of the middle class.
“I love teaching, but I have $26,000 of student debt,” she said. “I’m 30 years old, and I can’t save up enough for a down payment” for a house. Nor does she own a car. She is making plans to move to Colorado, where she could afford to keep teaching by living with her parents.
After the article appeared, I heard from parents of some of Erin’s current students at East about how hard she is working and what a great job she is doing, a view enthusiastically seconded by East principal Mary Kelley.
I recently had a chance to talk to Erin. She wanted it known that she is not interested in being the face of Wisconsin teachers, she is not complaining about her $36,000 salary, and, best news of all, she thinks she’ll probably be able to stay at East.
I recently wrote that because of some fortuitous circumstances, the Governor’s proposed budget probably will not have a calamitous effect on the Madison school district. I based this opinion in part on my expectation that the legislation ultimately passed will require contributions from all the state’s public employees toward their retirement accounts, a change that should save our district about $11 million a year
Good for the district, not so good for our teachers. Erin Parker’s financial situation, which she graciously shared with me, puts these figures in a real-life context.
As the Times article mentions, Erin’s annual salary as a second year teacher is about $36,000. Her take-home pay last month was $2,264. (Like many teachers, she has chosen to be paid on a 12-month schedule.)
There is much talk in some circles about our teachers’ health insurance. Madison teachers have two options for health care: the “gold-plated” WPS policy or the less-expensive Group Health HMO option. Those who choose WPS must pay part of the premium. Consequently, most new teachers choose Group Health. Erin has a Group Health policy. Her paystub reflects that the District pays $437 per month for her health insurance, plus $27 per month for dental insurance. She has a $3 a month payment for her portion of the dental insurance premium. So, Erin’s health and dental insurance costs the school district about $5500 per year.
Erin also has about $26,000 in Stafford loans incurred to pay for her college education, plus $10,000 in additional college loans. She has to pay about $300 per month on her student loans.
The budget repair bill calls for all public employees to pay the employee portion of the state’s contributions to their retirement plans. This works out to 5.8% of each public employee’s pay.
The budget repair bill also calls for public employees to contribute more to the cost of their health insurance. This provision does not specifically apply to our teachers because their insurance is not provided through the Public Employers Group Health Insurance plan. Nevertheless, the Governor’s budget documents assume that school districts as well as all public employers will require this additional employee contribution as well. The governor’s office estimates that this change will further reduce state employees’ salaries by about 4.2%.
So, the Governor wants to slice 10% out of teachers’ salaries. For Erin, 10% of $36,000 is $3,600, or $300 per month. If you assume that her take home pay, after student loan payments, is about $1950 per month, that works out to about a 15% cut in her spendable income.
Here are a couple of points that are kind of obvious but don’t seem to be mentioned much.
First, employee benefits are components of overall compensation. It is the level of overall compensation that is of importance to employers and other decision-makers. Teacher unions, like Madison’s MTI, have generally followed a bargaining strategy of maintaining benefit levels at the expense of higher wages.
It is almost meaningless to criticize the level of employees’ benefits while ignoring their overall level of compensation. I am a partner in a law firm and so I pay the entire cost of my health insurance and retirement plan. Erin Parker has much better benefits than me. I’m not much interested in swapping paychecks with her, though.
Second, the proposed changes to public employees’ benefits do not change those benefits but increase employee contributions. This translates into a reduction in compensation. In other words, the Governor’s proposals are designed to slash public employees’ take-home pay.
Third, the state budget deficit is in no way attributable to greed-monkey K-12 teachers. Teachers are employed by local school districts, not the state. Each local school district’s budget is balanced each year, regardless of the amount of state aid the school district receives.
Fourth, the Governor estimates the state’s budget deficit over the upcoming two-year biennium at about $3.6 billion. (Others, including State Representative Mark Pocan, maintain that this figure is inflated). While they are not state employees, teachers are targeted big-time to help the state balance its books. According to the Department of Administration’s Budget in Brief, the proposed “increase in school district employee contributions toward their pension and health insurance benefits [are] estimated to save nearly $1 billion over the biennium.”
So, let’s recap how Governor Walker’s “shared sacrifice” is supposed to work by looking at its impact on two typical Wisconsinites, Erin Parker and, oh, let’s say me.
As a lawyer in private practice, I make pretty good money. I could easily pay an extra $300 per month in taxes to the state to help deal with the current budget crisis. How much more does the Governor want from me? As far as I can tell: zero, zilch, nada.
Instead, every month he wants to pluck that $300 out of the purse of 30-year-old Erin Parker, by all accounts a wonderful new teacher, and thereby threaten her ability to support herself if she continues in the job she loves.
Nearly thirty percent of the state’s budget deficit is to be made up by slashing the take-home pay of Erin Parker and her teaching colleagues around the state. Zero percent of the deficit is to be made up by asking a little more from attorneys in private practice like me.
Most folks in this state have an inherent sense of fundamental fairness. That’s why Governor Walker has to pay lip service to the concept of “shared sacrifice.” But for the Governor, sharing the sacrifice really means that the politically-disfavored get hammered while the privileged remain untouched.
This is not fair, and we know it with our hearts as well as our heads. And so people take to the streets, write letters, work on recalls, do whatever they can to express in whatever ways they can that this is not our Wisconsin.