Rumors on Steroids

The White House pay freeze, the possible congressional pay freeze and the national funk over economic conditions have revved up the federal rumor mill big time.

Folks who cover the federal beat are getting lots of traffic from worried workers and retirees. Many are wondering if the bell will also toll for them.

While most feds are probably taking things in stride, concentrating on their jobs, families, mortgage or vacation plans, some aren’t: many of them are either scared (about something that might happen) or furious about something that hasn’t even been proposed.

The President’s budget won’t go to Congress for another month. Maybe two. This is standard-operating-procedure for a new administration. So nobody knows (or at least nobody I know knows) what kind of pay raise the president will recommend. Or not? For background on that, click here.


Here’s what some people are telling us:

  • “It’s time for another rumor putdown. The latest: Obama’s budget is going to propose a Fed pay freeze until 2010, 2015,…” Larry at the IRS
  • “Most people have very short memories. What was I going to write?

    “Anyway, life is a rollercoaster ride of ups and downs. It is no deep dark secret that our economy goes through a cycle of bear and bull markets. So why do so many people act like grasshoppers instead of ants?

    “Like the fable is told, the grasshoppers (most people in America) laugh at the slow methodical (government employee) ants who drive less than new cars, don’t spend to the max, and keep putting money away for a rainy day. Well, its raining today! More like ice and snow coming down sideways in the economy right now and people (grasshoppers) are looking at the cozy warm ants (G man and women) and saying, “Hey, why do they have it so good? They don’t deserve to have it any better than I have it right now!” So the ants will open their door and share what little they have with their grasshopper cousins.” Denver Doug

  • “Mike, Can the Federal Government freeze the yearly cola for retirees?” Larry Hovermale

    Short answer: Yes BUT! The government (that is Congress) can do just about anything it wants. There has only been one freeze since federal-military retirees started getting cost of living adjustments. Because Social Security recipients get the same adjustments it is unlikely Congress would touch the issue. MC

  • “Any chance Congress will cut federal retirement benefits if living costs continue to drop?” Al Whitney

    Again, Congress can do anything, but probably won’t. If there is no inflation, retirees would not get a raise in 2010. But if there is deflation, annuities are not reduced. They would remain at current year levels. Click here for an explanation.

  • “We keep hearing that the U.S. Postal Service is planning to offer buyouts and to give selected workers an extra 5 years of age and service time to boost their retirement benefits. Any truth to this? With 5 years and 1 month to go I’m interested.” Rich in Portland

    The U.S. Postal Service is trying to downsize by offering workers the chance to take early retirement. And it is talking about going to a 5-day delivery week. But the odds of getting a buyout are slim-to-none. The rumor about getting an extra 5 years age/service credit has been around for nearly 40 years. It may be time to retire that puppy! MC

  • ” What form of logic would our congressmen use to justify freezing federal pay after passing a nearly $1 trillion stimulus package? Would that mean Congress believes they need to determine what special interest group deserves a check to spend on a new car, or a $15,000 tax break to buy a new home vs. paying those who are doing the government’s work a fair wage so they can spend their own money on the same things? In other words, our Congress would rather give money away instead of paying a fair wage to workers?” Gary in Omaha
  • “If things don’t improve markedly by year’s end, there should be no raise in federal pay. Remember federal workers get yearly pay raises from an entity that produces no product and makes no profit. Government can only take money from others. Time to suck it up until things gets better.” Mike H., IRS
  • “As to your column… I made my sacrifices in the ’80s when I came to work here. All the people I would talk to basically had the attitude that I was a loser for working for the government. They all had their finance and marketing jobs and were riding the boom of the ’80s. Having started at $6.40 and hour, I had to work two jobs to make it for a while. Let’s say it this way, without trying to be insensitive, I paid my dues and tightened my belt back then. If we, as federal employees are now sitting on the best jobs in the country it is because we already worked through the hard and lean times by taking the job in the first place.” Thanks. G-Man

Nearly Useless Factoid

This year, more money is expected to be spent on Valentine’s Day gifts for pets than on gifts for co-workers. I’m sure that has something to do with staying out of the doghouse, but I don’t know what it is.

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