Cuts Mean Windfalls for Contractors

Contractors who are making big bucks helping Uncle Sam with national defense/homeland security could reap a major talent-and-dollars windfall if Congress slashes 150,000 federal jobs and lowers benefits for future retirees.

Many of them are watching in delight as politicians, in the name of economy, move to make government a not-so-great place to work. One proposal would trim take-home pay 5 to 6 percent.

Not that there is any connection, but contractors, using money paid them by the government, contribute a lot more money to politicians than federal and postal workers can or do.

Since 9/11, thousands of long-time federal workers from Defense, Homeland Security, Customs, ICE, the Secret Service and the FBI have left or retired to take related jobs in the private sector. They have several things that make them invaluable to companies that want to do high-security business with the government: A stable retirement benefit from the government, experience and contacts inside government, and must-have invaluable security clearances that are hard to come by.

Private contractors got a similar bump during the 1990s when President Clinton (to the applause of Congress) whacked 270,000-plus civilian federal jobs. Much of the work they had been doing was shifted to firms who paid their employees with money from the government.

Congress and the White House are considering major changes in federal pay, pension, health insurance and retirement rules. Earlier this week we asked readers if they planned to ride it out or bail out.

Wham! We got an earful. For example:

• “Looks like we need to do some voting, ourselves. I don’t have any problem voting the Senators and Congressmen out. It’s about time the millionaires felt the pain of the American people. They are so out of touch… ” Vietnam Vet
• “I have been a federal employee for over 36 years. I am not married nor do I have any children. So, basically, I’m on my own and I need to protect myself. If they continue to use us as scapegoats for decades of bad decisions made by them. I’m splitting. There is no honor in working for dishonorable people.” Sharon R. Grig
• “So certain members of Congress want us to join the race to the bottom. Instead of focusing on the Feds and making us scapegoats, along with teachers here in South Florida, why aren’t we focused on those top 1% in wealth, and tax them like they used to be taxed and should be taxed. How about taxing the outrageous bonuses bankers are getting? How about taxing those CEO’s who are making outrageous sums of money! How about closing tax loopholes for big corporations. We need our teachers, we need our dedicated Federal employees to stay motivated to do good work! Congress uses this tactic of focusing on feds to keep constituents from looking at the reality of unfairness and lack of funds in the government coffers.” Debbie in South Florida
• “Well Mike, when I get to retire, if ever, I just might have to go be a greeter at Walmart to supplement my retirement if the Administration gets its way. I thought things had already gotten ugly, but it’s easy to see that there is always a lot more ugliness to go around when it comes to money and spending. No doubt the private sector will totally agree that making feds suffer is only fair. Share the pain.” D.R. Bender, Pennsylvania
• “Are you serious?? Why stay and be further…um…screwed? I’m ready now and this is a push out the door! I do feel sorry for my colleagues who plan to work for 8+ years more. Now maybe 12+ years?” Lorna

To reach me: mcausey@federalnewsradio.com

Nearly Useless Factoid
by Suzanne Kubota

LifesLittleMysteries says the $10,000 bill is the most valuable U.S. currency now in circulation. It features the portrait of Salmon P. Chase, Secretary of the Treasury from 1861 to 1864.

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