I was sifting through the Austin-American Statesman this morning looking for an article for my 2nd blogging assignment for my government class when i discovered this article. I feel the article is an important read as it relates to both myself regarding my long-contemplated decision with finishing my 4 year degree and all of my peers in college. It discusses the University of Texas' executive staff and their pay raises. Most pay raises are between 1.6% to 13-15%, however there are some executive staff who have had pay raises in excess of 50% over the last 3 years. I understand that running a nationally ranked, prestigious university system with 14 campuses is a daunting challenge and I freely admit that I have not the first idea of the logistics involved, but I do have an idea of the size of the challenge. Managing over a dozen campuses, hundreds of buildings, sports teams, student activities, thousands of professors, and tens of thousands of students is a staggering task.
Administrators pay is not my concern. What is my concern is this: consider that in 2003 the 78th legislature deregulated public university tuition. Since then, tuition has increased 72% (Tx Higher Education Board). The Texas State Legislature found itself $10 billion in the red; the compromise was to deregulate public university tuition in hopes of increasing the tax base. It sorta worked. Keep in mind, we already had a faltering economy. We still have a shaky economy and having a Bachelor's degree is now questionable. What is the point in racking up $60K, $80K, or even $100K in debt if you are looking at a $37K/year job, if you can even get a job? President Obama has been imploring Congress to enact legislation to restructure student loan repayment proportionate to income. At least $100K in student loans would be manageable on a $37K/year job. Romney has no plans to reform student loans.
Lastly, we should consider one other important point. Why was the state of Texas $10 billion in the hole? Was it perhaps because of this? I appreciate what Texas lawmakers and their efforts, however I think we can safely say that most politicians are self-serving. I happen to be both a civil servant and a tax payer. I also happen to be a member of the COAERS, the employee retirement system for City Of Austin employees. The article above really upsets me. If you happen to be a tax payer, it should upset you as well. Here's why: as a City of Austin employee, I have to work 23 years to obtain a 69% pension of my last 3 years salary average monthly pay. This is funded by my own contribution of 8% plus a matching 8% by the city. Each year I work after that increases my pension by 3%, so if I work 30 years I would receive 90%. The COAERS board recently changed the retirement rules to mandatory 30 years service for a 75% pension AND recipients cannot withdraw until age 62. If an employee starts with the city at 24 and retires at 54, they still have to find a way to make their bills for the next 8 years. The theory of the pension plans' solvency is the expectation that most recipients only live for approximately 10 years and that the pool of employees contributing is constantly increasing. Back to the main point, the article highlights that legislators would have to contribute 290 percent to cover their "earned" benefits of $125K/year. Moreover, one representative presented an option for moving future legislatures to a 401K plan. Do I need to remind everyone of how well those fared in the economic downturn? I bet that the idea stemmed from a need to create solvency. Civic leaders and city planners have been asking departments to cut their budget every year for the last 10 years.
Side bar - Along the same lines of university execs and Texas Congressional members, I (along with my peers) was asked by our city council in 2008 to forego pay raises that year. We as an employee association did. The city manager promptly rewarded us by giving pay raises to my department's executive staff. They just called it "fair wage adjustment". I wonder if legislators ever considered cutting their pay, increasing their insurance premiums, or increasing their own contributions. I doubt it.
I know that a portion of my pension is carried by others, but certainly not to this degree. Remember what I said earlier about politicians being self-serving? I think that a more accurate statement of people who are in positions of power are self-serving, whether it be as an executive staffer of a public university, city departments, or in legislation regulating, or rather de-regulating said universities. I wonder if they realize or even care that they are continuing to expand the gap between middle and upper class America. The continual unrestricted increases of tuition and financial burdening of the elite upon the blue-collars is doing just that.
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