Out of Control Compensations

There is justifiable concern in many quarters (including this one) over the often outsized bonus and compensation packages on Wall Street, Corporate America, and even in the professional sports world.  Ten, fifteen, twenty million dollar bonuses and annual sports contracts makes one wonder if the system isn't overloading the pay to producers to the detriment of capitalism,  the only successful and productive economic system for raising living standards the world has ever known .  It's a complicated and difficult issue but at least the extreme compensation we are talking about here is occurring in the private sector where the discipline of profit and loss are at work and owners who permit this compensation can always change it whenever they want.  Outsized compensation packages in the public sector is quite another issue since we're talking about something paid for by taxpayers who can't change what they don't know about.  We all know about the relatively large salaries and retirement benefits (perhaps not by Wall Street standards) paid out to federal lawmakers and sundry federal employees, but transparency regarding  the compensation of city managers,  heads of local community fire, police and other departments is virtually nonexistent.  Some information about this subject has been leaking out recently about abuses about some small towns in California that have gone bankrupt. City managers receiving compensation packages valued at well over 500 thousand dollars per year, firemen and police officers and penitentiary guards with upwards of 200,000 annual salaries plus generous retirement benefits, and so  forth.  One school in Orange County, California, Brandman University, a subsidiary of the better known Chapman University, several years ago created a master of public administration program to study various cities' compensation plans for employees.  This story in the Orange County Register provides major insights about what's going on with public service employee compensation these days and it's not a pretty picture.  To understand what's at the bottom of the constantly rising tax burden, begin by understanding the consequences of these city employees's compensation packages.  It is not a wonder that the majority of graduates of the vaunted California higher education system pick government work as their first career choice.