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Increasing wages will not save Salem money

January 23, 2011
Morning Journal News

Is it just us, or were you baffled by Salem City Council's vote to increase wages to help offset the amount elected officials are now being asked to contribute to their pension plan?

Wasn't the idea to save the city money when they suggested asking officeholders to begin contributing their share? Then ... how will increasing their wages result in savings?

Salem employees and officeholders should have been paying for their contribution to the pension fund all along, but we're finding out that many of our governmental entities also pay the employee portion, for at least some workers.

Now that Salem is financially strapped and has finally decided to make officeholders pay their fair share, doesn't awarding raises to help them pay for it negate the whole solution?

Fortunately for Salem taxpayers, council Thursday night backed away from a plan to also give a one-time raise of $1,800 to the mayor, city auditor and law director to help them pay for the 20 percent they are asking them to pay toward their own health insurance.

How many people in the private sector even have a pension plan? Most now have 401K(s), and, in some cases, their employers contribute a portion as a match for what the employees put into the fund. And most private sector employees have been paying a significant share of their health insurance for about a decade.

It's a good thing that Salem residents voted to reinstate the reciprocal tax agreement and voted down the income tax increase, or there would be even more money for officials to fritter away giving each other raises.

It's obvious that the current administration and council haven't got a clue as to how to handle taxpayers' money, especially in a down economy. Mayor Jerry Wolford was right when he noted that council members do not receive nearly as much as someone making similar decisions on a corporation board. But, unlike governmental boards, those seated on corporate boards are responsible for generating money, not just spending it. And ... if board members of a corporation exhibited the same financial record that Salem's administration and council have, they would quickly be fired by stockholders.

Salem voters and taxpayers should keep all of this in mind at election time and look for officials who truly understand the concept of fiscal frugality.

 
 

 

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