COMMENTARY

September 22, 2004

The two Washingtons: public versus private employment

by Michael Vernon and Jason Mercier
Where is Vice-Presidential candidate Sen. John Edwards when you need him? If ever a case could be made for two Americas as the Senator often likes to make reference to, it can be found right here in Washington state.

Consider the difference in an individual’s potential earnings based on whether or not one works for government. Federal Bureau of Economic Analysis statistics show that working for Uncle Sam (or his cousins in state and local government) is an advantageous career choice. This fact is demonstrated when comparing the average wage of those in the public-sector with those in the private-sector.

In 2002, the average private-sector wage in Washington State was $42,297, while the average government worker’s income was $48,719, an astonishing $6,422 difference. Even more striking, in Kitsap County (home to Bangor Naval base) the average public sector salary in 2002 was $62,293 while the average private-sector employee earned only $27,428, a whopping difference of $34,865.

The irony of this shocking difference is that while the public-sector is able to ensure its payrolls by virtue of compulsory taxation, the private sector has been struggling to stay afloat in the midst of a tsunami of high taxes and regulations in the state.

Unlike the private-sector, public-sector wages are not established by the value placed on employees’ services by the public they serve. Public-sector wages are established without the checks and balances of the marketplace. Private-sector wages are based in-part on the level of service consumers receive when making purchases rather than the ability of an employer to obtain mandatory “contributions” from potential customers, as is the case with the government’s ability to tax.

Based on these facts, it is time to work toward one Washington, in which the private sector is able to flourish so that necessary tax revenue is available to fund the public sector’s payrolls. Continuing the existence of two Washingtons is an ongoing recipe for budget disaster.

Michael Vernon is a research assistant for the Evergreen Freedom Foundation, an Olympia-based policy research organization dedicated to free market principles. Jason Mercier is a budget analyst for the Foundation.

Contact: Jason Mercier | Budget Analyst | 360.956.3482

Evergreen Freedom Foundation P.O. Box 552, Olympia, WA 98507 Phone: (360) 956-3482, Fax: (360) 352-1874 Email: effwa@effwa.org