You know what’s funny? Watching CSPAN. No, I’m serious! It’s absolutely hilarious watching these hack politicians from both parties fall all over themselves to get in front of the microphone and condemn the compensation packages on Wall Street. Why is this so funny? Have any of you ever examined what a U.S. Congressman makes in salary and benefits? They’ve got a lot of nerve condemning Wall Street for its excesses! Here’s a little background information for you. They get:
- Salary of $174,000 per year. (leadership gets more – Nancy Pelosi makes $223,500).
- They get a cost-of-living increase every year regardless of performance.
- An extremely generous pension for life that starts after as little as 5 years of service (it’s complicated and I won’t bore you with it, but you can get all the details here.
- Staff allowance – Reps. get about $1.3M and Sens. around $3.0M per year to hire staff.
- Expense allowance for travel, telephone, etc. Basically anything you can think of, they expense!
- Foreign Travel – as appropriated by Congress.
- Free Mail Service to their constituents.
- Free office furniture and equipment.
All this is for a part-time job. Remember, they are only in session about 125 days a year (hilarious video on that subject here). When Congress was first seated in 1789, they were paid $6.00 per day and only for the days they were actually in session. This remained unchanged for the next 66 years until 1855. Sixty-six years without a raise and now they give themselves a raise every year?!? $6 a day, that sounds good, let’s go back to that plan.
No, seriously, my proposal is for a straight compensation for performance plan for Congress. The rest of the world only gets paid when they actually do their job and do it well (ok not true for unions, but everybody else). So, what would a pay-for-performance package for Congress look like? Balance the budget, get a salary. Produce a surplus, get a bonus. But, run a deficit, sorry pal, no paycheck for you! It really is that simple. And while we’re at it, we can tie their staff compensation to a similar albeit less harsh formula. Something like deficit = 75% of salary, balanced budget = 100% of salary, surplus = 125% of salary. Any manager or small business owner can tell you that rewarding performance is the only way to actually get performance and yet we pay these people (and re-elect them) for failure year after year, decade after decade. Congress is failing us in every way. Both parties. Every day. Why do they still have their jobs? Why are they still getting a paycheck? And, how in the world can they possibly deserve a raise?