Rep. Jason Chaffetz (R., Utah) has made few friends in official Washington with his plan to empower federal agencies to fire employees who are habitual tax scofflaws. He has made a lot of enemies, and there are more of them than you’d expect: According to data from the IRS and the Office of Personnel Management, nearly 100,000 current federal employees are behind on their taxes. Not all of them are big offenders, but they are delinquent to the tune of nearly $1 billion — an average of about $10,000 each. If retirees collecting federal pensions and military personnel are included, the number is about 267,000, and they owe a total of about $3 billion.
Chaffetz is, in a sense, running with a political football he intercepted from President Obama, who in January called for legislation that would prevent the hiring of, and enable the firing of, private-sector contractors with tax delinquencies. Chaffetz signed on to that plan and added an amendment that would cover government employees, too. Because government employees are one of the most loyal and influential Democratic constituencies around, the Democrats balked. Some Hill hands have pronounced the legislation dead, but Chaffetz holds out hope and has scheduled hearings on the idea for next week.
In the present era of mind-boggling, trillion-dollar spending sprees and Godzilla-scale deficits, $3 billion is couch-cushion change — about what DARPA, the Pentagon’s mad-scientist venture-capital arm, plans to spend on its “metabolically dominant soldier” program. We’re not going to fix the deficit by putting a bunch of career bureaucrats and Capitol Hill staffers in an IRS headlock. But Chaffetz’s proposal is an important one because it targets the narcissistic culture of entitlement that plagues Washington, where the IRS itself is under the management of sometime tax miscreant Tim Geithner.
For a sense of scale, consider: If those 267,000 tax offenders were to incorporate as a municipality, they’d be the 71st-largest city in America, bigger than Madison, Reno, Jersey City, or Orlando. That’s a lot of noncompliance. If everybody in Orlando stopped paying taxes, you can bet that Disney World and the Lance Bass Birthplace Historical Site would be swarming with ravenous tax collectors. (In fact, it took only one Orlando native, Wesley Snipes, to bring down the full wrath of the IRS.)
And it’s not like Joe Bureaucrat can’t afford to pay his share of the taxes that support the governing caste. Federal workers receive salaries about 20 percent higher than those of private-sector workers in comparable jobs, according to Bureau of Labor Statistics numbers analyzed by USA Today. But it’s the benefits that really tell the story: The average private-sector worker receives health-care and retirement benefits worth $9,882 per year. The number for government workers? Try $40,785.
And that’s what chafes Chaffetz. “The IRS has the ability to dismiss [one of its employees] if they have ‘seriously delinquent tax debt’ — those are the words they use,” Chaffetz says. “And it’s not a coincidence that they have the highest compliance rate. We want to give the same ability and power to all departments and agencies.” Chaffetz detects an insalubrious sense of moral immunity in Washington, and intends to combat it: “Most people do the right thing. But for those who think they’re better than everybody else — they’re not going to like me, and they’re not going to like this bill.”
Chaffetz sees other evidence that Washington’s workers are too fat-’n’-happy. “One of the key indicators for me as a businessperson is that I look at the retention rate,” he says. “And it’s 60 percent higher in the federal government than in the private sector. That means we’re overcompensating our federal employees. They never leave, because they have such a sweet deal. We now have more people in the federal government earning $100,000 or more than earning $40,000 or less.”
And the numbers are going up — with speed: A year and a half ago, the Department of Transportation employed one person who earned more than $170,000 a year. Today that number is 1,600. Because whole bureaucracies’ pay scales are indexed to the salary of the agency head, there are terrible economic incentives built into the system: If the queen bee in any federal hive gets a raise, all the drones get a bump up, too — bad news for the taxpayers who keep the federal honey pot full. Given the sweet deal they’re getting, the least the federal workers could do is to pay their taxes.
– Kevin Williamson is a deputy managing editor of National Review.