How should legislators be paid?

In recent weeks there has been some discussion about whether members of the California legislature should take a pay cut. One needs some history here first. In 1966 voters adopted a fairly substantial revision of the Constitution which among other things created the fulltime legislature. I think few voters today would buy the idea that we established a permanent improvement in legislative decision making.

California legislators are compensated in a couple of ways. First, they get a salary which is a bit under $120,000. But they also get a tax free payment to cover their expenses related to having two residences. That is currently a bit over $170 per day. But there is a glitch in the system. Per diem is paid in such a way that members a) get it full time for most of the first 6 months of the year and b) when the leadership is meeting, because they might get called back they also receive it. They also receive a state provided car lease.

Last December, when the state commission that was deciding on whether to give the members a raise, the Speaker's spokesman tried to make a comparison between the job that legislators do and those of top corporate executives. He said “If you compare it to the private sector, you’d be hard-pressed to find the 120 top officers of any corporation with a budget of $150 billion that would take the salary that legislators get and no pension or retirement benefits.” That may be technically true but its a silly comparison. When corporations show deficits of the size and persistency of our state budget, the senior employees and even directors get fired.

I guess I would make a couple of changes in the way members are compensated. #1 - I would raise their salaries. Perhaps to $150,000 or even a bit more. #2 - I would eliminate per diem. If they indeed bear expenses related to their profession, they can take those off their taxes the way the rest of us do. Per diem is a classic way for legislators to engage in rent seeking. It should simply be eliminated. #3 - I would eliminate the state car lease. If they need to drive to Sacramento or around in their districts, let them deduct the costs from their taxes. In both #2 and #3 - they would require pretty accurate records. #4 - I would require that any personal expenses from campaign accounts including things like meals and parking tickets (see the earlier post about Chair Rangel of the House Ways and Means Committee) be reported as personal income subject to a 1099. #5 - In any year where the budget is more than 14 days late, I would suspend their pay for the rest of the year. #6 Finally, in this budget year, I would have them adopt a reduction in salary from the base amount which equals to the net General Fund reduction from the prior year of spending. State employees are being asked to take a 2 day a month unpaid furlough and after all aren't our legislators also state employees?