How Much Should a Bankrupt City Pay Its Retired Police Officers?
With Stockton, California, officially bankrupt, one of its luckier residents, Tom Morris, once again finds himself in the news. His $204,000 per year pension is seen as a symbol of the public employee excesses that helped push the city into insolvency. $204,000 is a lot of money most places in America. The San Joaquin County municipality is no exception. The average median household income there is $45,700 per year. The vast majority of its residents can scarcely imagine retiring at age 52 and receiving more than $200,000 every year for the rest of their lives.
That's why Bloomberg News led a recent story with an anecdote about Tom Morris, why the San Francisco Chronicle republished it, why Matt Welch of Reason noted it, and why it intrigues me too.
The national media is only rehashing a debate they've been having in Stockton for awhile. A local newspaper story from 2008 helps explain the career trajectory of this controversial man. "Born and raised in Stockton, Morris joined the department as a junior cadet in 1972 and became an officer in 1979. During his career, he has served as a patrol officer, SWAT team member, homicide investigator and in the department's Internal Affairs Division," the piece states.
Retiring on "principle" apparently had the salutary benefit of a pension that would pay out more than his annual salary. Said the article:
Morris said his decision was not motivated by money but by principle. "Money wasn't the issue," he said. "Just don't take away what I've already earned."
He has a wife and two kids.
When Morris assumed leadership of the Police Department in March, he said he would stay for three to five years, barring any personal matter that might force his retirement. The furlough, and the resulting loss of income, is that personal matter, he said. He has to consider the effect on his family, he said.
"In all my years in law enforcement, they've taken a back seat," he said.
Morris said he tried to negotiate with the city to make staying palatable - offering to surrender vacation days - but was unsuccessful. "I'm not looking for a way out," he said. "I'm looking for a way in."
He never found one that satisfied him. After he retired, Morris began looking for another job. After all, he was only 52. Columnist Michael Fitzgerald picked up the trail in 2009. "Shortly after he resigned as Stockton's police chief in October 2008, Tom Morris went after a job as an investigator with the San Joaquin District Attorney's Office," he wrote that April. "Morris was chief only eight months. But this modest stint enabled him to retire on a chief's pension of approximately $16,200 a month. To this pension he has added an investigator's wage, which, at the high end of that position, is $5,332 a month. So Morris is making $18,000 to $21,000 a month, earning in one month the greater part of what the average Stocktonian earns in a year, if you believe the census." I do believe it.
The columnist then does us the favor of letting us hear from the man himself:
I called Morris. He said he never really wanted to quit the PD. But he disagreed with City Hall's chain-saw approach to the budget crisis. They weren't listening to him, he felt. "I was very blessed to be able to touch the top of the flagpole," Morris said of his career. "Now I can actually go back and enjoy the work of putting away the people who are making life miserable for others." Morris said he could have applied to become police chief elsewhere. But he prefers to go back to his roots as a cop, doing work he loves, in a city he loves. He's not ready to retire.
I expected him to dismiss as sour grapes the criticism, and the perception that he's all about money. He didn't. "To be honest with you, I wish I could just blow it off. I don't, because it does bother me," Morris said. "Those people who say that about me either don't know me and don't know the circumstances. I care about this town, and I care about the police department more than a lot. So when you ask me, does it bother me - sure it does."
This would seem to miss the point. Though I don't know Morris, I never imagined he was "all about money." No one is. I don't doubt his affection for policing or for Stockton. (He's plenty rich enough to move.) Perhaps he acted unethically by reneging on his commitment to head the police department for a lengthier period. Perhaps the furlough and corresponding salary reduction absolved him of that obligation. What we can say is that compensation deals like his played a large part in driving his municipality into bankruptcy, a state of affairs that includes massive layoffs, significant service reductions, and a lot of pain for residents who do not earn close to six figures, even though they go to work everyday rather than enjoying an early retirement.
Wrote the local columnist back in 2009:
It's a funny situation. The public dozed right through the period when public employee compensation went off the hook. Now they're fuming because they didn't attend the meeting. I don't like overcompensation. It's hurting cities. But maybe a cop who is paid well because he rose through the ranks on his own merits and served honorably is the wrong guy to blame it all on.
Again, this rather misses the point. The public "dozed" through the period when public-employee compensation went off the hook because Democratic legislators, Governor Gray Davis, and countless local officials from both parties colluded with public-employee union negotiators to raise retirement benefits, especially for public-safety employees, to reckless and unsustainable levels. They often did it as quietly as possible, using backroom deals and closed contract negotiations, all the while citing forecasts for stock market returns to pension funds that were wildly unrealistic. All this occurred at a time when Californians were so fed up with their leadership that they in fact recalled Gray Davis in an election where his giveaways to the public-safety employees were an Issue. I recall talk-radio hosts ranting about them daily in drive time.
It is fantasy to think the average voter can comprehend and be regularly attentive to returns to pension funds, obscure labor contract negotiations, or loopholes that permit public employees to spike their last-year salary in a way that yields them a pension much larger than the casual observer might expect. While California voters can be faulted for their disastrous ballot box budgeting and unfailing loyalty to Democratic legislators despite their poor stewardship of the state, the people's blame is mitigated by the fact that the inept California GOP continues losing with lackluster, inexplicably socially conservative candidates while the state's fiscal outlook crumbles.
A healthy society depends on a political system that reins in special interests more than California's public-safety unions are reined in; it depends on competitive elections between political parties more functional than the California GOP; it depends on public servants at the highest levels of leadership who are less mercenary and more critical of a system that pays them so much more than their worth or that can be sustained (it has come to literal bankruptcy); and it depends on politicians and voters who don't permit some public employees to extract so much -- no class of people wouldn't be tempted by $204,000 for life starting at 52, if they could get it.
It's time to stop giving it to them.
Tom Morris probably isn't a bad guy, and he isn't "the problem," just a manifestation of it. But can we all agree that he makes too much? The Democrats who rule the California legislature ought to agree to common sense reforms, but they're mostly in safe seats and beholden to public-safety unions, so they dawdle, unwilling even to go as far as Democratic Governor Jerry Brown, as municipality after municipality declares actual bankruptcy and the state itself faces a fiscal cliff. "Many cities are hobbled by retiree obligations that consume 10 percent or more of revenue," Bloomberg reports. "And unlike other expenses, which can be cut or deferred, pension costs are intractable."
It's a bankrupt system.
This post originally appeared on The Atlantic.