EDITORIAL: We’re all in this together

Hutchinson made statewide news last week when a conservative public-policy group commended the city and several other local governments and school districts for controlling spending.

The Freedom Foundation of Minnesota used words such as “creative” and “innovative” to describe what Hutchinson has done.

What Hutchinson has done is adopt a wage freeze. Even the most ardent tax hater might not describe such a measure as creative or innovative, but it does get the job done.

By adopting the freeze, Hutchinson may save as much as $392,000 this year. That would make up for most of the $415,000 the city expects to lose in state aid.

The good thing about the freeze for taxpayers is that services will remain intact, unless the city takes further steps to prepare itself for a still deeper cut in state aid in 2010, which is likely.

The good news for city employees is that — until further cost reductions are decided upon — no one will lose a job.

State has done it before
Wage freezes are a relatively new phenomenon for local governments. It’s not new at the state level. A few years ago, Minnesota government employees saw their wages frozen when lawmakers enacted measures to respond to a huge budget deficit.

Back then the state’s approach to dealing with the deficit didn’t trickle down to local cities, counties or schools.

This year it is, but it’s feeling more like a cold shower. In fact, Gov. Tim Pawlenty has suggested withholding state aid to any local government that doesn’t enact a wage freeze.

Fortunately, Hutchinson and a few other local governments and school districts are already doing that. According to the Freedom Foundation of Minnesota:

< The St. Cloud School Board plans to reduce its own pay by 10 percent for 2009.

< Cottage Grove is reducing its spending by $1 million, including a wage freeze.

< Austin City Administrator Jim Hurm has declined a 3-percent raise, choosing to freeze his own pay at the 2008 level. The city’s mayor and city council have not raised their own salaries since 2001.

< Becker County is looking at working with other governments to share services. Now, this is truly a creative measure.

It’s a nationwide trend as well. In New York state, a small but growing list of school superintendents are forgoing raises. The freezes are “a way of saying, ‘Hey, we’re all in this together,’” said Michelle Hebert, spokeswoman for the New York State School Administrators Association, the union representing 7,000 principals and other administrators statewide. Also in New York state, Chemung County’s solid waste and sewer workers, who make up about 65 percent of the 900-person work force, agreed to forgo raises in exchange for a no-layoff clause.

Majority oppose wage increases
Local taxpayers seem to favor measures such as these. According to the Leader’s unscientific online reader poll, more than 60 percent of our online readers think no government or school employees should get a raise this year.

That’s quite a dramatic change in sentiment from just a year or so ago. Back then, a Leader editorial suggested that Hutchinson look at adopting a salary freeze as a way to deal with an expected deficit. The idea went nowhere.

What a difference a few disastrous months can make. While the economy continues to slide, more workers are simply satisfied to hold onto their jobs. Many companies have instituted wage freezes. And at some, such as the St. Paul Pioneer Press and St. Cloud Times, workers are being told to take a week off without pay. At Hutchinson Technology, workers who remain after last month’s layoffs saw their paychecks shrink by 5 percent.

Will this salary freeze/shrinkage continue? In the private sector, it’s inevitable, as long as the economy continues to spiral.

In the public sector, it depends largely on how taxpayers respond to employees’ pay increases. Will taxpayers be willing to forgo services so that public employees can receive salary increases? Will unions back off if they sense taxpayer backlash? How can one union retreat on its demand for a pay hike when other unions are successful in negotiating increases? Assuming that we’ll recover from this economic crisis, will workers expect larger-than-usual raises to make up for what they’ve lost after the economy recovers?

Those are just a few questions going through our minds. We’d like to hear what you think. Share your thoughts with us in a letter or online at www.hutchinsonleader.com. We look forward to hearing from you.

(Editorials are written by Publisher Matt McMillan and Editor Doug Hanneman. They can be reached at mcmillan@hutchinsonleader.com, or hanneman@hutchinsonleader.com.)