San Diego Housing Bubble News and Analysis

Doesn't strike me as too out of line for the job and responsibilities. Considering the most appropriate comparison to the commander of the fire department would be a CEO of an equivalent sized company, it appears to me that like many in public service (not all, particularly politicians for life) they are a bit underpaid in comparison to the private sector equivalent, but the defined pension benefit largely makes up for that. I imagine a CEO that made it up the ladder quickly enough and retired in his/her mid-50's if they lived at a similar standard of living to the 165K/yr would probably have enough in retirement accounts to be able to count on a similar retirement income.

It really depends on whether you want your money front or back loaded - private sector tends to front load careers by paying higher salaries, but in turn requires that employee to largely fund and manage their own retirement.

Thank You Tracy Jarman for your 25 years of service.
Thanks for your service in earlier years on the HazMat response team, putting your life in danger, and working at below average salaries during the 80's and early 1990s. Congratulations.

It is ridiculous...thats why we are in this finacial mess...why should they have a guarenteed return, independent from market risks???? A sole proprieter would have to have a 2 million dollar retirement fund which yields 6% per year which would get you the $10,000 per month..

So obviuosly the fireman/woman didnt kick in this much him/herself...it is the taxpayers that are getting bled.

I guess I don't really have a problem with good salaries and pensions for police and firefighters, but retiring at 53? Come on! For those of us in the private sector who have our retirement in the markets, there is no way we're ever going to be able to retire at at even 65 and lots of us are going to work until we drop. I would like to see fire and police chiefs make it until at least 60 before they can retire.

How much do you think a similar position in the private sector would pay?

A CEO of a 1000 employee company (about the size of the San Diego firefighting force) probably would make at LEAST about 100K more per year than she did in terms of salary (and more likely, significantly more - and for what, in my opinion, is a lot less responsibility).

Basically, we, the public, are shorting them on their pay during active service, and making it up in terms of retirement benefits.

The public trough welfare queens never get enough.

If you were to study the life expectancy of police and fire 30 year employees it might help ease your pain and envy. The cold reality is that very few make it 30 years to get the brass ring and of those who do make it very few pull those checks for very long.

The "safety" employees have sweeter pensions, no argument there, but the average survivability is something like 7 years. Missed holidays, divorces, odd hours, life and death decisions that don't always go the right way, guilt, pain and being demonized for either bad decisions or undue rewards, take their toll on the body and mind. There is only a certain amount of death, destruction and pain that a human can encounter before it takes it manifests itself physically.

In this woman's case, do you think that pioneering an dangerous industry as a woman was an easy task, do you think she is without physical and emotional scar tissue.

I know everyone thinks what they do is hard and it probably is, but if it was a bet in a casino and you could choose a number of people with a variety of vocations, which do you think would live the longest in retirement? I would keep my money away from betting on the guns and hoses.

The average non police life expectency for males in the us is in the high 70's, police life expectancy is between 53 and 66 depending on the study (various studies for different departments, some including less traditonal "cops" like park rangers, federal agents, marshals, etc. but the best scenario is 66), I imagine fire is similar. For the boys and girls who strap it on and head into the actual fires or fights, they will live only into their fifties, so do you really envy them now?

I don't always care about a lot of people, but the cops, fireman and soldiers can have my tax money.

I don't think this is a valid argument for two reasons

1) It implies that the CEO's of private sector companies are fairly paid. (Highly dubious in my mind)

2) It implies that private sector and public sector are equal and comparable. (I wouldn't call this highly dubious as I did reason one, but I think this assumption definitely needs to be questioned.)

It would seem to me that a more appropriate criteria would include questions like:

1) Does this person bring enough added value to the organization to justify their pay.

2) Can this job be filled by an equally capable person for less pay and retirement.

Question 2 would seem to me to be the kicker. While I don't know the specifics, my bet is that there would be a number of good people in the firefighting organization that would be willing to take the job for a lesser salary and would be plenty competent to do the job.

The average non police life expectency for males in the us is in the high 70's, police life expectancy is between 53 and 66 depending on the study (various studies for different departments, some including less traditonal "cops" like park rangers, federal agents, marshals, etc. but the best scenario is 66), I imagine fire is similar. For the boys and girls who strap it on and head into the actual fires or fights, they will live only into their fifties, so do you really envy them now?

Ummmm I don't think this is the right website to be using the statistical mean as the basis for your argument :-)

Certainly average life expectancy is lower among these groups, but I'd wager that the standard deviation in life expectancy is much higher than in the general population due to the dangerous and stressful nature of the work. More low samples due to on-the-job deaths and the mean is of course lowered. That doesn't necessarily mean that a 60 year old retired firefighter is less likely to make it to 75.

I'm just sayin'...

You could use this argument against every position in every company, public or private, and wind up proving that virtually everyone is overpaid.

Besides, I think 250-350K is a pretty reasonable salary for someone in charge of and taking responsibility for a thousand person company (which were the numbers I was using as a minimum comparison against her salary). In fact, I'd consider that to be a bit on the cheap end. What I see as unreasonable are the 20+ million salary packages being paid out to a lot of CEO's.

Larry... very worth repeating!!!

A sole proprietor often has equity in the business that they can sell/cash out when they retire.

I've seen it happen a lot. Build a business - sell it, retire on the proceeds.

Sorry, I don't follow the logic of this argument. What I think you're saying is that if you use the two criteria that I outlined:

1) Does this person bring enough added value to the organization to justify their pay.

2) Can this job be filled by an equally capable person for less pay and retirement.

everyone at every company is over paid.

Can you support that view with something? Or if I've misunderstood your argument, please clarify for me.

My personal experience at virtually every company I've worked at (or run) is that in the private sector you have to ask that question continually, or your company will not be competitive and will fail. (Hmmmm... maybe that explains why a lot of companies are failing lately)

While I'm not sure how you would prove the point that top managers are overcompensated, my experience is that most people running large organizations got there (and are making the 250k-350k salaries you mention or even more) not because no one else wanted or could do the job, but because they were good at working the politics and self promoting. Often the best in our companies do not receive the recognition or the pay they deserve while the manipulative do. Just my experience though.

It's mostly based on #2, not #1 - because I think that previous arguments that were laid out support the fact that the chief in charge of a thousand person fire department probably does bring enough to the table to justify the pay - in fact, is (like many public employees) probably underpaid comparing what her skillset would command in the private sector (hence the retirement package). I think you'll find that many who go into public service go in with eyes open KNOWING that they will be compensated less on an annual basis than they could make in the private sector, but accepting that as a tradeoff to a more secure job with a defined retirement plan.

I suspect your #2 point above however, could be used against most employees, public or private - it seems to me that for any reasonably well paying position that you could always find someone who would be willing and could do the job for less.

However, I do agree with your other point, that most top executives got where they did not because their skills are necessarily better, but because they were better at playing office politics - however, this just goes to #2 above again. Considering argument #1, I still believe that in their position, with their responsibilities, no matter how they got the job, their pay is fairly well deserved.

A CEO of a 1000 employee company (about the size of the San Diego firefighting force) probably would make at LEAST about 100K more per year than she did in terms of salary (and more likely, significantly more - and for what, in my opinion, is a lot less responsibility).

Why are we comparing their salaries to other salaries that we generally consider excessive.. like CEOs..??
1) Public sector positions are virtually guaranteed for life, private sector jobs aren't.
2) With a private sector job, a mistake can destroy the company. With a public sector job, a mistake means that taxes are likely to be raised.. Higher job risk on the private sector.
3) Public sector jobs 'maintain' a status quo (they are in a guaranteed market). Private sector jobs have to innovate and fight to get their niche in the market place.

People make a big deal on risks to the lives of police. The reality is that it is described as being hours of boredom broking by seconds of sheer terror. The whole working day of a police officer is not the sheer terror.. This is also why you see so many police cars in a chase.. most of them are bored and this is some excitement.

As for survivability, I would like to see references to the studies.. By the way, life expectancy for whites is 78 for white, 73 for black (a 5 year deviation right there and 7 was mentioned.. making it 70?.. which is after retirement anyway). White male is 75.7, white female is 80.8..

my experience is that most people running large organizations got there (and are making the 250k-350k salaries you mention or even more) not because no one else wanted or could do the job, but because they were good at working the politics and self promoting. Often the best in our companies do not receive the recognition or the pay they deserve while the manipulative do. Just my experience though.

And it is even more so in the public sector.. because if there is a screw-up.. we just raise the taxes. Consequences on bureaucratic mistakes are less, so the system doesn't 'self-correct' as well. Bad CEOs are removed when their company goes bankrupt of the stockholders/directors vote them out. In the public sector, it tends to be a different story -- promoted diagonally.

At least she did not take a tax free "stress" retirement. Look at the CHP "Chiefs disease."

http://lists.cacities.org/pipermail/empl...

THANK GOD they are cutting that retirement plan. Good lord that thing would have milked us dry.

It is fraud and the best way to fix it is prosecute those who engage in it. Anyone with any serious time in law enforcement has some kind of physical damage. It is the nature of the work.

Or more likely, invest time and money, see the business fail.

The risks of termination/failure with public employment are minimal. You cannot claim job safety as a replacement for the lower compensation, and then defend $100K guaranteed pension (paid medical for life include?) with CEO pay.

Or you can.

Wrong. Fire chief is not CEO. You don't need to become an expert in finance, understand investment strategy, operations, staff with many distinct responsibilities. Plus (financial crash aside), when you run a company (that isn't too big to fail) you actually need to deal with issues of revenue, profit margins, credit. The list goes on and on and on.

Firefighters go to fire school (some don't). Learn industrial first aid and so on. They spend most of their time at the firehouse washing trucks (unless the station is downtown or some high density area where there is more action). The fire chief is a unionized government employee. No actual accountability. They pet a few dogs, kiss a few babies, and answer a few questions from reporters. Work 20 or 25 years and get their salary for the rest of their lives.

Actually, the Fire Chief is really just a politician not a CEO.

The last I heard, "servants" should make less than masters.

If the public servants start controlling the money and economy, then the roles get reversed and we are back to the feudal system that caused American colonists to flee Europe.

Jarman is the one who caused a sex harassment lawsuit against the city. She should have been dismissed with cause for that.

It strikes me as a crime against the citizens of San Diego.

Absolutely unreal.

Where I grew up the fire station was all volunteer. They put on a pancake breakfast once a year to raise money, everyone was there.

Young and naive, I thought SERVING as fireman was some sort of calling, respected in the community, compensated enough to make ends meet, but the compensation would have been the 3nd, 4rd, or 5th reason for choosing the career path.

Today, if I was in her shoes, I'd do the same thing. How times have changed and I'm only 34.

However jaded and cynical I have become, I could never have sat through interview after interview for promotion, spewing about how my subordinates and our city are so important to me, only to go out when it best suit me. I would prefer to retire a lowly captain self-respect intact.

Her total defined benefit pension (not counting DROP) is not $123,600 annually as the U-T story reported. It's $123,600 plus four years' credit, which buys an addition $19,950 annual pension. The total pension (again, not counting DROP) therefore is $143,550 -- plus 2% annual COL increases.

According to the Voice of San Diego article, if Jarman decides to pay out her DROP account as a 20 year annuity (guaranteed by taxpayers at 7.75% rate), she will receive annually a $33,344 payment from DROP.

Jarman's total annual payout first 20 years: $123,600 + $19,950 + $33,344 = $176,894 - more than her $165,000 salary. No WONDER she retired!

The lesson? GET A CITY JOB!
Posted by: Richard Rider, Chairman, San Diego Tax Fighters at May 30, 2009 08:34 AM

http://weblog.signonsandiego.com/weblogs...

Personally, I agree with TG on this one. I don't have a problem paying police/fire more considering their lifestyle and risk they put in, especially police/fire that work in sketchy areas. Beats paying COBOL programmer consultants $100-$200/hr to fix an antiquated CA state payroll system that can't be fixed, or hiring so many DMV workers and still having to wait in line 3-4 hrs. Also this the fire chief, it's not a worker bee firefighter.

You can say this or say that, but it is a totally messedup system if we pay our public employees more to retire than to work. Doesnt everyone hate the CEO's who fail golden parashutes? Well those parashutes are voted for by the board which is controlled by the share holders. Enough share holders vote against this kinda stuff and it stops. Well you are a voter here, you are a shareholder in Sd fire. Vote against it. If it isnt good for the private sector, it isnt good for the public one either.

And I would consider the mayor to be CEO of San diego corp. Fire chief in my mind would be more like a VP or department director.

Why not insert some common sense and free market ideas when establishing the level of compensation for senior city/country/state officials running major departments.

Let them earn the equivalent of private company CEO salaries but force them to manager their retirement benefits like everyone in the open market. I don't see why the city should insulate them from future risks by offering a defined benefit pension plan.

There is not shortage of people who would have taken her job and probably done just as well. Open these senior positions to completion rather the patronage politics that currently exists when filling these posts.

Lets say you pay her $500,000 per year to run the department. Five years work = $2,500,000

Under the current pay schedule her wages were $165,000 annually plus $120,000 per year for the remainder of her life.

Total cost until age 78. 5 years of work = $600,000. Retirements costs = #3,000,000 if her compensation is not indexed. Total costs = $3,600,000.

Imagine that costs across the board to the government (and us as taxpayers) as these senior posts are rolled over every few years.

You are assuming actuarial figures or life expectancy of 78, that's the rub. Career cops and firemen (not neccesarily cheifs) tend to drop dead within a few years of retirement. Their heirs don't get anything. Most of the studies i looked at today don't isolate fire people, they either lump cops and fire together or just study cops.

With all other gov't employees, the defined benefit thing screws the taxpayer, but in these cases it isn't such a bad deal except for the shocking numbers. 50% of 30 year plus cops are dead within 5 years of retirement, age 66 was the highest number I could find online and it included a sample size of 660,000. Look at retirement systems other than san diego city because they failed to pay into it for years and did overextend the benefits. S.D. county, pers (state) and others are only hurtng because of the stock market and for a long time the taxpayer made no payments because the cops were not getting much out of them. Where they got out of control was extending those benefits to all the other employees who do live till they are 80, allowing them similar benefits at 55, but they live 20-25 years as retirees, while the coppers shave 15-20 years off their life, not because they are killed at work, but because they are broken by the time they retire. Those same cops and firemen are not eligible for social security and their employers don't pay into it, they rarely live to collect it and that money is put into their pension, which isn't all that much more than ss, actually african american men should be allowed a similar exception because their life expectancy is below social security age, they are subsidizing old white women who live forever.

It's easy to say that they should have a 401k like everyone else, in many cases their family would be better off. Check a pension website, if on the day they retire they are not married and their kids are 18, if they die the next week, the pension fund keeps everything, their ex wives get nothing if they are dead, only if they are alive. If they marry after they retire, that spouse gets nothing, if their kids turn 18 before they die and after retirement, if before they turn 18, nothing once they turn 18, and these survivors get a fraction of their pension, not the whole thing and if the spouse at the time of retirement re-marrys, they are cut off. They tend to not reach retirement with a spouse at their side at the same rates that other employees do. If they quit before they are eligible, they get nothing, which happens more often than not. So if you look at the post above about saving money, it forgets that san diego pay nothing if that captain has a heart attack tomorrow, and the odds are against the cheif as far as living to 78.

With a 401k, that money will get paid out, the current system rolls it over for other retirees. After years of swelling pension funds, they decided to give them more to enjoy the few years they would have, where they got into trouble was they also decided that everyone should share the wealth, and the cubicle workers for all the governemnt branches tend to live forever.

Of course the cheapest pension system for cops in the world has to be china.

http://www.reuters.com/article/wtMostRea...

average life expectancy for a chinese traffic cop after 20 years on the job is 43. The pension office probably never has to replace it's pension check printer ink cartridges. if they gave them double their salaries as retirees, the taxpayer would actually win.

Another aside, those cheifs, both fire and police are not union folk, they aren't even protected by civil service, they are appointed or elected and their compensation is at the discretion of their political bosses and they can be removed, but I'm off track, I did not intend to defend them, just the men and women that are working right now, while I am comfortably enjoying my wine and enjoying my freedom, while they are not. There are also some soldiers working in some far away place, I owe them too. As soon as my tax money stops paying people to have 9 kids or watch jerry spinger and sit on the couch or bail out their greedy real estate investment, or AIG (they cost us far more than taking care of our brave) then and only then am i willing to discuss taking things away from the only tax recipients that i approve of.

Amen!
-------------------

Researchers found firefighters have a 100-percent higher risk of developing testicular cancer, a 50-
percent higher risk for multiple myeloma and non-Hodgkin's lymphoma, and for prostate cancer it's a
28-percent increased risk, compared with nonfirefighters.

http://www.eh.uc.edu/news/pdfs/lockey-01...

BTW, no freakin' way anyone can claim that a private sector employee is more responsible/liable than a public sector employee. In the private sector, the worst that can happen is you get fired. In the public sector, if you screw up, your face might be plastered across the newspapers with all the details of your mistakes, and if you're a cop, there's the risk that you can go to jail simply for defending yourself against a dangerous criminal with a rap sheet a mile long. If there's a public outcry, you can kiss the rest of your life (and the life of your family) goodbye.

Public employees in responsible positions (cops, firefighters, teachers) are often told to carry an umbrella policy, in the event of a lawsuit, because they can be held personally liable for very expensive "mistakes" -- BIG lawsuits which are rarely, if ever, seen in the private sector for similarly-compensated positions.

Government workers are much bigger targets for scammers because people perceive them (their employers) to have deep pockets. For this reason, public employees in responsible positions are kept on a much tighter leash, and are often fired if they do not perform or if they are perceived to be a liability to the employer. The myth that public employees don't get fired is totally false. People use a rare example from the news media to make a point, when the vast majority of public employees who commit the same offense would have been fired.

I've worked in both private and public sectors, and can say for a fact that the public sector has much higher standards for their employees than the private sector does. They require a higher level of education and experience, and public sector employees are much more closely scrutinized than their private sector counterparts.

If any of the complainers think these employees are overpaid and underworked, by all means...step up to the plate.

What's funny is that police and fire departments couldn't find enough qualified candidates during the boom times. Now that the some loser -- who's fresh out of high school -- can't make $80K/month as a mortgage broker, people turn on the public sector employees.

The nature of these jobs (very specialized training that cannot be transferred from jobs outside of these sectors), and the costs required to recruit and train new employees, means the govt employers cannot afford a high turnover rate. They need people who will stay there through the ups and downs of the economic cycles. That means they'll appear underpaid during the good times, and overpaid during the bad times.

BTW, how much is it worth **to you** to have well-trained, experienced law enforcement/safety personnel show up within minutes of your calling 911? When the difference between life or death for you (or your child, spouse, etc.) is determined by the timeliness and quality of care given, how much is it worth to you?