[an]

[quote=SK in CV]Because those numbers are talking about two different things. One is what the employee is paid, and the other is what the employer charges for the employee time. In professional services industries, employees never get paid what their employers charge for their services. It ranges anywhere from 2x your hourly pay to 5x your hourly pay. In IT consulting, that number is typically 2.5x. So if you’re paid $50 an hour, they charge $125/hr for your time. So to hire you out for a full year, it would cost the customer about $250K for the year. But that rarely happens. In contract IT consulting, 75% utilization is typical. (Unlike law or accounting, where >100% utilization isn’t uncommon, particularly for younger employees.)[/quote]
I thought you’re referring to individual contractor and not contracting firm. For contracting firm, I agree, it’s the same for my industry. I used to work for a contracting firm and we get paid around $45-50/hr and they’re charging the client $135/hr.

[an]

[quote=SK in CV]The $200K and $400/hr is an outlier. But in the space I worked, the $150K/$210 per hour is not. It’s the norm. And the $210/hr will cost well in excess of $270K a year to the customer. I don’t know what space you work in, but it’s not the only one out there.[/quote]
$150k is not out of the norm but $210/hr is. $210/hr is over $400k/year. How can $150k/yr be average yet $210/yr is also average. Unless you’re talking about very specialize skills that doesn’t need full time support.
I know my space is not the only space out there. But I know enough software engineers across various industries to know what’s the average going rate. My space is one of the highest paying space for a software engineer and have the highest demand.

[an]

[quote=CA renter]No, I didn’t contradict myself. It is cheaper to use government employees, but with the growth of certain industries being fed by tax dollars, that’s not always possible, nor desirable. The government is (IMHO) paying for things that we have no business paying for, but the lobbyists are extremely powerful, and they (the people who hire them) control who we get to vote for, how much we spend, and where we spend it. This is why we’ve been seeing the huge moves toward privatization, even though it’s more expensive and more vulnerable to abuse.[/quote]Bigger government anything is vulnerable for abuse. So, you might want to attack the symptoms but to me, it seems like you’re failing to see the root cause, which is big government and too much $ sloshing around in DC. If we cut spending, and force agencies to live w/ less, they might say, hey, it’s cheaper for us to do it ourselves instead of hiring contractor. Or, they can say, hey, we don’t need this process here, or we can stream line that process there. Etc. That’s what private sector has to do all the time.

[quote=CA renter]Some good resources to get a better understanding of the privatization movement:

http://dianeravitch.net/category/privatization/

This is more biased, but argues some of the anti-privatization points fairly well:

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=104&topic_id=5531195&mesg_id=5531195

And definitely read this:

http://www.pfaw.org/rww-in-focus/predatory-privatization-exploiting-financial-hardship-enriching-1-percent-undermining-d

It’s very important that people understand what’s going on WRT privatization and our government. Most important is that if we lose this battle, it will be almost impossible to turn back.[/quote]
Sorry but as soon as I read an article start by calling the opposition “right wing” anything loses its credibility for me. Again, as I just mentioned in my previous post, privatization is cheaper IF you get the government completely out of it. It’s more expensive if it’s government money paying private contractors. Of course it’s more expensive because there’s more over heads.

[an]

[quote=SK in CV]I was wondering whether that $135K was actually the cost of a federal employee doing the work rather than the salary. (those who aren’t as pedantic as I am might think they’re the same thing.) If so, that would make the actual salary probably around $100 to $110K, benefits would increase that to about $135K.

The term “computer engineer” can encompass a whole lot of different jobs. My last gig, I had 130 employees who could all be called “computer engineeers”, though not a single one of them could write code (that I’m aware of). And their average pay was right around $150K, average total cost per employee was $180K (average billing rate around $210/hr. But there were some that earned well over $200K and billed $400/hr. Sadly, we never did any federal govt work.[/quote]
I wonder the same about the $135k. I’m assuming that’s base pay, but I don’t know.

With regards to your $200k and $400/hr example, you and I both know that’s not the norm and we don’t know what is meant by computer engineer. IIRC, you brought this up before and it was some special system architect that is fetching that kind of pay, no? Your average “software/computer engineer” will not fetch anywhere near $400/hr. Using that example is as relevant as me using fresh grad fetching $40/hr. I have to use what the term is really used for in my industry, which means your peon developer.

[an]

[quote=CA renter]Some security clearances can take more than a year to obtain, and the top levels need to be re-investigated on a regular basis.

I don’t think you understand the enormity of handling all of the administrative duties and security clearances for all of those people. It’s much easier for them to go through a company.

This is one of the things that far too many people do not understand about govt work. It takes a tremendous amount of resources to recruit and train people, and the sheer number of employees working for the government is unfathomable for most people who work in the private sector, even to those who work for very large corporations.

By using companies, it’s easier to keep these individuals in the “govt fold,” where they might work for one public agency, and then another, then another, and then back to the original agency…but all under the control of one company. By using the company, all of the administrative work is streamlined and, once the relationship between company and the various govt agencies has been established, it’s easy to just tell them that you need a person with x qualifications for x amount of money, and then that person arrives as soon as they are needed.

And yes, it does prove my point about privatization being more expensive than the govt having its own employees. The privatization movement wants to **expand** government (especially as it relates to expanding government spending for private contractors), and they spend a tremendous amount of money lobbying to get this done. With govt employees, while they might lobby for better pay and/or working conditions, they do not usually lobby for expansion in the way that private contractors do, and they cost less per employee.[/quote]
I think you just contradicted yourself in this post. If it’s cheaper to do it in house, then why outsource? I never knew the privatization movement was for expanding government and increase government spending. If that’s the case, then I’m very anti privatization. What would you call completely offloading the service/job to the private sector then? Keep in mind that there are some jobs where I don’t think should be privatize. Jobs that need clearance are usually the one that needs to stay in house. In stead of paying contracting firms to do the clearance process that you set up. Why not just stream line the clearance process and allow your employee from one agency to move to another more easily. Streamline the process instead of paying extra money to not have to deal with the process.

[an]

I guess I wasn’t aware of outsourcing = privatizing. My definition of privatization is more of transferring the completely ownership to the private sector (for profit or non-profit). But I guess after looking into the term, it can mean either. So, I concede that if you’re talking about outsourcing, then yes, outsourcing will cost more. But if it’s transferring complete ownership, then that’s debatable.

You’re right, $135k vs $270k is almost exactly what I quoted. Although, that’s on the very high side. The $135k is also on a very high side to start with for just a software engineer, the $270k is very very high side. Also, wasn’t there some people who said government employees are underpaid because they have such wonderful fringe benefits? The $135k doesn’t bare out that claim.

[an]

[quote=CA renter]In most of the cases I’m aware of, the contractors in D.C. need special security clearances and are very specialized. That could account for most of the difference, though it probably doesn’t account for all of it.[/quote]Clearance does cost money but no where near that much.

[quote=CA renter]Like the Bay Area and the need for “mobile” engineers now, there was so much demand for contractors in D.C. that the rates went up very quickly over the past decade or so.

But yes, when you combine powerful lobbyists, lots of tax money, and the desire to “spend it into the economy, right now” there is a lot of room for all kinds of shenanigans. This is why I say that the #1 place to look for fraud and abuse is where public money and private enterprise meet. Always was the case, and always will be.[/quote]I totally agree with this. But I wouldn’t call this fraud. I just call it plain old capitalism. When you’re spending other people’s money, you don’t care about how wasteful you are. On the other end of that transaction. No one in their right mind would charge any less than what your customer is willing to pay. Did you or anyone you know say to their boss, it’s ok, you don’t have to pay me $X, you can just pay me $X/2 because I don’t think it’s fair to charge you $X? So, there you have it, a customer that spend other people’s money and the contractor who’s trying to get the most money for their work.[quote=CA renter]Also, though I do not know this for sure, the cost of the contractor might be the cost that the govt pays a private company for the contractor (usually the case as far as I’ve seen). This cost would include all the overhead and profit for the corporation, this is not necessarily what the contractor is receiving individually. There is a lot of bloat, as usual, where the middleman is concerned.[/quote]You’re probably right. I don’t know how the study calculated the pay, but if it’s just comparing base pay, then this is a faulty study. Now that I think about it, $135/hr sounds about right for what a high end contracting firm would charge a company. Those contracting firm is a business and does make a profit. They also have to pay for HR/Sales/admin/etc. people that the client doesn’t have to pay for, so part of that $270k goes to those people. Then of course, the company itself would take a cut from the top as well. Which is why it’s usually cheaper to hire directly instead of outsourcing to a contracting firm. The cheaper way would be to hire independent contractors and take care of the clearance, training, etc. yourself. But again, it’s probably easier to just outsource it to various different government contracting companies. After all, you’re not spending your own money, so why make your life harder.

So, this does not prove your statement:
[quote=CA renter]Thought this was interesting, too. I guess “privatization” doesn’t really save money, after all. Gee, who would’ve guessed?[/quote]
This isn’t privatization, this is government being lazy and and outsource the jobs to government contractors.

[an]

That’s your conclusion from that bold text? What I see is, leave it to government and they can waste a lot of money. Even contractors in the bay area do not make $270k/year. The reason is that companies would NEVER pay that kind of money for just a simple computer engineer. As a contractor, I would charge as much as the client is willing to pay. Who in their right mind wouldn’t. It’s the business or in this case, the government, job to control the cost. FYI, $135k is more than what a computer Engineer would make in the bay in the hotest sub market (mobile) right now. My conclusion is that government are not spending their own money, so no need to control cost. Contractors will bill as much as the government is willing to pay.

[an]

[quote=enron_by_the_sea]The funny thing, however, is that I just refinanced and the appraisal came in quite low – quite a bit lower than even late-2010, when I last refinanced. So I am not sure what to believe.

IMO even if there is great demand+low inventory out there, appraisers are not going to let the prices rise much for some time to come.[/quote]
I hate appraisers. Most have no idea what they’re doing.

[an]

[quote=craptcha][quote=AN]SK and CAR, if that’s your argument, then how do you have data to back up your claim when the things you claim hasn’t happen yet. The boomer haven’t enter retirement, so how can you be sure they will die as early as their parents’ generation? My argument is due to medical advancements today and going forward, boomers will live longer. We won’t know who’s right until 50+ years from now. So I guess we’ll just have to agree to disagree for now, until the last boomer die, then we’ll know who’s right.[/quote]

What is extrapolation?

That’s why it’s called expectancy. Once it is realized it is no longer expectancy (kind of like talking about probability that it rained at specific location yesterday).[/quote]
My point is, we all are extrapolating, so we’ll just leave it at that. No point in debating further. We’ll just wait till the last boomer die then we’ll see who’s right. Kind of like one person 2 days ago saying it’s 100% probably that it’ll rain yesterday while the other say it’s 0% chance. Today, we’ll know who’s right. Two days ago, those two people can at least give their data saying because of x,y, and z, I expect the probability it’ll rain yesterday to be xx%.

[an]

[quote=bearishgurl]The first “boomers” (born 1946 to 1947) have already or will this year reach 66 years of age. They are allowed to retire at 66 with a full SS benefit. The retirement age creeps up to 67 for those born 1960 and later.

http://www.ssa.gov/retire2/retirechart.htm

In general, boomers had access to health education in public schools as well as free public health vaccines (however primitive – ex. polio sugar cube). In addition, they were subject to warnings on cigarette pkgs from an early age. For these reasons and the “fitness and jogging crazes” of decades past, there are many more boomers alive and fit today to weather their later years in much better shape than their parents and grandparents (I like to think myself is included, lol).

For these reasons, I think many boomers will live longer than previous generations but I don’t know how many years longer, since longitivity is primarily hereditary. But I DO believe that boomers will live their “golden years” with far less disability than their predecessors and thus have a MUCH better quality of life overall, because of their advance knowledge of known health risks and implementation of a healthier lifestyle.[/quote]
Are we talking about medicare now instead of SS? It doesn’t matter why you live longer, if you live longer, you’ll drain more from SS. The question is, how much longer and how much more will they take from SS vs how much they put in. We won’t know till the last boomer die. My guess is, they’ll live much longer and they’ll take more from SS than they put in.

[an]

SK and CAR, if that’s your argument, then how do you have data to back up your claim when the things you claim hasn’t happen yet. The boomer haven’t enter retirement, so how can you be sure they will die as early as their parents’ generation? My argument is due to medical advancements today and going forward, boomers will live longer. We won’t know who’s right until 50+ years from now. So I guess we’ll just have to agree to disagree for now, until the last boomer die, then we’ll know who’s right.

[an]

[quote=SK in CV][quote=AN][quote=SK in CV]You totally missed my point. Total life expectancy is immaterial. Life expectancy at retirement age is what’s important. I think that number is 7 years higher now than it was when SS started.[/quote]Data?
Here’s the full retirement age for SS: http://www.socialsecurity.gov/retire2/agereduction.htm. Are you saying your generation total life expectancy is only a few months to <2 years higher than your parents', since according to SS's full retirement age, that's how much older you'd have to be to reach full retirement age. Yet, over the last 50 years, life expectance have gone up 9 years.[/quote]

I may have overstated it.

I can't quickly come up with newer numbers, but direct from the SSA:

Life expectancy at age 65 in 1940 - Males 12.7 Females 14.7

Life expectancy at age 65 in 1990 - Males 15.3 Females 19.6

I doubt life expectancy has increased any faster over the last couple decades, so I'm guessing the increase overall is probably closer to 6 years now.

And you continue to ignore the important number. It is not total life expectancy. It is life expectancy AFTER retirement benefits begin.

http://www.ssa.gov/history/lifeexpect.html%5B/quote%5D
Uh, unless math eludes me, life expectancy after retirement = total life expectancy - retirement age, no? If that's the case, it's it as simple as finding out what life expectancy is, then subtract the full retirement age?

Also, keep in mind medical advances has changed dramatically in the last 20 years. We're talking about the ability to completely regrow human parts from you own stem cell and do the surgery. With your own DNA, the likely hood of rejection is minimal, if at all. Then, there's also the fact that we're pretty close to finding the cure to AIDS. We're working hard to find a cure to cancer. Then there's nano-tech that doesn't exist 20 years ago and it will only get better 20 years from now. So, yes, I expect us to live much much longer.

[an]

[quote=SK in CV]You totally missed my point. Total life expectancy is immaterial. Life expectancy at retirement age is what’s important. I think that number is 7 years higher now than it was when SS started.[/quote]Data?
Here’s the full retirement age for SS: http://www.socialsecurity.gov/retire2/agereduction.htm. Are you saying your generation total life expectancy is only a few months to <2 years higher than your parents', since according to SS's full retirement age, that's how much older you'd have to be to reach full retirement age. Yet, over the last 50 years, life expectance have gone up 9 years. But that's really besides the point. What I'm trying to tell BG is, stop complaining about her parents' generation being a drain on SS, but fail to see her generation is doing the same thing.

[an]

[quote=bearishgurl]AN, that’s easy for you to say because you have only been working a few years. I’d like to hear how you feel about the matter 30 years from now … after reviewing your annual SS report :=0

We didn’t put in “a little more” than our parents did. Collectively, boomers probably put in 8-12 times as much as both Greatest Gen and WWII Gen combined! Remember that payroll FICA deductions (not sure they were called that back then) didn’t start until 1935 or 1936.

http://en.wikipedia.org/wiki/Federal_Old_Age_%26_Survivors_Insurance

The amount one “extracts” from the system is directly proportionate to how much they (or their “sponsor”) put into it. The problem is that it has minimum payments ($380 mo? regardless of contribution) and most of its current beneficiaries are overpaid every month in proportion to their contributions.

I am MORE than okay with taking my and my employers’ contribution as a lump sum when I am eligible for it, in lieu of a monthly “annuity.” I don’t even care whether they pay me any interest for all those years.

Actually, I think we should have the option of taking a lump sum of our contributions at 62. I’ve seen too many people die after working their entire lives without collecting a dime (exc spouse $250 benefit).

I can manage whatever amt it is from there. At least I will have collected it.[/quote]
Like I said, I have no expectation of getting any money I put into SS, so yes, it’s easy for me to say. I expect the boomers to drain the system and leave my generation with an empty coffer.

Do you have data to back up the 8-12x as you claimed? But again, that’s irrelevant. What’s the NET difference between boomers vs your parents generation, assuming average life expectancy will be 8-9 years longer yet retirement age won’t change nearly as much. I’m also pretty sure my generation will pay much more than your generation into the coffer as well. But I’m not optimistic in being able to get those money back through SS. If we do, that’ll be a pleasant surprise.

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