For all their hard work to attempt to solve the debt crisis, members of Congress receive pay of 3.4 times the average American worker, according to a new study by Our Generation and the Taxpayers Protection Alliance.
The study also found members of U.S. Congress are among the highest-paid legislators in the world. On average, legislators in other parts of the developed world receive salaries equal to 2.3 times the average wage.
So, how much is 3.4 times the average American worker’s pay? Try $174,000. But a high salary is not the only perk of the job. From the study summary:
In addition to a salary of $174,000 per year, which by itself puts members of Congress among the highest-paid 5 percent of American workers, members of Congress receive more generous fringe benefits than typical American employees. In fact, congressional compensation including benefits totals around $285,000 per year. …
The largest difference between Congressional benefits and those paid to private-sector workers is in the area of retirement benefits. Members of Congress participate in the Thrift Savings Plan (TSP), a defined contribution pension that offers more generous employer contributions than the typical private-sector 401(k) plan. Participants in the TSP are eligible for an employer contribution of up to 5 percent of pay, versus an employer contribution of around 3 percent of salary into the typical 401(k) plan. In addition, Members of Congress are eligible for a traditional defined benefit pension plan, which is more generous than the pension offered to other federal employees. Unlike state and local government employees, who generally must contribute around 6 percent of their pay to defined benefit pensions, Members of Congress contribute only 1.3 percent of their salaries. Regular federal employees pay 0.8% of pay, though they get a less generous benefiit even after netting out the contributions. Members of Congress may also be eligible for subsidized health care in retirement, a benefit that is uncommon in the private sector and less generous when it is offered. …
In total, Members of Congress receive contributions toward retirement benefits equal to around 47 percent of their annual salaries, or about $82,000. In the private sector, where the typical employee is eligible only for a 401(k) type pension plan and does not qualify for retirement health coverage, total employer contributions toward retirement equal around 9 percent of cash compensation. Thus, Congressional pensions are considerably more generous than those offered to private-sector employees.
Plus, our good men and women in Congress receive the equivalent of $14,000 in paid time off — and that’s assuming they only take half the time off of the average federal employee. Taxpayers contribute about $6,000 to each MC’s health and life insurance and another $9,000 to the employer’s share of Social Security and Medicare taxes.
But here’s the real rub: Taxpayers could save $39 million a year if members of Congress decreased their salary to $100,000 per year (still nearly twice as large as the average American worker’s salary of $50,875). Several proposals to reduce congressional pay are on the table right now. Congress might want to get a move on one of those proposals to demonstrate a commitment to — what was it again? — shared sacrifice.