The 1 percent: D.C. metro area the wealthiest in the nation

posted at 4:45 pm on October 19, 2011 by Tina Korbe

Yet more evidence that the Occupy Wall Street crowd should march on Washington instead. The nation’s capital is also the country’s wealthiest metropolitan area, according to U.S. Census data. Bloomberg News reports:

Federal employees whose compensation averages more than $126,000 and the nation’s greatest concentration of lawyers helped Washington edge out San Jose as the wealthiest U.S. metropolitan area, government data show.

The U.S. capital has swapped top spots with Silicon Valley, according to recent Census Bureau figures, with the typical household in the Washington metro area earning $84,523 last year. The national median income for 2010 was $50,046.

Total compensation for federal workers, including health care and other benefits, last year averaged $126,369, compared with $122,697 in 2009, according to Bloomberg News calculations of Commerce Department data. There were 170,467 federal employees in the District of Columbia as of June. The Washington area includes the District of Columbia, parts of Northern Virginia, eastern Maryland and eastern West Virginia.

Let me parse one of those numbers a little bit. The average federal worker receives compensation of $126,369. OK, fine, right? I’m not about to cry “unfair” about a person’s salary and benefits, am I? Not when I’ve been criticizing OWS-ers day in and day out?

Actually, I am. First, remember that, even though federal workers pay taxes themselves, their salaries are also paid by taxpayers. Again, fine. As a society, we agree that government — especially our particular form of government — adds value to our lives and the economy by, among other things, enforcing property rights, without which enforcement the capitalistic system would struggle. We need a government, the government needs workers and those workers need to be paid. Federal workers deserve to keep the fruits of their labors no less than the rest of us.

But, secondly, let’s remember that the federal government isn’t fully subject to the marketplace. As The Heritage Foundation’s James Sherk explains, “The government earns no profits and does not go out of business. Competition for workers limits the government’s ability to pay below market rates. Nothing, however, prevents the federal government from paying its employees more than they would earn in the private sector.”

And, in fact, that’s exactly what the federal government does — overpays its employees. After controlling for differences in education, experience, occupation and other observable characteristics, federal employees earn hourly wages 22 percent higher than those of comparable private-sector workers.

Even Alan Krueger, the chairman of the president’s Council of Economic Advisers, concedes: “Federal government appears to consistently pay higher wages than the private sector for comparable employees.”

And what about those added benefits? The average federal employee’s benefits package is also greater than a comparable private-sector worker’s — by about 30 to 40 percent. Simply reducing federal compensation to market rates could’ve cut $47 billion from the deficit this year.

The federal government should be held accountable for the way it spends taxpayer money — and inflated federal pay seems to me to qualify as an irresponsible use of it. Taxpayers should demand better.

In the meantime, it’s not just federal workers that swell the wealth of Washington. Lawyers and lobbyists live large, too. The area boasts one lawyer for every 12 city residents — and an associate attorney in D.C. has a median salary of $186,250, compared with the national median of $123,521.

But, truly, the lobbyists take the cake (or, rather, scoff at us to eat it). Apparently, according to Bloomberg News, the D.C. area has attracted even more lobbyists of late. Bet you’ll never guess why! The health care overhaul and new financial regulations have driven lobbyists to D.C. in droves.

As the president of the DC Chamber of Commerce put it, “Wall Street has moved to K Street.”

That’s it, really. We all object to the way businesses buy favors — but there are fewer favors to buy when there are fewer regulations to seek to escape. Excuse me, Occupy Wall Street, but it’s hard to blame businesses and their lobbyists for doing what they can do to combat the unintended consequences of ill-advised rule-making without also blaming the overpaid bureaucrats who issue the ill-advised rules in the first place.


Related Posts:

Breaking on Hot Air

Blowback

Note from Hot Air management: This section is for comments from Hot Air's community of registered readers. Please don't assume that Hot Air management agrees with or otherwise endorses any particular comment just because we let it stand. A reminder: Anyone who fails to comply with our terms of use may lose their posting privilege.

Trackbacks/Pings

Trackback URL

Comments

We got ours so you go get yours.
/DC

ted c on October 19, 2011 at 4:47 PM

The states are the new colonies and D.C. is the king.

Exurban Jon on October 19, 2011 at 4:50 PM

‘More please’, says Reid.

Kissmygrits on October 19, 2011 at 4:50 PM

We got ours so you go get give us yours.
/DC

ted c on October 19, 2011 at 4:47 PM

Fixed.

fossten on October 19, 2011 at 4:51 PM

Not to mention those sweet benefits packages they get.

SouthernGent on October 19, 2011 at 4:51 PM

9-9-9

MNHawk on October 19, 2011 at 4:53 PM

How about a 10% tax surcharge for the pleasure of working in DC ?

J_Crater on October 19, 2011 at 4:53 PM

Don’t forget these are the same bureaucrats, lobbyist, and lawyers that write thousand page legislation like Obowmacare that no one is allowed to read…

… and exempt themselves from it.

But little children will die if you try to cut the budget…

/

Seven Percent Solution on October 19, 2011 at 4:54 PM

Damn. I’ve been in the wrong buisness, apparently.

OK, seriously, how many of us here didn’t already know or suspect this?

listens2glenn on October 19, 2011 at 4:54 PM

Great post, Tina.

Let me add one thing:

Many of these uber-wealthy in D.C. evade taxes and never get prosecuted if this comes out—if they are appointed by the right person in D.C.!!!

INC on October 19, 2011 at 4:54 PM

Get business out of government by making government bigger!

lorien1973 on October 19, 2011 at 4:54 PM

Paging bayam…

Del Dolemonte on October 19, 2011 at 4:55 PM

Hey, I see a certain class of folks to tax the whey out of!

DanMan on October 19, 2011 at 4:55 PM

It’s stunning to hear that D.C. beat the NYC metro area.

INC on October 19, 2011 at 4:55 PM

One big feeding trough.

a capella on October 19, 2011 at 4:57 PM

Excuse me, Occupy Wall Street, but it’s hard to blame businesses and their lobbyists for doing what they can do to combat the unintended consequences of ill-advised rule-making without also blaming the overpaid bureaucrats who issue the ill-advised rules in the first place.

oh shush your mouth Tina. This government is run by democrats and there is NO *up twinkles* WAY that there is going to be any blaming, protesting, or occupying nothing that is run by our precious democrats. When there is more Republicans in DC, then DC is where we* will* be* sister*!! **down twinkles**//

ted c on October 19, 2011 at 5:00 PM

also one of the only areas in the country not effected by Real Estate bubble.

jp on October 19, 2011 at 5:04 PM

This also explains the ridiculous housing prices in D.C.

SouthernGent on October 19, 2011 at 5:08 PM

To be fair $126K in DC is worth about $60K in St Louis or Dallas or Denver.

angryed on October 19, 2011 at 5:09 PM

also one of the only areas in the country not effected by Real Estate bubble.

jp on October 19, 2011 at 5:04 PM

no, it was affected. Some areas had price drops of 25% IIRC.

ted c on October 19, 2011 at 5:09 PM

ted c on October 19, 2011 at 5:09 PM

Georgetown wasn’t from what I understand. Where most of our policymaker elites live

jp on October 19, 2011 at 5:10 PM

Not to mention those sweet benefits packages they get.

SouthernGent on October 19, 2011 at 4:51 PM

I believe $126K is “total compensation” which includes bennies.

angryed on October 19, 2011 at 5:10 PM

also one of the only areas in the country not effected by Real Estate bubble.

jp on October 19, 2011 at 5:04 PM

no, it was affected. Some areas had price drops of 25% IIRC.

ted c on October 19, 2011 at 5:09 PM

Yes and no. DC proper and the immediate suburbs in NoVa/MD never really suffered a r/e crash. But further out in the VA/MD suburbs, r/e took a beating just like everywhere else.

angryed on October 19, 2011 at 5:12 PM

This also explains the ridiculous housing prices in D.C.

SouthernGent on October 19, 2011 at 5:08 PM

I suspect that if a real conservative becomes President and conservatives take over the senate, then the housing prices around DC will plummet as a significant percentage of the beaurocrats are kicked out!

Christian Conservative on October 19, 2011 at 5:13 PM

Also, they are not paying into SS and get hefty retirement benefits after 20 yrs.

rjoco1 on October 19, 2011 at 5:16 PM

They should be thanking us.

SlaveDog on October 19, 2011 at 5:18 PM

Paging bayam…

Del Dolemonte on October 19, 2011 at 4:55 PM

I 2nd that.

Chip on October 19, 2011 at 5:20 PM

I heard you and Ed discuss this in TEMS. Nicely done, Tina :)

beatcanvas on October 19, 2011 at 5:21 PM

I suspect that if a real conservative becomes President and conservatives take over the senate, then the housing prices around DC will plummet as a significant percentage of the beaurocrats are kicked out!

Christian Conservative on October 19, 2011 at 5:13 PM

A Republican may be prez. Republicans may take over the senate. But that does not mean conservatives will run either the WH or senate.

Romney as prez and Mitch McConnell senate leader with Boehner as speaker? Only slightly less depressing than Obama/Reid/Pelosi.

If I were a real estate agent in DC I wouldn’t be looking for a career change any time soon.

angryed on October 19, 2011 at 5:22 PM

We keep getting squeezed for public sector union gimmies, while many private sector employees are seeing freezes and cuts.

That “class” warfare thing is starting to look pretty good. Time for an Occupy Uniongoons protest.

Laura in Maryland on October 19, 2011 at 5:23 PM

This also explains the ridiculous housing prices in D.C.

SouthernGent on October 19, 2011 at 5:08 PM

One other thing: Why don’t we ever hear about the blight of suburban sprawl with regards to Washington and it’s nearby environs?

Chip on October 19, 2011 at 5:29 PM

To be fair $126K in DC is worth about $60K in St Louis or Dallas or Denver.

angryed on October 19, 2011 at 5:09 PM

But it is like $250,000 when they come down to NC and retire…this is government retirement haven…

right2bright on October 19, 2011 at 5:40 PM

So . . . send all those “occupy” street scum down to DC and let them tromp around Obama’s house.

rplat on October 19, 2011 at 5:49 PM

That explains why Washington never felt the recession.

GarandFan on October 19, 2011 at 6:09 PM

Excellent post, Tina.

Now how do we get all those fawning reporters around the country to discuss these facts? MSM is a giant FAIL so far.

fred5678 on October 19, 2011 at 6:12 PM

That explains why Washington never felt the recession.

GarandFan on October 19, 2011 at 6:09 PM

They just cause them; they’re too good to have to suffer through them.

Chip on October 19, 2011 at 6:13 PM

Christian Conservative on October 19, 2011 at 5:13 PM

angryed on October 19, 2011 at 5:22 PM

I want in the worst way to agree with you, Christian Conservative.

But if I were making a bet, I’d have to go with angryed.

listens2glenn on October 19, 2011 at 6:14 PM

Also, they are not paying into SS and get hefty retirement benefits after 20 yrs.

rjoco1 on October 19, 2011 at 5:16 PM

Not true. Members of Congress (and all federal employees) pay into SS. They had a different retirement system in the early 80′s in which they didn’t have to pay into SS, but they also didn’t receive SS. And the FERS is no different than any other decent company. You’re probably referring to that stupid forwarded e-mail where Members of Congress get a lifetime salary after a few years, etc etc etc, but while their retirement is nice, it’s also a full time job (unfortunately), so I would hope the benefits would be comparable, unless we want all multi-millionaires to be the only ones able to afford running for Congress.

NoStoppingUs on October 19, 2011 at 6:39 PM

NoStoppingUs on October 19, 2011 at 6:39 PM

They still get to retire about 10 years before those in the private sector.

angryed on October 19, 2011 at 6:41 PM

I think it’s time to

Occupy K Street

rockmom on October 19, 2011 at 6:46 PM

As one of those evil government workers in the VA suburbs a lot of what’s being said does not mesh with my own story. I initially worked as a contractor supporting a military command. After two years I was offered a GS job at the same command. I would now be supervising many of the contractors (and mil and GS) that I worked with. Nevertheless, in taking the job I took a pay cut, I lost leave time and my benefits were not near as generous (in particular medical).

So why did I do it? It offered stability for the family and a defined retirement instead of just a 401K. If you think I’m not paying into SS as a GS guy I assure you I am.

Also, I purchased my house in 2004 and just refinanced last year. The house did not appraise for what I paid for it despite 65k worth of improvements in finishing the basement and some exterior enhancements.

SoonerMarine on October 19, 2011 at 8:55 PM

Close the doors and shut the lights out on:

Department of Energy. They have been a failure of their mandate.

Department of Education. Have not educated a single child.

Bureau of Indian affairs. Have impoverished generations Indians.

The EPA. Turn this issue over to the states.

No more Czars for the President and limit the number of assistants that the first lady can have….like one secretary.

joelj31 on October 19, 2011 at 10:29 PM