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Archive for May 8th, 2011

I’ve never met Robert Murphy, but he is a reprehensible person. I don’t know if he’s as bad as Michael Wolfensohn, but he’s definitely a sorry excuse for a human being.

For all I know, Mr. Murphy goes to church every day, volunteers at a homeless shelter, reads books for the blind, and picks up litter in the local park. But he’s still a crook being because he thinks it is perfectly okay to steal so long as the government is the middle man.

You can tell me whether I exaggerate after reading these details. Mr. Murphy has been living for 30 years without a lease in a rent-controlled apartment in San Francisco. Every day he remains in the unit, he is stealing value from the owner, Wayne Koniuk, who would prefer to exercise his property rights by letting one of his sons live in the building. Here are the pertinent details from a local news source.

By trade, Koniuk fashions artificial limbs for amputees. By habit, he fits prostheses at no charge for people who cannot pay. This has left him a less-than-wealthy man. But he does have one substantial asset: a Divisadero Street building that his father, Walter, an orthotist, bought in 1970 and gave to his only son in 2001 so Wayne could run his business on the ground floor and Wayne’s adult children would always have a place to live. …Koniuk desperately wants to move his younger son into the building’s other four-bedroom apartment, he cannot. He is exploring legal options. Robert Murphy, who has lived there for 30 years without a lease, remains, paying $525.82 a month. Last spring, Koniuk offered Murphy $45,000 to move out. Murphy’s lawyer demanded $70,000, a sum Koniuk says he does not have. Meanwhile, the city’s Rent Board notified Koniuk that he was allowed to increase Murphy’s monthly rent this year by $2.63.

Not surprisingly, the government intervention that allows Mr. Murphy to steal from Mr. Koniuk is having terrible effects on San Francisco’s housing market.

In San Francisco, one of the toughest places in the country to find a place to live, more than 31,000 housing units — one of every 12 — now sit vacant, according to recently released census data. That’s the highest vacancy rate in the region, and a 70 percent increase from a decade ago. …Increasingly, small-time landlords like Koniuk are just giving up. One of his Divisadero Street neighbors has left two large apartments on the second and third floors of her building vacant for more than a decade, after a series of tenant difficulties. It’s just not worth the bother, or the risk, of being legally tied to a tenant for decades. …Perversely, that is hurting the city’s renters as well, as a large percentage of the city’s housing stock is allowed to just sit vacant, driving up rents that newcomers pay for market-rate housing.

I’ve mocked San Francisco in the past and I certainly enjoy a heaping dose of Schadenfreude when I see the failure of statist policies. But I also hate when big government and greedy interest groups screw over ordinary people. If I was Mr. Koniuk, I would visit this website to get some ideas on how to make life more…interesting…for the thieving Mr. Murphy.

(h/t: Greg Mankiw)

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Let’s start in Washington, where USA Today reports that there are “at least 17,828 federal employees whose annualized salaries totaled $180,000 or more in September 2010.” That’s rather distressing news for taxpayers, but these excerpts from the story provide additional reason for us to be upset.

…their ranks soared from the 805 with annualized salaries of $180,000 or more in 2005. Nearly 90% held “excepted service” jobs, meaning they worked at agencies that set their own qualification requirements and aren’t subject to the appointment, pay and classification regulations that apply to other civil service posts. …Light said he was surprised the federal data showed that 598 SEC lawyers ranked second among the largest employee groups with the top annualized salaries. The financial industry regulator, widely criticized for its failure to detect and stop Ponzi scheme architect Bernard Madoff, “hasn’t been doing its job very well, and yet its lawyers come out on top. That’s a shock, don’t you think?” said Light. Given the national concern with fighting crime, he questioned why federal prosecutors didn’t top SEC lawyers in numbers of highest-salaried attorneys.

Keep in mind, by the way, that the article is examining salaries rather than total compensation. And since bureaucrats generally get benefits that are four times higher than their counterparts in the productive sector of the economy, the gap between the bureaucratic elite and the serfs who pay their salaries is even larger than these figures suggest.

But at least the overpaid federal bureaucrats are mostly doctors and lawyers, so there’s at least some argument for high levels of compensation. If you want to read something truly outrageous, let’s travel to Newport Beach, California, where the city’s lifeguards are bleeding taxpayers in an obscene fashion.

…the city’s full-time lifeguard force has finally come under scrutiny. Next week the city council will decide if cuts are needed to the full-time lifeguard force where last year the top earner received $211,000 in pay and benefits, including a $400 sun protection allowance. In 2010 all but one of the city’s full-time lifeguard staff had annual compensation packages worth over $120,000. Not bad pay for a lifeguard – but what makes these jobs most attractive is the generous retirements. These lifeguards can retire at age 50 with full medical benefits for life. One recently retired lifeguard, age 51, receives a government retirement of over $108,000 per year—for the rest of his life.

The examples in this post are especially egregious, but the key thing to keep in mind that compensation levels for bureaucrats (at all levels of government) are far too high. I’ve posted this video before, but I’ll embed it again for folks who want to see some of the key statistics to prove that the government workforce is too large and paid too much.

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