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STATE

Does Higher Pay Attract Better Politicians?


state of the state auditorium standing

(photo via The Governor's Office)


After months of deliberating, a commission tasked with recommending salary adjustments for state lawmakers and executive branch employees met for the final time on Nov. 15 and did not suggest raises. The salary of New York state legislators has remained the same since 1999, and could stay unchanged until the commission meets again in another four years, as established by the 2015 law that created a new process for such pay raises.

Governor Andrew Cuomo and members of the Senate and Assembly could override their recent decision to leave raises up to a commission and pass compensation reform earlier. 

One of the main arguments made in support of raising lawmaker salaries is that a higher salary would “attract the best possible people to pursue the position,” since “a depressed salary will eventually discourage qualified people from pursuing those offices,” as Assembly Speaker Carl Heastie wrote in a letter sent to the commission Oct. 5.

Though the notion that increasing politicians’ pay is needed to attract better candidates to office may be quite disagreeable to the public, Heastie is not alone in that line of thinking.

Some government reform advocates, academics, and, naturally, Heastie’s appointee to the commission, Roman Hedges, have argued that better pay generates increased competition among candidates, leading to more choices for voters, and, as Hedges put it, would attract “the best people available” and create a “more professional Legislature." 

But is that true? The body of academic research examining this question has produced somewhat mixed results, though the findings generally support the claim. Most studies have shown that higher wages do result in increased political competition and attract more educated candidates (more college degree holders). Most research also shows that higher pay increases the rate at which incumbents seek reelection.

Some studies shows that higher salaries improve lawmakers’ performance in office (as measured by the number of bills submitted and approved), while others have found that lawmakers with higher salaries spend less time on legislative activities.

New York State lawmakers currently earn a base salary of $79,500 annually for what is technically a part-time job. Lawmakers may still hold employment elsewhere and earn outside income (and almost half do), and most lawmakers earn an additional $9,000-$41,500 annually from legislative stipends, or lulus, and also get per diems for traveling to Albany. 

Even though they haven’t had a raise in 17 years and the job is part-time, New York lawmakers are still the third highest paid in the nation, behind only California ($100,113 per year) and Pennsylvania ($85,339). How often state legislatures meet and how they function differ vastly from state to state, with some, like New Hampshire, paying its lawmakers only $100 a year in order to maintain a more citizen legislature. 

Had New York state lawmakers’ salaries kept up with inflation, legislators would earn about $114,000 annually. The median household income in New York is $58,687. New York City Council members recently voted themselves raises, to increase the base salary to $148,500 per year, but they also banned outside income and lulus, and are subject to a maximum of two four-year terms. There are no term limits in the state Legislature, which is “in session” from January to June each year.

Peverill Squire, a political science professor at the University of Missouri, has a body of research measuring the impact of salaries on state lawmakers across the United States. Overall, Squire has found that more seats go uncontested when legislative pay is lower (giving voters fewer choices); higher pay allows lawmakers to spend more time on their legislative responsibilities; and higher salaries are more likely to attract lawmakers who hold college degrees. For example, 88 percent of California state lawmakers, who earn $100,113 annually, have college degrees, while only 49 percent of New Hampshire state lawmakers, who earn $100 annually, have graduated from college.

Squire sent testimony to the New York State compensation commission, per the commission’s request, summarizing some of the findings from academic literature examining the influence of salaries on lawmakers. More professionalized legislatures (meaning legislatures that meet longer and supply lawmakers with higher salaries and more staff) pass a greater percentage of bills overall and enact more bills per legislative day.

Squire also noted that turnover declines as salary levels increase (the effects of which are debatable), and that lawmakers in legislatures with a higher degree of professionalization “have more contact with their constituents” and “are more attentive to their concerns.”

Some academics and policy experts caution against thinking of higher salaries as a panacea for Albany’s dysfunction. New York lawmakers are relatively well-paid among state legislatures nationally, yet that has neither deterred corruption in the state capital nor resulted in a more functional legislature.

The state Legislature is “more transactional than they’ve ever been,” said E.J. McMahon, research director of the Empire Center, a conservative think tank that studies the state economy and public policy. “At this point, by historical standards for sure, the Governor and the state Legislature, given their responsibilities, are not paid enough…but the Legislature stands out for how poor a job it does in many ways,” McMahon said.

“They introduce thousands and thousands of bills, do very little in the way of real deliberation,” McMahon added, highlighting frustrations raised in responses to a public opinion survey posted on the compensation commission’s website. “They’re as bad as they’ve ever been at waiting till the last minute to sheepishly go along and rubber stamp something that legislative leaders have cut a deal on” with the governor, McMahon said.

Adjusting the compensation levels of elected officials is a tricky situation for many reasons, especially because lawmakers inevitably have to prompt their own raise in some way, which is always a politically unfavorable move. And in New York, legislators living in and around New York City have a far greater cost of living than others.

“I think we need to pay people commensurate with our expectations of them,” said Gerald Benjamin, professor of political science and director of the Benjamin Center at SUNY New Paltz, who served on a compensation commission in Ulster County. Benjamin would prefer that state lawmakers do “full-time work for full-time pay,” in accordance with what is needed to “live reasonably as a family person in New York.”

Yet since that needed amount would differ in different areas of the state, “and compensation needs to be equal because of the nature of the task,” compensation would be skewed toward the higher end, and salaries should “be adjusted formulaically after a base is established…Pay must be targeted to open up the possibility to serve to a broad spectrum of New Yorkers,” Benjamin said. 

Benjamin’s suggestion calls attention to the difficulty of adjusting the salaries of elected officials based on one measurement alone, which is what led Italian economists Stefano Gagliarducci and Tommaso Nannicini to examine the relationship between pay and the quality of Italian mayors, as the wage of mayors in Italy depends on population size. Like New York state lawmakers, Italian mayors may also earn outside income. Gagliarducci and Nannicini found that higher wages attracted more educated candidates (as measured by the amount of years spent in school). 

Another study examined whether higher wages improve lawmakers’ performance in office, increase competition for office, and attract “higher quality candidates” amongst municipal councilors in Brazil after a constitutional amendment introduced caps on their wages according to population size, resulting in some legislators receiving higher pay than others. 

Economists Claudio Ferraz and Frederico Finan analyzed the educational and professional background of everyone who ran for municipal government in the year the amendment took effect, and tracked what the winning candidates did while in office. They found that higher wages increased political competition by attracting more candidates (though it also increased reelection rates among incumbent candidates), and attracted more educated legislators with more experience, though this effect was modest. As with New York state lawmakers, the role of a municipal councilor in Brazil is not a full-time position, and a majority of councilors still have an additional professional role.

Additionally, Ferraz and Finan found that higher salaries improved politicians’ performance in office, as measured by both the number of bills submitted by legislators and the number of bills approved, which they believe may be due to the higher incentive to be reelected.

However, not all academic research points to the same conclusion. In 2014, Columbia Business School economist Raymond Fisman and others analyzed the impact of salaries on the educational background of members of the European Parliament, and the performance of those MEPs while in office (as a law had just been introduced which equalized MEPs’ salaries, which had previously differed significantly) and found that increased salaries actually decreased the number of MEPs who came from highly-ranked universities.

Like Ferraz and Finan, however, Fisman also found that higher salaries also increased the number of incumbents who ran for reelection, and that higher salaries did “induce more political competition.”

Significantly, Fisman’s study found that MEPs whose pay increased did not become more productive in terms of their attendance at legislative sessions or their legislative output (including the number of reports prepared, written declarations, motions for resolutions, etc.). The researchers concluded that in this instance, “monetary incentives have no discernible impact on politicians’ effort, which seems more influenced by non pecuniary motivations.”

Fisman believes this could perhaps be the result of extrinsic rewards (more money) overriding the intrinsic ones (a personal calling to represent people). Though most academic research has found that higher pay does indeed increase political competition by prompting more candidates to run for office, Fisman’s findings suggest that higher pay may not necessarily lead to “better” representatives, though the additional money does attract some candidates who may not have otherwise run for office.

“There is a relationship between higher pay and inducing more people to run,” said Fritz Schwarz, Jr., chief counsel at the Brennan Center for Justice and chair of New York City’s 2015 quadrennial advisory commission, which was called to evaluate the salaries of the city’s elected officials and led to pay raises for City Council members, the Mayor, and other positions. “But I think it’s not a one-to-one relationship,” Schwarz said. “There are good people who choose to run with the low pay, and not everybody who is induced to run with the high pay is going to be Alexander Hamilton or James Madison.”

Another 2014 study, one which examined the salaries of state legislators and governors across the United States over the past 60 years, found that politicians in states with higher wages “spend greater time on fund-raising and on constituent services, but no more time on legislative activities.” Professors Elizabeth Lyons at the University of California and Mitchell Hoffman at the University of Toronto caution that their findings call into question the claim that increasing legislators’ salaries will improve the quality of state governments. However, their study did again find that higher salaries are associated with increases in political competitiveness, though the effect was modest.

Overall, most studies find that higher pay does lead to more competitive elections, which is good for voters, and generally attracts candidates with more years of education. Higher pay alone does not necessarily improve the performance of politicians while in office, which is itself tricky to define, though it does give them a greater incentive to get reelected, which may influence them to work harder to maintain their position.

Adjusted for inflation, New York state lawmakers are making less now than at most points since their last raise, in 1999. State lawmakers in California and Pennsylvania, the two states that pay their legislators more than New York, regularly see their salaries increased incrementally every year -- Pennsylvania's are pegged to a cost of living adjustment and in California a commission meets every year to adjust legislator salaries.

The question of whether or not lawmakers should receive a raise often becomes entangled by other questions: should they be able to earn outside income, or should the position be considered full-time? Should members who don’t hold leadership positions still receive stipends? Should pay be based on how effective lawmakers actually are?

Strong differences of opinion on these questions ultimately led to the state compensation commission’s failure to do the one thing it was called to do: recommend salary adjustments.

Government reform advocates, academics, and even some members of the commission were generally in agreement that New York state lawmakers ought to be paid a bit more, despite the fact that they are already the third highest paid lawmakers in the nation and Albany is still very dysfunctional. Governor Andrew Cuomo and his appointees to the compensation commission are, in fact, demanding other reforms to the position, like limits on outside income, in exchange for a salary increase -- something legislative leaders have balked at and called inappropriate given the duties of the commission.

“I think a lot of legislators in both houses, in both parties, are very frustrated with the way things work, and pay is a varying part of that frustration for some of them,” said McMahon. “But most of them are not going to be any less frustrated - they’ll simply be paid more and just as frustrated. They see how badly the system works and they’d like to change it, but they can’t figure out how to do it.”

***
by Meg O'Connor, Gotham Gazette
     

Read more by this writer.



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