[WHAT’S AHEAD FOR FEDS IN THE TRUMP ADMINISTRATION] 1
What’s Ahead for Feds in the Trump Administration
The federal government often has been likened to a battleship cruising at sea. You turn the rudder at this
point, but the ship itself doesn’t turn until farther ahead.
But turn it will.
That’s a lesson for federal employees in the election of Donald Trump as President—someone with an
oft-stated disdain for government in general but no actual experience in captaining even the smallest
rowboat on that battleship. And with few specifically stated plans for where he wants to take the ship,
when, and how fast.
However, there is an available crew of deckhands who have sailed these seas before. Mostly they consist
of current and former Republican members of Congress, their aides, and former political appointees under
earlier GOP administrations—what effectively was, over 2009-2016, a government in exile.
They come with pre-formed notions about the course to set. Some of those have at least some bipartisan
support, having advanced at least partially in an environment where the White House was under
Democratic control.
Other of these ideas are exclusively, or almost exclusively, Republican in nature and, for example, have
passed the House with its strong GOP majority in recent years but stalled in the face of White House
opposition.
With Republicans in now in control of the House, Senate and White House, chances of enacting those
ideas are greatly increased, if not guaranteed.
One of the few specific documents pointing the way for Republicans is a platform they produced at their
2016 convention, which had this to say in general about the federal workforce:
“We recognize the dedication of most employees of the federal government and thank them for
their service, with special praise for the whistleblowers who risk their careers to expose waste,
fraud, and misuse of power . . . The inability of federal managers to discipline and, if necessary,
dismiss problem staff members is an affront to every conscientious worker, as is the misuse of
funds for lavish conferences and routine bonuses. The appointees of a Republican president will
work with career managers to end those abuses and enforce high standards for all federal
employees. We reaffirm the existing protections that provide all employees of the federal
government the opportunity to pursue their desire to serve their country free from
discrimination.”
Following is a look at some of the major initiatives that may lie ahead.
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Pay and Benefits
The Republican platform from this summer had this to say about federal employee compensation:
“The federal workforce is larger and more highly paid than ever. The taxpayers spend an average
of $35,000 a year per employee on non-cash benefits, triple the average non-cash compensation
of the average worker in the private sector. Federal employees receive extraordinary pension
benefits and vacation time wildly out of line with those of the private sector. We urge Congress to
bring federal compensation and benefits in line with the standards of most American employees.”
While no further specifics have been provided by the Trump team since that summertime document, those
positions fall in line with those that Republicans have generally advocated for many years. The result has
been numerous attempts to reduce benefits, or at least to hold down the rate of growth.
For the most part, under the Obama administration, this resulted in the House passing a budget outline
containing such provisions and the Senate then not taking it up, due to White House opposition. However,
several half-a-loaf compromises were accepted during those years, as part of deficit-cutting measures.
That resulted, for example, in two separate laws that increased the required contribution toward retirement
for FERS employees, leading to FERS employees paying one of three levels of contribution, depending
on the year they were hired - all for the same benefit.
With both political branches of government in their control, Republicans could well revisit ideas such as:
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Raising the required contribution for all employees, regardless of when hired, so that the
employer and employee share would be equal. The exact amount of the required increase
would vary by retirement system—and in the case of FERS, by how much the employee already
is paying—but generally speaking, the employee share would have to go up by about 6
percentage points, that is, by 6 percent of pay.
Ending the “special retirement supplement.” This is generally paid to FERS-covered
employees who retire before age 62 until they reach that age; it duplicates the Social Security
benefit they earned while under FERS until they can claim Social Security.
Basing retiree COLAs on the “chained” CPI. This variant inflation measure attempts to
account for changes in spending patterns as the price of roughly interchangeable goods varies.
(The classic example is: if the price of beef spikes, people will buy less of it—buying chicken
instead, for example—and thus the current measure assuming that people will continue to buy the
same amount but at a higher price overstates actual spending.) The result of changing CPI
measures would be to shave about a half-percentage point off the annual increase, on average.
Reducing the payout of the TSP’s government securities G fund. Currently the fund pays
interest at a rate about equal to mid-term government bonds even though the fund carries none of
the downside risk of investing in anything but the shortest-term government securities. (That is,
the risk that interest rates will go up and the bond will lose face value.) Under the proposal, the G
fund return, which in recent years has been around two percent, would be set instead at the
shortest-term rates, which are barely above zero.
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Instituting a “voucher” system for the employer contribution toward FEHB premiums.
Currently, the government share is calculated according to a two-part formula that results in the
government paying about 70 percent of the total premium cost. Under a voucher system, there
would be a dollar amount employer contribution, which would be increased annually only by the
general rate of inflation, not the usually much higher rate of inflation in health care.
Also on health care, the Trump team has made repealing the Affordable Care Act a priority. This likely
would have little impact on the FEHB except for the provision that made children eligible for coverage
until they turn age 26, compared to 22 under the previous policy. Given the popularity of the higher limit
nationwide, that provision might be kept despite a general repeal; if it isn’t retained, OPM might move
administratively to keep the higher age in the FEHB.
As regards pay raises, Republicans generally question the value of across-the-board increases, saying that
raises targeted by performance (and to occupations in high demand) are more effective. The last major
attempt to institute a performance pay system occurred in the George W. Bush administration at the
Department of Defense, eventually covering some 200,000 employees. However, after a few years of
operation—in which many, but certainly not all, employees complained that they system operated more
on personal favoritism than performance—it was repealed in 2009 with the Democrats then in control of
both the White House and Congress.
Whether the new administration will want to expend the effort to try something like that again is
unknown.
In terms of annual increases, by remaining silent in each of the last four years, Congress has allowed
raises in the 1-2 percent range to take effect by default. That could signal continued willingness to pay
raises in that range, but larger raises—such as the 5-6 percent range that federal employee organizations
advocate—are another matter.
Job Security
A campaign position paper said that a Trump administration would order a hiring freeze “to reduce
federal workforce through attrition (military, public safety, and public health).”
Past Republican budget plans had recommended much the same, with various formulas—some a
complete ban, except for such positions, and some a modified version, for example allowing the hiring of
two employees for every three who leave positions not exempted. Most commonly, they set a goal of
reducing the workforce by 10 percent over four or five years.
Hiring freezes are nothing new in the federal government, of course. They date back at least to the Carter
administration. There was one at the outset of the Reagan administration, and individual agencies have
imposed them from time to time since then due to budgetary restrictions, in order to avoid reductions-inforce, or RIFs. The largest recent example occurred in 2013, when many agencies—including the largest,
Defense—imposed them in the face of “sequestration” budget limits.
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During such cutbacks, temporary employees often are the first to go, as agencies simply do not extend the
terms of those positions and refrain from hiring others. But temporary employees make up only a small
part of the federal workforce, and it’s questionable whether normal attrition—people leaving to retire or
for other reasons—could be enough to hit a numeric target. If not, agencies most commonly offer earlyouts and buyouts, but even those might not be enough to stave off RIFs.
One thing most hiring freezes have in common is that they all melt eventually, often because the
remaining workforce no longer matches the work that needs to get done.
The same campaign document meanwhile called for tripling the number of Immigration and Customs
Enforcement agents, and Trump administration priorities in certain areas likely would create new jobs in
areas such as Defense and border protection.
On the other hand, agencies such as the IRS and the EPA could consider it a victory not to shrink
considerably. The Republican platform had this to say: “Republican budgets will prioritize thrift over
extravagance and put taxpayers first. We support the following test: Is a particular expenditure within the
constitutional scope of the federal government? If not, stop it. Has it been effective in the past and is it
still absolutely necessary? If not, end it. Is it so important as to justify borrowing, especially foreign
borrowing, to fund it? If not, kill it.”
Disciplinary, Appeals and Other Personnel Policies
The GOP platform says, “a Republican administration should streamline personnel procedures to
expedite the firing of bad workers, tax cheats, and scammers.” That’s been a common theme of
Republicans in Congress in recent years—even though the percentages of such employees are tiny
compared with the entire workforce—and has support from senior advisors to the Trump campaign and
transition team.
The most specific guide to how this might translate into policy comes from a campaign position paper
specifically addressing the VA, which due to the scandals there and perceived lack of accountability for
them, has become a kind of poster child for proposals to reform disciplinary practices and appeals rights.
It says a Trump administration will:
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“Use the powers of the presidency to remove and discipline the federal employees and managers
who have violated the public's trust and failed to carry out the duties on behalf of our veterans.
“Ask that Congress pass legislation that empowers the Secretary of the VA to discipline or
terminate any employee who has jeopardized the health, safety or well-being of a veteran.
“Create a commission to investigate all the fraud, cover-ups, and wrong-doing that has taken
place in the VA, and present these findings to Congress to spur legislative reform.
“Protect and promote honest employees at the VA who highlight wrongdoing, and guarantee their
jobs will be protected.”
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That amounts to support for a number of proposals pending in Congress to speed up the disciplinary
process and limit appeals rights for VA employees, moving beyond provisions applying only to the SES
there under a 2014 law (a law the Obama administration has decided not to enforce).
Making such changes at the VA likely would be the first step toward government-wide changes.
Another area of focus will be whether Obama appointees “burrowed in” to career positions. Senior
advisers have said the administration will actively search for such conversions, which they see as planting
people in the government who will obstruct the new administration’s priorities—a view shared by every
incoming administration of the different party than the outgoing one.
However, the issue is much more a symbolic one than a practical one. A recent GAO review of 30 major
agencies over 2010-2015 found only 69 conversions, all but 17 of which received the needed approval
from OPM; in those cases, agencies generally said they didn’t request approval because of the complexity
of that process. OPM later reviewed those conversions and deemed only four improper. The findings
essentially mirrored those of a 2010 GAO report covering 2005 to 2009 that identified just 117
conversions at the GS-12 level or higher; all were deemed proper except seven, with records not sufficient
to make a call on 18 others.
Also likely to receive greater scrutiny from the White House are federal unions, traditionally allied to
Democrats (although keep in mind that unions representing border patrol agents and immigration/customs
agents did endorse Trump). The platform says this: “The unionization of the federal workforce, first permitted by Democrat presidents in the 1960s, should be reviewed by the appropriate congressional committees to examine its effects on the cost, quality, and performance of the civil service. Union representatives in the federal workforce should not be paid to conduct union business on the public’s time.”
That latter reference is to “official time,” which is on-the-clock working time that employees serving as
union officials can spend on certain union duties. Republicans have pushed for years to end that practice,
which unions—and their Democratic allies in Congress—stress was placed in law to make up for the
obligation of unions to represent all bargaining unit employees regardless of whether they pay dues.
Eliminating it thus would require a change in law.
Much easier to reverse would be the Obama administration executive order telling agencies to involve
unions before certain workplace decisions are made, to collaborate more over workplace practices, and to
bargain over areas where negotiations are at management’s discretion. A similar Clinton administration
executive order was quickly overridden by the incoming Bush administration and it’s likely to occur once
again under the incoming Trump administration – although President-elect Trump has often cut against
the grain of Republicans before him.
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