Opinion: Daily Journal

The Gotcha Moment That Wasn’t

“We would often be sorry if our wishes were gratified.” So said the Greek storyteller Aesop more than 2,500 years ago.

That quotation and a related notion, “be careful what you wish for,” came to mind recently when opinion editors of the state’s largest newspapers reacted to comments published in one of their news articles.

The story developed from a 2014 state budget provision that allowed Treasurer Janet Cowell to spend $1.2 million on pay raises for 25 “key” investment employees. As reported in the Raleigh News and Observer and Charlotte Observer, those raises — ranging from $13,750 to $87,872 — were based on legislative authorization to “establish market-oriented compensation plans” for employees with specialized skills or knowledge.

Before writing the article, reporter David Ranii asked the John Locke Foundation for reaction to the raises. “When there is a market for a certain type of employee, it probably makes sense for a government to use market-based pay,” I said during the course of a short interview. Ranii also quoted me in the story as saying that the elimination of standard government job security for employees receiving market-based raises represented a good trade-off.

There’s no dispute about the quotations. Ranii got them right.

Left on the cutting-room floor and out of the story was another point of emphasis: Because other employees in the Office of State Treasurer would continue to be paid based on more traditional government pay schedules, it would be important for Cowell’s team to have specific metrics to justify the pay raises.

Taxpayers would be ill-served, and fellow state employees would be more likely to grumble, if the raises appeared to be based on patronage or some other form of political favoritism rather than objective measures of the employees’ job performance.

The day after Ranii’s story appeared, his editorial page responded. Citing my quote about “market-based pay,” the unnamed editorial writer opined:

“It seems some public employees are created more equal than others. Namely, high-ranking executive types, especially those who handle large amounts of money or work closely with lawmakers.

“For those folks, N.C. conservatives always seem ready to justify pay raises by citing the market; we must pay the market rate for top talent.”

The editorial goes on to lambast lawmakers and Gov. Pat McCrory for failing to apply the same logic to public school teachers. Downplaying large-scale pay hikes approved in recent years, especially double-digit percentage increases for early-career teachers, the writer’s disdain focused primarily on a “measly” $750 bonus for experienced teachers in the most recent state budget.

Left unstated in the editorial itself, but spelled out directly in the headline that appeared on the websites of both the Charlotte and Raleigh newspapers: “Time to pay North Carolina’s teachers the market rate.”

One suspects that the editorial writer considered this a “gotcha” moment: Those hypocritical conservatives rely on the word “market” only when it suits them. When the time comes to apply market-based principles to teachers, those same conservatives remain silent.

There are multiple ways to respond to the editorial’s flawed analysis. One involves a rebuttal of the notion that recent actions from the governor and General Assembly have no basis in application of market principles to teacher pay. I’ll leave that response to others. The state’s outgoing budget director, Lee Roberts, and the governor’s education adviser, Catherine Truitt, addressed that issue in a published response to the newspapers.

More interesting to this observer was the fact that the December 16 editorial headline closely resembled this one: “Pay Teachers a Market Wage.” That headline accompanied a July 17 column at CarolinaJournal.com from Terry Stoops, the John Locke Foundation’s top public education expert.

Yes, five months before a newspaper editorial writer accused North Carolina “conservatives” of ignoring the notion of applying market principles to teacher pay, a “conservative” N.C. publication called for the application of market principles to teacher pay.

Here’s where Aesop’s admonition comes in handy. The editorial writer seems to believe that an application of market principles to teacher pay would lead to a large across-the-board pay increase for North Carolina’s teachers. “The market certainly says teachers should have a more substantial raise,” the editorial suggests. “We’ve fallen to 47th in teacher pay, and teacher turnover is rising.”

Yet the writer betrays an unfortunate ignorance of markets. Let’s set aside for now two glaring problems associated with that quote: reliance on misleading average teacher pay rankings and a misreading of the state’s teacher turnover reports. Instead, let’s examine how market principles would apply to teacher pay.

Teachers would not see base pay and pay raises based almost exclusively on years of experience. Instead, factors such as the teacher’s subject area, training, and willingness to work in hard-to-staff schools all would influence her salary. In addition, pay based on market principles would incorporate some measurement of the teacher’s classroom effectiveness.

A pay system based on markets could allow those with special skills, effective training, proven results, and the desire to work in the toughest circumstances to earn much higher pay than those lacking those attributes. A pay system based on markets would help school systems compete more effectively with private- and other public-sector employers in attracting and keeping top talent.

A pay system based on markets would fly in the face of most proposals put forward by teachers unions and the state’s education establishment. Those groups tend to promote policies that “ensure uniform pay regardless of teachers’ aptitude or training,” as Stoops pointed out five months before the newspaper editorial’s publication.

While one might hope that the editorial board of the state’s largest newspapers would welcome benefits that would flow from market-based teacher pay, this observer is more inclined to believe that the authors of the recent editorial would be sorry if their wishes were gratified.

Mitch Kokai is senior political analyst for the John Locke Foundation.