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Speaker Gingrich’s Claim of $500 Billion in Civil Service Savings Doesn’t Add Up

In last night’s presidential candidate debate, former House Speaker Newt Gingrich said, “if we were prepared to repeal the 130-year-old civil service laws and go to a modern management system, we could save a minimum of $500 billion a year with a better system.”

That’s incorrect.  Here’s why.

Total federal personnel costs in fiscal year 2011 — including indirect costs, like health benefits — were $432 billion, according to the Office of Management and Budget (see Table 11-4 here).  That figure includes the armed forces, which aren’t bound by the civil service laws, and the postal service, which was privatized back in 1989 and is no longer bound by most aspects of the civil service laws.  Subtracting those two groups of workers gives you $247 billion in total compensation for federal civil servants.

Putting this differently, even if we fired all Defense Department personnel who are not in uniform and all Veterans Administration personnel — and that’s half the civil service right there — along with FBI and DEA agents, air traffic controllers, food and mine inspectors, park and forest rangers, procurement specialists, Justice Department prosecutors, Social Security clerks, federal judges, passport officers, patent and copyright agents, and so on, and didn’t replace any of them, we would get only halfway to Gingrich’s $500 billion goal.