| 23 March 2006 Pay for Performance Money makes the world go around. It was true in Cabaret and it is true in Washington. Money is the most interesting change I've ever seen, going from bureaucrat to capitalist. Of course there is more of it, which is quite a novelty. But what's more, out here the amount you make is a secret. In the Service, the pay tables public information. They were published in the military rags they sell at the check-out lines at the commissary and the PX. We all knew what raises we were going to get, as soon as the Congress figured out what to do with the President's recommendation. Discussions about our compensation were normally terse, and to the point. 2.4%? 3.1%? That isn't a raise, it's a joke. When are we going to catch up? Switching hats to capitalism made me a free-market capitalist for the first time, and it made me a bit giddy. At my first civilian job, my mentor “accidentally” let me see his pay-stub, and I blushed when I discovered I had a better deal than he did. What was he thinking? It was some sort of a signal, perhaps a jolt of reality, since he had been with the firm for several years, and I was the new guy. Curious what this market thing does. “Pay for Performance.” Bring in business and the check gets bigger. Everyone dreams of the day when the pension checks start to arrive, and the private sector's river of cash begins to flow. Some hit the big time, hired at dizzying levels based on their previous lives and talents in the government. Most are disappointed. The military folks discover that once the tax-free benefits like housing and allowances for food are stripped off, the pension barely covers the new tax liability. And there is the uncertainty factor, since the agility of business lies in the capacity to shed employees. Everyone craves stability and security. The Government has both, in such measure that it is literally a captive to the system. In the years between the end of the Cold War and 9-11, it literally hired no one. The result has got them in a pickle, with a whole segment of the senior workforce retiring and turning into contractors. How does it then attract the sort of people they need for complex adventures overseas? Particularly when industry is hiring the best away. The Post started to dig into the problem this week, and it is a hard one. Last year, the President's Commission on Weapons of Mass Destruction called on Director of National Intelligence Negroponte to create a more uniform pay and personnel system to create a more agile workforce. To do that, the Ambassador just appointed a human resources director to jam all sixteen component agencies into a common pay system. This is happening elsewhere in the government, notably in the Department of Defense, so it is worth a brief discussion, since the Post apparently does not grasp how complex and contentious the issue is likely to be. First, the basics. The bulk of the Intelligence Community- the IC- is resident in Defense Agencies, where they were hidden in the Cold War to minimize their visibility. The three-letter players are by far the largest employers- NSA, DIA and NGA. Each has a large force of active duty military “on detail.” They are paid by the Military Departments, and their paychecks are addressed by the Defense Advisory Committee on Military Compensation. The Director of National Intelligence does not have much influence over them, since they will continue to be "provided, equipped and trained" by the military departments under US Code Title 10. A large percentage of civilian workers in the IC are likewise employed by the Services or the three letter Combat Support Agencies. Outside agencies, not owing fealty to Secretary Rumsfeld, are under wildly disparate pay systems. That makes it difficult to reassign and recruit employees from CIA, State and Justice to do things that need to be done in the new structure. Complicating the issue are incentives and bonuses offered by some parts of the community for low-density, high-value skills in operations and languages. It is complex. A memorable example occurred with the establishment of what was then known as the National Imagery and Mapping Agency. As part of the merger, the secretive National Photographic Interpretation Center (NPIC) was slated for re-subordination. NPIC was staffed jointly by CIA and DoD personnel. The CIA employees were informed they were transferring from the Langley pay system to DoD in the transfer. There was near rioting in the workforce. Many of whom had unique skills, and could not be permitted to leave. The compromise that stopped the riot was letting them retain their status as Agency employees, though it continued to cause animosity in the other workers who were not so lucky. Eventually, the issue was resolved through attrition and retirement, though rancor remains even now. Over at the Department of Homeland Security, which likewise is a member of the IC, management has been trying to deal with the twenty-odd separate pay systems that came with its creation. Janet Hale was the official charged with bringing them all together, and she is quitting in May after three years on the job. She had 180,000 recalcitrant employees, and the job is not done yet. The personnel reform confronting Ambassador Negroponte is daunting, and is called the “most ambitious scheme the Government has taken on in decades.” That is a code phrase for toxic waste. The optimistic officials taking on the challenge say there are no deadlines for the overhaul, and nothing is on the table in terms of concrete proposals. Previous attempts to adopt new pay systems have failed. A CIA initiative was put on hold in 2001, a victim of worker dissatisfaction. If it sounds like the Agency folks have a pretty good deal, you would be right. The NIMA experience with consolidating pay systems resulted in a stalemate that was rectified only by the passage of time. Grandfathering existing employees to their old systems while instituting reforms for new hires may be the unsatisfactory still years away. Of course, there is an alternative. They could just start over, and out-source the whole enterprise. They could leave it to industry, make it a pay-for-performance thing. Out here nothing is certain, and everything is up for grabs. Copyright 2006 Vic Socotra |