President Obama promised that the brunt of any financial reckoning will fall mostly only on those making more than $250,000 annually. Under his healthcare plan, the economic agony starts at income levels that fall much lower than that.

Alan Krueger, recently named by President Obama to be the new chair of the Council of Economic Advisors, is perhaps best known for his claim that raising minimum wage will not reduce employment. But Krueger has had a long, varied career as a labor economist--and a history that should be especially interesting to budget cutters.

A January 2012 report by the Congressional Budget Office (CBO) shows that federal government employees receive substantially higher compensation than similarly skilled workers in the private sector. The report’s methodology and conclusions are broadly similar to previous studies from both The Heritage Foundation and the American Enterprise Institute.

Although federal workers earn higher wages and benefits than comparable private workers, the state-local situation is more complicated.

The teaching profession is crucial to America's society and economy, but public-school teachers should receive compensation that is neither higher nor lower than market rates.

Several studies have shown that public-sector workers receive higher compensation than their counterparts in the private sector. Although, federal contractors have some of the advantages of private sector workers, in that poor performers can be dismissed and the composition of the contractor workforce altered, it is possible that they are overcompensated just as federal employees are right now.

After adjusting for education and experience, federal workers have higher salaries than private workers in the same fields, and when factoring in their generous benefits packages, total compensation for federal workers could be nearly $14,000 per year more than for similar private workers.

OPM's response to our federal-private pay comparison levels several feeble criticisms on wages, soft-pedals the benefits issue, and ignores all of the problems with its own methodology.