FREEZE WATCH: a freeze warning is in effect for the federal bureaucracy. The warning area extends from Washington to Honululu. A low-pressure system, fed by gale-force political/economic winds, is building at the White House. Forecasters say a hard freeze could block all government hiring, and chill future payments under Social Security and federal-military retirement program. Details below:
Fresh from a real winter storm, Washington is now bracing for some tough economic news, including a possible federal hiring freeze.Rumor has it the president will impose the freeze as part of a major anti-inflation, budget-cutting package due within the next 10 days.
Many key federal officials believe a freeze is in the works. And many agencies have been working overtime sending out "commitment" letters to people they want hired before any such freeze arrives. Agency officials yesterday delivered option packages to the Office of Management and Budget, detailing cuts they could make. Some include job cuts, and a number recommended limited hiring freezes.
Insiders say a hiring freeze (but not a freeze on promotions) is likely. Nearly half the personnel directors contacted by this column yesterday said freeze rumors had triggered units under them to step up hiring. Idea is to beat any cutoff and beef up staffs depleted by an unusually large number of February retirements.
Agency budget officers predict the White House, as part of a broad-ranging economic belt-tightening edict coming, will direct specific dollar cuts. But they do not agree on the need for a government-wide hiring freeze. Their idea is that the White House could, and should, leave it up to agencies to handle dollar and program cutbacks as they see fit, some by selective freezes.
But political types think a government-wide freeze is attractive, as part of the White House plan to send the nation a message that Carter is doing something decisive to trim inflation, now running at an annual rate of about 18 percent.
Two options being considered by the White House probably will not see the light of day this election year. But they will come back:
1) A change in the Consumer Price Index to deemphasize costs associated with purchasing new housing. The CPI is used to figure annual COST-OF-LIVING (COL) raises for people under Social Security, and to grant COL raises every six months to federal and military retirees.
2) another option is for the administration to propose eliminating one of the two COL raises federal-military retirees get each year. Retirees now get boosts in March and September. Idea is to put them under the same one-raise-a-year system as Social Security. Both options would require congressional approval, and that isn't in the cards in a political year. But they will be back next year.
Some kind of federal hiring freeze is a good bet. Many agencies have begun hiring as if there were no tomorrow which will indeed be true if the freeze rumors become fact.
Insiders say a freeze is one of the best economic tools Carter has. Few people in this country are crazy about "big government" -- unless it denies them something. And a freeze is something a president can do, without fiddle-faddle from Congress.
Finally, a freeze could serve to damage the prospects of two of the nation's most persistent job-hunters. They are Ronald Reagan, who has been blasting bloated bureaucracy, and Edward Kennedy, who hates inflation. Carter could put the freeze on government and, if the government approves, burn the employment prospects of two of his biggest nonfans.