President Reagan's proposal to cut federal workers' pay by 5 percent in 1986 -- the first such cut proposed since the Great Depression -- drew howls of outrage and surprise yesterday from federal employes here, and predictions of defeat from Washington-area congressmen.
But Donald J. Devine, director of the Office of Personnel Management, said he believes a "changing mood" in Congress will shift support in favor of the cuts, which he said would save an estimated $13 billion over three years. Additional savings are expected, he said, through cuts in retirement benefits that will also be included in the Reagan plan.
"The whole world has changed because of a little thing called an election, in which the president got a mandate to reduce the size of government and bring expenses under control" to reduce the federal deficit, Devine said.
Federal employe union officials said they would mount a strong lobbying effort to defeat the Reagan plan, and Washington-area congressmen, Democrat and Republican, immediately denounced the cut. Several union officials also said they believe Reagan's actual goal is a federal pay freeze, and they see the surprise pay-cut plan as a "bargaining chip" or a "scare tactic" he will later abandon to win a freeze.
Virginia and Maryland congressmen described the proposal as drastic and devastating to what they said was the already-slumping morale of the region's 350,000 federal workers. Federal workers will receive 3.5 percent raises in January, which will be partially offset by increases in health insurance costs, but would receive cuts starting in October 1985 that would average $1,250 per worker, officials said. Median pay of federal workers in the Washington area is $27,252, according to OPM.
"Reducing the deficit requires us to make hard choices," said Rep. Michael Barnes (D-Md.), who chairs a congressional caucus on federal employe issues, "but there is a difference between making unpopular statesmanlike decisions, and decisions that are patently absurd."
"Does the president really want to tell the Secret Service agents to whom he owes his life that their reward in this nonrecession economy is a 5 percent cut in pay?" Barnes asked. "Does he want to tell NASA's space shuttle scientists, the doctors at the National Institutes of Health working to find a cure for cancer, and our diplomats who are under attack in Central America and the Middle East that they should take a 5 percent cut in their pay?"
OPM's assistant director, Mark Tapscott, noting that Election Day exit polls showed Reagan with a slight edge among federal employes, said, "We have said all along that the majority of federal employes appreciate that we face a serious situation. They are patriotic Americans and they support the president."
When it comes to pay cuts, however, a sampling of reaction among federal workers here showed overwhelming opposition.
"How are we supposed to live on less money, when the cost of everything else is going up? And why does Reagan keep attacking federal workers?" said Nan Burke, a GS-4 technician who said she earns $15,739 after 10 years at the Veterans' Administration Hospital.
"He talks about tightening our belts? Well, my belt is so tight now my stomach presses my backbone. How tight does he want me to tighten?" said Burke. "I am a single parent, raising a daughter, and I can't even afford to send her to her prom. She is 15, and I can't make ends meet anymore."
Kenneth T. Blaylock, president of the American Federation of Government Employees predicted that pay cuts or a freeze would prompt a growing number of workers to quit government service. He said, "A hell of a lot of people are leaving government as fast as they can.
"Federal employes have been made scapegoats for the last decade," said James Peirce, president of the National Federation of Federal Employees, who noted that since 1977 federal workers have received less in wage increases than the amounts recommended under the 1970 "comparability" law that mandates an effort to bring federal pay into line with private-sector jobs.
Devine, however, disputed the union contentions, saying that the federal "quit rate" averages about 6 percent a year, or roughly half that of the private sector. "If our compensation is so bad, why do people keep staying?" he asked. Union officials said they believe the quit rate is closer to 10 percent, but did not have specific figures.
The President's Advisory Committee on Federal Pay estimated that 1984 pay lagged an average of 18.5 percent behind the private sector, and a recent study released by the House Post Office and Civil Service Committee said federal employes trail 7.2 percent behind private-sector counterparts, according to Rep. Steny H. Hoyer (D-Md.), who predicted the pay cut "will be dead on arrival on Capitol Hill if it is not revamped."
"It appears that Charles Dickens' 'A Christmas Carol' is coming to life this year. Not only is Scrooge asking the already underpaid Bob Cratchett to work on Christmas Eve, he is also telling him that his pay is being cut," Hoyer said.
Virginia Republican Reps. Stan Parris and Frank R. Wolf, in a joint letter to Reagan, urged him to scrap the plan. "Nothing is more corrosive to good morale than the perception of a continual erosion of benefits," they said. "Nothing is more corrosive to good government than the continual loss of quality personnel because their employer reneged on its commitment to a benefits and pay structure that is fair and sound."