While the recent Hay study had a lot of problems, it did have a major impact on the lives of Guam’s families and our economy. After 20+years of Stagflation the lowest paid public workers finally got an adjustment only to have it taken away almost instantly because “There is no money”. There is a common misconception that has been perpetuated by Guam’s media that this pay adjustment would cost our Public coffers $13M, but this isn’t true. Right off the bat approximately 30% of this money is withheld for taxes reducing the net outlay to only $9.1M. Next, since the bulk of the raises go to the lowest paid public employees, a large percentage will be raised above the poverty level that qualifies them for the Earned Income Tax Credit. This would save the General fund millions of dollars. Lastly, there is the velocity of money. Economists tell us that every extra dollar paid to workers circulates in our economy ten times, which would generate millions of additional revenue for the General fund in the form of Gross Receipts Tax, Corporate Income tax and personal income tax as a result of the additional $9.1M pumping into our local economy.

Raising the wages of Public Employees benefits everyone on Guam not just the families that would receive it. How many parents will be able to send their children to take music lessons, buy them sports equipment or take them to the movies? How many people would have used this additional income to buy a new car, move into an apartment or get cable TV? We are not talking about $100k per year bosses; this pay adjustment affects $8 and $9 per hour workers. The freezing of the implementation of the Hay plan is the wrong move for all of Guam’s Working Families and we implore the Governor to think of another way to balance the budget. We can’t continue to take money out of the pockets of the working class and expect our economy to grow it just doesn’t make sense.

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