A Pay Cut? Really?

Ed O'Keefe notes today that President Obama has encouraged Spain to adopt an austerity budget that includes a 5 percent pay cut for its government employees. Then he goes on to ask, "could Obama request a federal civilian pay cut here if things got worse?"

The answer, of course is yes, he could. As O'Keefe notes, the 1990 Federal Employees Pay Comparability Act has a giant-sized loophole enabling the president to invoke economic conditions to justify any raise he chooses. (In fact, every year since the law was passed, the country apparently has faced a serious economic crisis -- even during the late '90s, even when the economy was roaring.)

The question is whether Obama would take such a step. In reality, even freezing federal pay would be a pretty dramatic move, given the history of automatic, if sometimes small, salary boosts for federal workers. (And given that Congress is already ignoring the call of Obama and Defense Secretary Robert Gates to hold the line on military pay increases.)

A pay cut is hard to imagine. Then again, we're basically in uncharted territory in terms of the amount of debt the government has taken on. Who knows what might happen?