The Metropolitan Transport Authority Loses Six Billion Dollars a Year and Nobody Cares

The cliché goes that we get the government we deserve — and to a large degree that’s true — especially when you factor in the conservative failure in the information war. A huge part of that failure is the failure to inspire more action on the part of abused taxpayers.

Here is Johnny Knocke writing at the Foundation for Economic Education about just one more example of governmental corruption — this time in New York City:

New York City is the center of capitalism and financial markets. However, hiding underneath the towering skyscrapers is an organization that defies the free market forces by siphoning off increasing amounts of city and state taxpayer dollars. This organization is the Metropolitan Transport Authority (MTA), which loses on average more than $6 billion per year, dating back to 2009. If the MTA were a company in a functioning free market, it would have filed bankruptcy and restructured a decade ago. Instead, the city and state increase taxpayer subsidies and debt year after year while acquiescing to union demands, resulting in one of the highest-costing, least productive transit systems in the world.

When Cost of Labor Is Greater Than Total Revenue

The average salary of an MTA employee is nearly $90,000.

Salaries, benefits, and retirement at the MTA are out of control. In 2015, the MTA spent $9.85b on employee salaries, retirement, and post-employment benefits. This is one billion dollars more than the $8.4b in total revenue the MTA collected. Before paying any other business expenses, the MTA is already losing money.

An analysis of MTA salary data on, excluding salaries below the lowest contractual union wage, shows that out of 62,507 MTA employees, the average 2015 salary was $89,779. The vast majority of these employees are bus operators, train conductors, station agents, maintenance personnel, and cleaners. Analysis conducted on 2010 salaries of bus/rail operators and maintenance personnel shows that MTA salaries range from 18% to 60% higher than other US metro systems (i.e. Chicago, SF, LA, Miami) with very few exceptions.

The MTA spent over $876m on overtime in 2015

Because the MTA Bus Company did not provide its overtime accounting, total overtime in 2015 is actually greater than $876m. This number is even more egregious when you consider that only a subset of roles is responsible for the vast majority of overtime due to union constraints and inflexible work rules that will be detailed in a later section. Exhibit 1 below shows that in 2015, there were three hourly employees who worked so much overtime they grossed a higher salary than the MTA Chairman, Thomas Prendergast.

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Image credit: Felix Lipov /