Federal Retirement: a Modest Proposal

It happens every year: in the not too distant future, once Syria fails to capture the national news cycle, some wag inside the E-Ring will speak with reporters about plans to slash military retiree benefits in order to pay for something so vitally important that breaking faith with America’s most loyal servants is worth it. The American military retiree special interest group and its representatives (American Legion, VFW, DAV) will lobby Congress to borrow more money to continue the status quo, and to target federal workers’ retirements.

 It never happens: no one in the three branches of our government challenges the status quo.

Do retired Military or Civil Servant earn their retirement packages? Of course they do! But, consider this: what can’t be maintained won’t be maintained. Every year, we put more debt on the national credit card, and retirees suffer an erosion of benefits. Federal servants are not alone: state and local civil servants are also guaranteed retirement that is not underpinned by actual cash in the bank. And every year, their retirement is a politcal soccerball to get kicked around for the amusement of the masses.

 The status quo is industrial age. Work 2-3 decades, get a portion of your pay, and have the government underwrite your health and dental care. When most workers passed away relatively soon after retirement, generous packages were sustainable. Now that people are living much longer, multiplied that government has grown into the millions, and that industrial age retirement plan is unsustainable and you the retiree face getting absolutely nothing.

  My proposal for all federal workers:

1 retirement program: military, civil and foreign service, POTUS, members of Congress (after 2o years of service), and the federal judiciary. E Pluribus Payem.

Offer non-cash options: land, house, cars/trucks, childrens’ college education for free. A place to live, a truck to drive, kids through state school cost less than half pay for 50 years. Government has lots of land. Give options.

Offer non-VA, non-Try-to-get-care medical: the VA will maintain you in your decline, it won’t cure you. Is a better quality of life worth not hanging out at the VA?

What say you?

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Comments

  1. Mike_Burke says:

    Some interesting ideas here. In terms of in-kind benefits:We have tried most of them already–retired soldiers (the only retirement was for medical reasons then) could eat free at a nearby fort and get a free uniform once a year–this worked OK if you lived near a fort–after the Revolutionary War, alas, there was just one for awhile–West Point. And soldiers applied for pensions based on their service. The war Department administered them all–that's how we know how many women disguised themselves as men and served during both that war and the Civil War. Medical care came through the Army for retirees until the VA was invented–there were old soldier barracks at more established installations. The education benefit=service academies–we preserve that legacy in presidential and vice-presidential nominations.

  2. Mike_Burke says:

    In terms of land, we gave land grants to soldiers after Revolution and War of 1812 (when we really did have lots of land)–most, alas, were sold to speculators at massive discount because of post-war economic depression. The retirement system we have now is not too far from that envisioned by the guy who invented military retirement for length of service–General Alexander Macomb (Commanding General of the Army 1828-1841who also wrote first manual for courts-martial)–he saw it, as contemporaries do now, as a force management tool to get old guys out so young guys could get promoted and be more effective leaders.
    In-kind is inherently inequitable, alas, but straight dollar amounts are easy to compute and compare. TRICARE, which I helped invent (I am responsible for the enrollment fee), was designed to get past the many inequities in CHAMPUS and to guarantee access to the healthcare system no matter where you lived–this is also a VA problem–geography determines care access–they should just use the TRICARE model and go to all private care–too bad their medical system is actually, in terms of costs and outcomes, among the most cost-effective in the country–like Medicare, interestingly enough, which has extremely low overhead.

  3. Mike_Burke says:

    One final point: the military retirement system, while expensive, works. It provides a pretty fit, young, ready force, keeps people in when they have better options on outside, making them available in wartime when needed and when they would probably just as soon get out, Reformers always forget that most people find military service distasteful, and getting them to stay is tough–easier now when we are coming out of economic chaos, and hard to compare to civilian sector since so many companies have opted for 401Ks, which really were never intended to be general employee pensions–they were designed for executives and meant to be used to keep key guys around–
    I used to be the Army staff go-to guy on military retirement policy questions–I knew I'd been there too long when I could defend 20-year retirement with straight face–but the more I think about it, the more the current system is what has kept our military by and large intact. Not to say it can't be tweaked, but massive reform will remain largely a pipe dream.

  4. buke81 says:

    Since what, less than 20M folks are "Vets" out of the 350+M folks living in america….(I am one of them who happend to go 20+ AD) not sure how much "savings" we will get by reforming DOD health and vet benefits as compared to the rest of the citizenry….but you have some interesting ideas

  5. VMI Warrior says:

    Current retirees should not see any reduction in benefits. To do so would be a breach of contract, contrary to 1000 years if Anglo-Saxon jurisprudence. That being said, a 20 year retirement is unsustainable, and in many ways, undesirable. To pay a 38 year old “retirement” for the rest of his life is rediculous at best. It should be increased to a minimum of 25 years / 50 years old. This would insure more senior, experienced troops stay in.
    As far as medical benefits, I don’t know enough about the details to have an informed opinion.

  6. Mike Burke says:

    We did try a longer period to qualify for retirement, the "redux" system begun in the mid-80s that required 23 years service (more or less) to get to the same benefit as the 20-year system–it was created in response to the retired pay account being whacked in the name of deficit reduction. This system caused massive retention issues in the 90s, when servicememebers saw thy'd been screwed, and GEN Hugh Shelton, CJCS at the time, got Congress to restore the 20-year system.

    At the same time, the services went to the "high-three" average of the three last years of service–that reform alone reduced retired pay outlays by about a third from the amount it would have been otherwise. That's been in effect for well over 20 years. I retired under the "final basic pay" formula, which used my last month's basic pay, my highest (05 over 26). Most people don't realize that a relatively simple change like "high-three" saves massive amounts.

  7. maj w says:

    Thanks for the posts mike – very informative indeed. Any thoughts about why the reserve retirement program is structured as it is? I’m a retired reservist with almost 14 years of active duty due to gwot. 23 years total. I think we’re screwed having to wait till 65 especially in light of all of our extended service and the life/career decisions we’ve made to be available to fight and those decisions’ resulting impact on our careers back in the world. and I am not alone by any means. don’t get me started on medical benefits

    ….

    • maj w says:

      …meant “structured as it is considering the ramifications of the reserve total force posture and resulting long service of all our reservists in gwot”. Get my drift?