Posted on 12/12/2013 11:24:42 AM PST by Sleeping Freeper
Edited on 12/12/2013 11:27:38 AM PST by Admin Moderator. [history]
Military retirees are outraged that Congress will start voting Thursday on a budget deal that trims military pensions, calling the move "an egregious breach of faith."
The Military Coalition, some 27 military groups, wrote to leaders in Congress and President Obama late Wednesday about their "strong objection" and "grave concern" over the budget deal.
(Excerpt) Read more at money.cnn.com ...
This is outrageous, but how many people who are rightfully incensed over cutting military pensions are indifferent, or pleased, at the prospect of Detroit retirees losing their pensions? The spirit of austerity is like a prairie fire, once it erupts it’s hard to control, and nobody can tell who will wind up being burned.
I don’t want to see anyone’s pension benefits decimated. Of course, the military is a special case, but we also need to be concerned about Social Security, Medicare, 401ks, and private and public pensions. We also need to be concerned about the fate of future generations and the sustainability of retirement systems. These need to be addressed in a spirit of fairness and a desire to advance the common good. It’s depressing to see the young set against the old, the public against the private, and the civilian against the military. We’re all in this together, and there shouldn’t be any second class citizens.
Well said and I applaud your thinking (and agree). However, people are so stuck on what they were promised that there is little thought of shared sacrifice.
This bill is outrageous in that it seemingly singles out military retirees for cuts. This bill is also outrageous because we are trillions in debt and it only cuts 23 billion and spreads that out over 10 years. I believe it’s less than a half of a percent in overall government expenditures. What a joke. We are destroying our future to keep the Ponzi scheme alive. We are enslaving our children and grandchildren to preserve the status quo and keep politicians and special interests happy.
Just watch a social security thread here on FR and it will prove what you said. Our leaders won’t tell us the truth because it’s ugly. We need huge cuts across government to survive and it won’t happen with this bunch. They will beat their chest and talk about meaningless cuts spread out over 10 years.
Wake me when they cut the entitlements. Based on my calculations, they could cut out all non-entitlement spending and we would still go bankrupt or experience hyperinflation.
Military pensions are funded in advance. That started in 1984. All of my retirement pay was paid in advance during my time in service.
“To promote better management, in 1984, Congress directed a switch to an accrual method of funding retirement. Under this procedure, each year the services transfer into a fund the amount necessary to pay for future retirements.”
http://www.rand.org/pubs/research_briefs/RB3005/index1.html
By cutting the COLA, they save money both by needing to fund less now for future retirements, and by taking back money already pain into the trust fund. What Congress and the GOP are doing is the same as taking money out of someone’s IRA...
This isn’t just about a promise not kept. I assumed everyone here on FR understood the importance of our military and their service.
I used the word “promise” in the true sense of the word. A promise to the brave who choose to don a uniform and vow to protect our Nation.
Again I say... cut every other program, including the disability fakers and welfare queens, and birth control and abortion sluts,.....then we can talk about cutting money off the backs of our heroes.
1.If a COLA is, let’s say, 2% of base pay then 1% of that is chump change.
2.The example given was $3700 a year. Again; if the COLA was 2% that means base pay was $185,000
3.It appears you don’t understand the difference between a percent and a percentage point either.
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Sorry my friend, you’re having a mental block on this and not understanding it. The below quoted text is extracted from the article:
“...The average cut in pension payouts, INCLUDING COMPOUNDING INTEREST, for a retiring Army Sergeant first class, would be about $3,700 each year, according to the Military Officers Association of America. Over 20 years, the total losses could balloon to more than $80,000....”
I capitalized three words which mean that, in the article’s example, the $3,700 is the amount that this change in the law will have reduced the retired sergeant’s ANNUAL pension after a period of years compared to what it would have been in the absence of Ryan’s “Screw Military Retirees Act”.
$3,700 a year may be “chump change” to you, but to many of us it is not.
“Military pensions are funded in advance.”
No they are not. They use the same accounting as social security, namely (from your link) “The money in the fund is invested in nonnegotiable government securities”
In other words, the money is simply recycled within the government and spent.
That means that military pension payouts are funded out of current year funds - that also means that when there isn’t enough money in any current year to come, they won’t be paid as expected, if at all. As in Social Security, there is no “lock box”
So, yes, they promised. A government promise is meaningless unless there is a prosperous private sector to pay for it all.
“I used the word “promise” in the true sense of the word.”
And a government “promise” is worthless, in the truest sense of that word.
We already do not have the money to pay for all the government “promises”. All such promises will either be cut, or if not that, they’ll be wiped out altogether.
You mistake my statement of reality as some sort of attack on you or your husband. It is not. It is just the truth.
No, the militarizing FEMA and DHS are.
You do know there exists a statutory provision for NO negative COLA, for anyone, including the military, right?
There have been several years when COLA was 0.
There were a few years it was as high 10-14%.
If you did not retire at exactly 20 years, you worked each year thereafter, needlessly, for 50% of the income you were already fully entitled to receive.
Before you castigate me for my differing views of this “outrage”, you should know I am a USAF veteran, with two honorable DD214s.(I had a break in service, and volunteered for a total of two 4 year enlistments)
That said, if you are as smart as you think you are, you already knew Uncle Sugar was going to break up with you as soon as possible.
Pity the poor civilians who are still working now, and seeing negative results in their actual working wage incomes,(No COLAs for us) and still they(we) are forced to keep paying for Uncle Sugars schemes.
I'm older, and now qualify for the over 55 senior discount rates.
As a member of the “baby boomer” generation, albeit the tail end...I can tell you the reckoning is coming, on schedule.
And you complain about a 1% reduction in an unearned and a never guaranteed annual retirement pay raise formula?Are you sure you are a conservative?
I’m much in agreement with your thoughtful post, except for the presently politically correct “a desire to advance the common good.” Who determines what the “common good” is? And at whose expense?
There is no “common good.” There is only individual good.
Assuming retiring at 40, 1% each year until 62 means a military retirement check will be worth approximately 22% less. Even this, I could accept if it was part of a massive reduction, but it is not. Effectively, other than the pension cuts, we are continuing down the same road of deficit spending that will bankrupt our nation.
Based on your own calculations, that would make your retirement pay at age 62, 72% of your former active duty pay.
Obviously a government math calculation issue.
Any cut in increases is considered a reduction.
That's never true, but that never seems to matter to government mathematicians.
there is a condition called dysphonia...probably not spelling it right...but its basically dystonia of the voice box.....dystonia is a nerve disorder that causes spasms...if you have that, you can get botox for it...of course its a specialized type of treatment and not just any neurologist can do it...
Sounds fairly reasonable to me. They are also talking about making similar cuts to social security. Sacrifices have to be made.
You are wrong.
We do have the money to pay the promises made to our military retirees.
The govt. would rather spend it on junkies, communists, sluts and bums.
That is a fact.
“You are wrong.”
The numbers - deficits, debt don’t agree with you.
Overall employment trend numbers, forecasts for future business performance don’t agree with you.
Trends in government - programs, entitlements, and the appetite for more of the voters don’t agree with you.
We still have money coming in - but the likelihood that it will be set aside for the military is not very high - and the impact of debt and deficits does not spell “solvent”.
The government wastes a lot money, so does the military - that is a travesty, given the state of finances of the people who pay for it all - but it is, for now, a fact of life.
What is correct is that the government has wagered that it can cut military benefits now as a political tool so that the illusion of solvency and the illusion of austerity is communicated and reinforced to the American people. It doesn’t change the truth though, We are broke, we don’t have the money to pay everyone everything someone in government “promised” them.
You just can’t see that the article is in error which is what prompted me to post in the first place. Colas usually run in the 1%-3% range. Reducing 3% by 1% results in a COLA of 2.97%. Reducing a 3% COLA by one percentage point results in a COLA of 2%....See the difference? Now do you understand that a one percent reduction in the COLA is in fact chump change.
Compounding interest can really add up over a long period of time. The article, however, uses a period of one single year. Annual refers to one year. It does not mean “over a period of years”.
You do the math...Tell me how much an SFC would have to earn if a 2% COLA resulted in $3700 in a single year.
The article includes compounding interest in a 20 year total of over $80,000.
Again. This article is just factually incorrect. No one can tell for sure how extensive the damage to retirees will be based solely on the information provided here.
The money has to go somewhere. If non-negotiable bonds are not ‘safe’, then what is? But the money was not just promised. It was spent, and taken out of the taxes paid each year in advance - just as social security was.
That makes it a contract. Yes, a contract is sort of a promise, but it is a promise that has been paid for and thus the obligation is different than the pension in Detroit, which was promised but never funded.
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