Federal pension grab in new budget


Leave it to David Dayen to dig out the nasty details of the Ryan-Murray budget deal and how federal workers will be sacrificed to the deficit gods:

2013 has not been a pleasant year if you work for the federal government. You’ve been subject to pay freezes, furloughs and shutdowns. One of you got yelled at by a Tea Party Republican at the World War II memorial. And if Congress passes the budget deal announced Tuesday night by Rep. Paul Ryan and Sen. Patty Murray – a big if – you will get a final Christmas present: You’ll have to pay more into your pension, an effective wage cut that just adds to the $114 billion, with a “B,” federal employees have already given back to the government in the name of deficit reduction.

The deal between House and Senate negotiators Ryan and Murray would reverse part of sequestration for 2014 and 2015, itself a major source of pain for federal workers. But negotiators want to pay for that relief in future years, with the overall package cutting the deficit by an additional $23 billion. And one of the major “pay-fors” is an increase in federal employee pension contributions. President Obama’s 2014 budget included such a proposal, which would have raised the employee contribution in three stages, from 0.8 percent of salary to 2 percent. Congress had already made this shift for new hires; the Obama proposal would affect all workers hired before 2012.

That proposed increased contribution translated to a 1.2 percent pay cut, and a total of around $20 billion in givebacks over 10 years. Negotiators were pressured by the powerful Maryland Democratic delegation, including Minority Leader Steny Hoyer, House Budget Committee ranking member Chris Van Hollen and Senate Appropriations Committee chairwoman Barbara Mikulski, into softening the blow on federal employees, many of whom live in their districts. According to Sen. Murray, the increase in contributions now equals about $6 billion over 10 years. But negotiators traded some of the cuts to federal employee pensions with different cuts to military pensions, also totaling $6 billion. So whatever the occupation, people who work for the government will bear the brunt of the pain.

Read it and weep. Once again, the deficit madness gets pushed to a different segment of the population so the rich may rest in luxury.

5 thoughts on “Federal pension grab in new budget

  1. Federal employees like military personnel are well compensated for their service. Let’s talk about the very generous compensation our tax dollars afford military personnel though. But first one question; why do we have 35 generals and admirals currently on active duty? More than at any time in our 220 year history including during WW2. As for military compensation, 64% of the tax dollars alloted for service members pay and benifits is deferred for 10 or 20 years or more. To name two: Tricare and pensions (both unfunded liabilities). To claim that military personnel are not well compensated for their service is inaccurate. The problem is that our politicians have chosen to defer compensation into the future in the form of unfunded liabilities rather than fatten current service members paychecks. We can all probably guess why? Maybe our grandchildren will streighten out this corrupt system?

  2. Actually, the 1.3% levy will be on NEW hires. Not on existing Federal Employees. However, there are no COLA or Annual Pay increases in the proposed budget, which means we’ll be on our 4th straight year of pay freeze. That adds up to a BIG loss over that time.

  3. Let’s consider wage comparison between Federal employees and those in the private sector.

    Such comparison depends in large part on degree of education attained by the employee. As can be seen from this 2012 Congressional Budget Office study –


    – a federal employee with high school or “some college” education receives wages that are definitely more generous than a private sector employee with the same amount of education.

    – when you compare wages for those holding a Bachelor’s degree, the wages of a federal employee and private sector employee are nearly dead even.

    – For those holding a Master’s degree, wages in the private sector are definitely more generous than within the federal government

    – And for those holding the Ph.D, or who would be described as “Professionals” – the private sector is far more generous in terms of wages.

    Regarding the phrase “…and how federal workers will be sacrificed to the deficit gods…” – federal workers already HAVE been sacrificed to the deficit gods ever since Obama took office. They will be sacrificed even more now.

    Once upon a time in the ancient Middle East, priests of the god Moloch assured one and all that children had to be sacrificed to keep the sun shining, and therefore the crops growing. Nowadays, priests of the Ever Growing Corporate Capitalist Economy assure us that sacrifices are required by little people everywhere to make sure the Ever Growing Economy keeps on Ever Growing.

    The logic now makes as much sense as it did back then.

  4. DC-HQ says we all must sacrifice in these times of austerity . . . Well all that is except those that have all the money. It seems very clear which part of the electorate ‘our representatives’ take their orders from. I’m beginning to look very favorably on the aftermath of the French Revolution . . .

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