Despite being considered a third rail by many members of Congress, the Pentagon is rolling out proposals to overhaul its military retirement system — including offering cash earlier but lowering the lifetime value for many service members, according to a 44-page document obtained by Military Times.
Some key takeaways from the report:
- The report lays out two concepts for potential reforms, but they would both mean a lower lifetime monetary value for many future service members, compared with the current system.
- Under one proposal, active and reserve members would get “partial benefits” once they retire from the military until they reach their early 60s. Pentagon officials have repeatedly pointed out that many military retirees go on to have second careers before leaving the workforce.
- Under the second proposal, active forces would get full benefits after they retire from the military — but the monetary value would be smaller than what service members get today. And reserve members would have benefits kick in at age 60.
- Both proposals require service members to serve 20 years before they are fully vested in the retirement plans.
- In both concepts outlined, the Pentagon would contribute a certain percentage of annual base pay after two years of service to a 401(k)-like plan. Service members would become vested if they continue serving after six years.
- Both proposals would offer a bonus around the 12-year mark to try to boost retention in mid-career service members. Defense Department officials and members of Congress worry that changing the current military system will hurt the military’s chances of keeping top talent.
- The proposals grandfather in current military members and retirees.
The report stresses that the proposals are only meant to be food for thought for a commission looking at compensation and retirement changes. Rear Adm. John Kirby, the Pentagon press secretary, said the commission asked for the Defense Department to provide options, and the Pentagon doesn’t side with one over the other.
The Military Compensation and Retirement Modernization Commission’s report isn’t expected until February 2015, and top Pentagon officials including acting Deputy Defense Secretary Christine Fox have pledged to hold off on formally recommending any changes until after the commission’s work is complete.
The report is a complex balancing act of trying to reform a system without affecting the military’s ability to retain top talent and recognizing, as Defense officials have said, that something has got to give.
But personnel costs have long been considered sacred ground for Congress, and lawmakers are quickly overturning most of a $6 billion cut to working-age military retiree pensions included in December’s budget agreement. The Pentagon is already facing an uphill battle on a handful of changes it is hoping to make as part of its fiscal 2015 budget request.
What We're Following See More »
When it comes to name-calling among America's upper echelon of politicians, there may be perhaps no greater spat than the one currently going on between Sen. Elizabeth Warren and Donald Trump. While receiving an award Tuesday night, she continued a months-long feud with the presumptive GOP presidential nominee. Calling him a "small, insecure moneygrubber" who probably doesn't know three things about Dodd-Frank, she said he "will NEVER be president of the United States," according to her prepared remarks."We don't know what Trump pays in taxes because he is the first presidential nominee in 40 years to refuse to disclose his tax returns. Maybe he’s just a lousy businessman who doesn’t want you to find out that he’s worth a lot less money than he claims." It follows a long-line of Warren attacks over Twitter, Facebook and in interviews that Trump is a sexist, racist, narcissistic loser. In reply, Trump has called Warren either "goofy" or "the Indian"—referring to her controversial assertion of her Native American heritage.
The House on Tuesday voted 403-12 "to pass an overhaul to the nation’s chemical safety standards for the first time in four decades. The Frank R. Lautenberg Chemical Safety for the 21st Century Act aims to answer years of complaints that the Environmental Protection Agency lacks the necessary authority to oversee and control the thousands of chemicals being produced and sold in the United States. It also significantly clamps down on states’ authorities, in an effort to stop a nationwide patchwork of chemical laws that industry says is difficult to deal with."
Citing the unpredictable nature of this primary season and the possible leverage they could bring at the convention, John Kasich is hanging onto his 161 delegates. "Kasich sent personal letters Monday to Republican officials in the 16 states and the District of Columbia where he won delegates, requesting that they stay bound to him in accordance with party rules."
Bernie Sanders "signed a letter Tuesday morning requesting a full and complete check and recanvass of the election results in Kentucky ... where he trails Hillary Clinton by less than one-half of 1 percent of the vote. The Sanders campaign said it has asked the Kentucky secretary of state to have election officials review electronic voting machines and absentee ballots from last week's primary in each of the state's 120 counties.
Virginia Gov. Terry McAuliffe (D) “is the subject of an ongoing investigation by the FBI and … the Justice Department” for potentially improper contributions to his 2013 campaign, including while he was a Clinton Global Initiative board member. ... Among the McAuliffe donations that drew the interest of the investigators was $120,000 from” former Chinese legislator Wang Wenliang. “U.S. election law prohibits foreign nationals from donating to … elections. … But Wang holds U.S. permanent resident status.”