Friday, January 3, 2014

Military veteran pension cuts trigger backlash


One provision in the bipartisan budget deal signed by President Obama last Thursday has received considerable backlash: cuts to military veteran pensions. The cut is a "one-percentage-point reduction in the annual cost-of-living increase" which is a relatively modest, and is estimated to save $6 billion in 10 years. A considerable chunk of the defense budget is allocated for pension and compensation, and Paul Ryan, one of authors of the budget deal, has insisted that this is a "reasonable adjustment" to a defense budget that may soon become unstable. Critics concede that reform is necessary, but any changes should be applied to future enlistees only. 

Due to the considerable backlash, new ideas have been proposed replacing military pension cuts, one of them being ending Saturday mail. This proposal would end Saturday mail delivery by the United States Postal Service, and is expected to save $17 billion over 10 years, more saved than that of the military pension cuts. However, this proposal will definitely spark anger throughout postal service groups, and there is no perfect solution to please everyone. I believe the veteran's outrage has another layer than just money. Of course, money would play a huge role in their anger, especially when some in the military have planned their future with the promised pension in mind, but I think to veterans these cuts look like the United States dismissing an important promise. 

It seems that someone's budget/service is going to be slashed, but the question is who and by how much, so what do you think is the most sensible and simple plan for these budget cuts? Are veterans and critics of the provision in the budget deal overreacting to a small cut, or they rightfully angry at what seems to be a breaking of a significant promise? Judging from the backlash and range of ideas to replace the military pension cut, I think this provision will at least be modified in the near future.

3 comments:

Anonymous said...

I think this is a pretty clear situation. The US Postal Service(USPS) has long had financial troubles. Last September it defaulted on its own debt caused primarily by retiree health benefit expenses. The root of the problem, however, lies in that the demand for sending mail has decreased as more and more people turn to electronic forms of communication. Unfortunately, as Josh Hicks points out on an post in The Foundry, the conservative blog of The Heritage Network, "Plans to save money by reducing Saturday deliveries and reducing the number of post offices have been blocked on Capitol Hill. " Honestly, this proposal introduced by Rep. Darrell Issa to end Saturday mail is something that should have been passed a long time ago.

For James Gattuso's post: http://blog.heritage.org/2013/10/01/postal-service-wont-shut-down-but-will-default-on-its-debt/

Anonymous said...

I think it's interesting that these are the two options brought up in this post. I feel as though there are a lot of places wherein the US government could reduce spending. When it comes to our gigantic military budget, I'm sure we could find other ways to shrink it (and still have it remain large) without affecting pensions. But, of course, there will be people opposing any resolution.

In terms of the mail, it does make sense to stop postage on Saturdays. Every year that goes by, the public becomes more reliant on electronic mail and forms of communication. It would definitely be a shame though, as post offices seem such an integral part of society for some reason. In addition, I'm not sure it makes much sense to have no post two days in a row.

Sean Gao said...

Although this 1% doesn't seem like much, veterans are outraged because they fear that this cut will lead to even greater percentage cuts down the line. However, it needs to be noted that this deal isn't really a "cut"—the deal will reduce the cost-of-living adjustment added on to the original pension annually, so veterans still receive more money each year. Also, retirees after the age of 62 do not face these reductions, and so most veterans under this age can still take additional jobs on top of this pension.

In response to the first question, there is no real "simple plan" for budget cuts, as no matter what people will be angered. The proposal to end Saturday mail has already met union backlash, and the responses to other proposals are similarly negative.