Military retiree benefits vulnerable as Congress struggles to cut debt.
As Washington looks to squeeze savings from once-sacrosanct entitlements like Social Security and Medicare, another big social welfare system is growing as rapidly, but with far less scrutiny: the health and pension benefits of military retirees.
Military pensions and health care for active and retired troops now cost the government about $100 billion a year, representing an expanding portion of both the Pentagon budget — about $700 billion a year, including war costs — and the national debt, which together finance the programs.
And if Congress fails to adopt the deficit-reduction recommendations of a bipartisan joint Congressional committee this fall, the Defense Department will be required under debt ceiling legislation passed in August to find about $900 billion in savings over the coming decade. Cuts that deep will almost certainly entail reducing personnel benefits for active and retired troops, Pentagon officials and analysts say.
“We’ve got to put everything on the table,” Defense Secretary Leon E. Panetta said recently on PBS, acknowledging that he was looking at proposals to rein in pension costs.
Under the current rules, service members who retire after 20 years are eligible for pensions that pay half their salaries for life, indexed for inflation, even if they leave at age 38. They are also eligible for lifetime health insurance through the military’s system, Tricare, at a small fraction of the cost of private insurance, prompting many working veterans to shun employer health plans in favor of military insurance.
NOTE: The bipartisan joint Congressional committee must make their recommendations by 23 November 2011 as to what steps that need to be taken, under the debt ceiling legislation passed in August, to find about $900 billion in savings over the coming decade. This amount is in addition to any additional cuts, that the President may ask them to take, in support of his "American Jobs Plan.
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