washingtonscene
LEGISLATIVE NEWS THAT AFFECTS YOU
Quote of the Month • “The military budget
Caps and You
Government leaders persist in dangerous brinksmanship to gain leverage for their preferred budget-cutting proposals. What are the possible implications of the various proposals for you and yours?
I
f you’ve been following the ongo- ing debt ceiling/budget negotia- tions (and you should be), you know multiple plans have been offered by vari- ous individuals or groups to cap federal spending or require a balanced budget. Those sound reasonable in concept.
(How can a balanced budget not be a good thing?) But how much do you understand about how they would affect you? In many cases, the specifics are vague — either because they have yet to be worked out or because it’s inconvenient to have constituents understand exactly what kind of pain would be involved before these proposals are voted on. In some cases, proposals have been
pretty specific. In others, effects have to be inferred by doing some math. Let’s look at the “Cut, Cap, and Balance” legislation (H.R. 2560) that was passed by the House of Representatives July 19 by a vote of 234-190 — and then blocked in the Senate later that week by a 51-46 vote. Among other things, that legislation
envisioned capping federal outlays more severely each year, eventually driving government spending below 20 percent of the GDP by FY 2017. The GDP represents total government, commercial, and private spending in a year for the U.S. For 2012, federal spending currently is
projected at about 24 percent of the GDP. For FY 2014 and subsequent years,
H.R. 2560 would explicitly exempt mili- tary personnel accounts, military (but
not federal civilian) retired pay, TRI- CARE For Life (TFL), Medicare, Social Security, and veterans’ benefits from required cuts. But exemptions for FY 2012 would include only Social Security, Medicare, veterans’ benefits, and net interest. Spend- ing on nonexempt “mandatory spending” programs for FY 2012 would be capped at $680.7 billion — an apparent 21.7-percent cut below the $828.6 billion requested in the administration’s FY 2012 budget for those programs. While the Senate’s blocking vote ren-
dered the issue moot, the potential for large one-time program cuts in FY 2012 still is disturbing. One of the most modest plans is the
Corker-McCaskill budget cap bill (S. 245) that would phase in reductions at a more moderate pace, limiting FY 2013 spend- ing to 25 percent of the FY 2009-11 aver- age GDP, with further reductions in later years. It would allow no exemptions. S. 245 would require a 5-percent cut in
FY 2013 outlays for retired pay, TFL, and the Survivor Benefit Plan (SBP), for exam- ple, with cuts escalating each year — to 19 percent by FY 2021. Giving up COLAs for five years would be a head start to meet those goals, but more would be needed — perhaps rolling back some concurrent receipt payments. A 5-percent cut in TFL would require something on the order of a $350-per- person annual TFL deductible. For SBP,
*take action: Urge your legislators to resist retirement cuts. Visit
http://capwiz.com/moaa/issues. SEPTEMBER 2011 MILITARY OFFICER 31
is not on the table. The military is at the table, and it is eating every- body else’s lunch.” Rep. Barney Frank (D-Mass.), commenting on House passage of the $649 billion FY 2012 Defense Appropriations Bill. Sentiment is growing among legislators of the left and right alike that serious defense cuts must be part of any budget deal.
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