Hearing of the Senate Armed Services Committee - Recent Changes to the U.S. Military Retirement System

Hearing

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Senator WICKER. Thank you, Mr. Chairman. A real important hearing and I appreciate you calling it and, Mr. Chairman, I appreciate you starting out at the outset saying that this CPI Minus One was wrong and it needs to be fixed.

As a matter of fact, not a single voice has been raised on either side of the dais today in support of what this Congress enacted and what was signed into law. I appreciate this. I also want us to appreciate the seriousness of this hit to the military retirees that are affected. It hasn't been mentioned yet today. If either witness wants to challenge me on this, now's the time to do it. But for the typical enlisted military person who retires below the age of 62, this is going to mean a lifetime hit of somewhere between 70 and $80,000 or more lifetime to that military member.

Correct me if I'm wrong there, but that's been substantiated over and over. It depends on exactly when the enlisted person retires and exactly what their rank was at the time. For officers it's even more. It's over $100,000 out of their pockets lifetime. So this is a serious matter. ""CPI Minus One'' sometimes can appear to diminish the profound effect this has.

Let me ask you, Secretary Fox--and let me acknowledge also to both of you, I understand the problems that you're facing and the daunting task that you have in making the numbers come out. We want to work with you on that. That's why we established the commission with certain parameters.

As I understand it, Secretary Fox, you're sorry this was enacted, you're glad it's been corrected with regard to disabled military retirees, and you want to fix it, but you want us to wait 13 months to fix it for everyone else; is that correct?

Ms. FOX. Yes, sir. We want it be informed by the results of the commission.

Senator WICKER. Now, why was it a good idea to fix it--it wasn't going to go into effect until December 2015 for the disabled retirees. Why was it a good idea to go ahead and fix it for them?

Ms. FOX. Well, sir, I think that the disabled retirees' cases is very clear. I think that whether to do anything with disabled retirees is just not a part of any----

Senator WICKER. Well, I think it was clear. I think it's clear on the rest of them, too. It seems to be clear up and down the aisle. So if it was clear for them and if we're unanimous in this room and unanimous at the witness table that this is a wrong that should be fixed, it seems to me it ought to be made clear.

Admiral Winnefeld, you mentioned predictability. We have an opportunity. We have pay-fors proposed on both sides of the aisle to do this. It seems to me it doesn't make any sense, if we're all in agreement on this, to wait, unless you want to hold out the possibility that we may stick with this. Now, if you want to send that signal then waiting for a commission report or waiting 18 months might be a good idea. But if we're all agreed this is wrong, shouldn't have been done, we can pay for it elsewhere, it seems to me that it makes no more sense to postpone this for 13 months than it did for the other clear case.

It kind of reminds me of sequestration. Mr. Chairman, we had witness after witness appear before this committee and other committees: We're not going to have sequestration in the United States of America. We had witnesses from agencies tell committee after committee: We're not even making plans for sequestration because it is so unthinkable, it is so heinous, that we know this is not going to happen. The President of the United States said in a debate: Not going to be any sequestration.

We hoped that was true, but it wasn't true. Sequestration did happen. To me to say we know this should be fixed, we know it's wrong, we know it was the wrong approach, we regret it, but let's wait, to me it holds out the potential that it'll be like sequestration and go into effect despite everyone's protestations to the contrary. You know, we said there's not going to be sequestration. There was sequestration. We were told in this city repeatedly if you like your health plan you get to keep it, period. It turns out that that wasn't the case. We've told military members: You do your side of the bargain, you signed up for worldwide duty, you place yourself in an assignment to regions where you're in harm's way, and we're going to keep our promise to you. And last month we broke that promise, and now we're being told, let's just wait 13 months before we fix that.

I really, I can't go along with that. I would say to my colleagues, this is about a promise that everybody says we need to keep, and it's also about the process. My friend from Arizona said this came out of the Budget Committee. This didn't come out of the Budget Committee. It came from behind closed doors and was authored by
two individuals and presented to us as a package, take it or leave it.

If we would start following the process in this Congress, if the budget conference had been allowed to vote on it, to debate it, to hear amendments, we might have adopted Senator Ayotte's offsets. We could have come up with these savings elsewhere. If we had had an amendment process like the rules call for in the budget bill, we would have had opportunities on a bipartisan basis to pay for this elsewhere, to have these savings elsewhere, to keep our promise to the people who fulfilled their promise to the security of the United States of America. If we had had this in the omnibus bill. We need to get back to following the rules around this Congress. If this had seen the light of day, the elected representatives of the American people, the 100 Senators, the 435 members of Congress, would never have stood for this broken promise. I think this ought to be a lesson to us. Let's keep promises, but there's a reason we've got rules around here. It's not to waive and it's not to get around them, because generally it ends up with bad policy.

I thank you. I want to work with you, but I have to say we need to go ahead and act. Everyone acknowledges this was wrong and if it was wrong we need to go ahead and send the signal that we're going to make it right.

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