While vast numbers of the private-sector workforce have seen their pensions vanish over recent decades and find themselves with precarious, market-based 401(k) plans, members of Congress receive both a pension and a quality employer-match plan.
According to at least two lawmakers, it’s time for elected officials to join the real world.
“If you compare the private sector to what the folks in the federal government get, in the federal government you not only get healthcare benefits, you get a 401(k) that has a higher match than most private-sector companies,” Rep. Tim GriffinTim GriffinFlynn discloses lobbying that may have helped Turkey Tea Party class reassesses record Huckabee's daughter to run '16 campaign MORE (R-Ark.) told The Hill.
In an effort both to identify cost savings amid the nation’s growing debt crisis and to give federal lawmakers more credibility in addressing related financial issues, Griffin and Rep. Mike Coffman (R-Colo.) have recently introduced separate proposals for the elimination of pension benefits for members of Congress.
In mid-November, Griffin put forward legislation terminating congressional pensions for future elected officials. Two months earlier, Coffman introduced stricter legislation to eliminate lawmakers’ pensions.
Members of Congress are eligible for a combination of retirement benefits, including Social Security and a pension plan called the Civil Service Retirement System (CSRS).
Like other federal employees, lawmakers’ pensions are financed through a combination of employee and employer contributions, according to a 2011 open source Congressional Research Service report studying retirement benefits.
“All members pay Social Security payroll taxes equal to 6.2 percent of the Social Security taxable wage base ($106,800 in 2011),” according to the report. “Members enrolled in [the Federal Employees Retirement System (FERS)] also pay 1.3 percent of full salary to the Civil Service Retirement and Disability Fund.”
According to Dan Weiser, communications director for the Office of the Chief Administrative Officer, members are required to make employee contributions to either CSRS or FERS.
“A member's retirement benefit is determined by several factors, such as age at time of retirement, possible prior federal civilian service and high average three-year salary,” Weiser wrote in an email.
As of October 2009, 455 retired members of Congress were receiving federal pensions, according to CRS. Of that number, 275 were receiving an average annual pension of $69,012, and 180 members received an average annual pension of $40,140.
Members as well as other federal employees also have a 401(k) equivalent called the Thrift Savings Plan, in which employees can contribute and receive matching employer contributions.
According to Griffin, his proposal is part of a larger plan to eliminate pension benefits across the federal government.
Cutting member pensions and relying instead on the Thrift Savings Plan represents a savings of hundreds of millions of taxpayer dollars. But, Griffin pointed out, that amount is just a drop in the bucket compared with the hundreds of billions that could be saved by eliminating pension benefits across the federal government.
“This for me is less about the money you save and it’s more about being credible when we take on the bigger issue of civil service pensions, because that is where the real money is,” Griffin explained.
“We can’t have a credible discussion on that issue of civil service pensions until people in the House and Senate address their own,” Griffin said.
That “credible discussion” is one the nation must have, he said.
“We can’t be paying pensions to the next generation of federal workers when hardly anyone in the private sector gets them,” Griffin said.
Pensions have become less common over the last two decades, as many private companies have turned to employee contribution plans like 401(k)s.
Many Americans who still receive pension benefits have also seen them plummet as failing corporations are forced to raid pension funds to stay afloat.
“The bottom line is we can’t afford to keep doing it this way,” Griffin said. “On Oct. 1 of last year, the civil service trust fund had an unfunded liability of $673 billion, half a trillion dollars … Our current system is unsustainable.”
Griffin has not yet approached GOP leadership or committee chairmen regarding his resolution, but plans to. When asked if his congressional colleagues supported his proposal, Griffin noted that the proposed legislation was still in its early stages.
“I think there are some who are supportive and some who won’t be,” he said. “But here’s the deal, this grandfathers everybody in. It doesn’t impact anyone I’m serving with; this is for the next Congress.”
It’s this grandfathering-in of current lawmakers with which Coffman takes issue.
Coffman’s proposed legislation would not only eliminate pension benefits for future lawmakers, but would end benefits for those members already serving in Congress.
Referred to the Subcommittee on the Federal Workforce, U.S. Postal Service and Labor Policy in early October, the resolution has gained 12 co-sponsors, including Reps. Virginia FoxxVirginia FoxxTrump, Congress, cut these regs to make higher education great again A guide to the committees: House Repeal without replacement: A bad strategy for kids MORE (R-N.C.), Ron Paul (R-Texas) and Jared Polis (D-Colo.).
Coffman’s proposal has also received public backing from taxpayer advocacy groups Americans for Tax Reform, Citizens Against Government Waste and the National Taxpayers Union.
“In order for Congress to navigate its way out of this debt crisis, we’re going to have to make some difficult decisions that involve a number of programs and benefits enjoyed by a lot of Americans,” Coffman said. “I felt that for Congress to have the moral authority to make some of those tough decisions, they ought to make a sacrifice themselves and lead by example.”
Coffman noted that his legislation would recognize and honor any pension credits accrued by members to the point of the bill becoming effective, but none after that time. According to Coffman’s office, such a measure could result in savings of more than $13 million a year for the current Congress alone.
But “it’s not about the money, it’s more about the leadership of Congress,” he added. “I just think this is a sore spot with a lot of Americans, that members of Congress have a benefit that’s not available to most.”
Coffman acknowledged that he, too, has received mixed feedback from congressional colleagues, and noted that conversations he’d had with “leading conservatives” on his proposal did not go as expected.
“There are conservatives I talked to who I thought would be right on board with the proposal because they’ve been tough on everybody else, but not themselves. I was kind of surprised by that,” he said, declining to offer names. “They’re cutting everybody else’s pay and benefits in the federal government, but not their own.”
This is far from surprising in the realm of politics, according to Senate Historian Don Ritchie.
“There are a lot of members, especially in the House, who run for Congress by running against Congress,” he said. “Campaigning against Congress or suggesting that Congress has a lot of perks is popular politics.”
Coffman is hopeful that the public has been paying attention and will support his plan and put pressure on its representatives to do the right thing regarding their own benefits.
Congressional feedback has been “probably more negative than positive, but I’m hoping that the negative people, under pressure from the American people, will come on board,” he said.
Regarding Griffin’s proposal that would only affect incoming lawmakers in the next Congress, Coffman said he preferred his “more aggressive” initiative because it affects sitting members as well.
But that didn’t mean he would rule out supporting Griffin’s resolution down the line.
“I plan on adding a co-sponsor a week; that’s my goal: just keep going on it,” he said. “But if I top out where I’m not getting any support, it looks like I’m not going to get it heard, get a vote on it, and if I reach that point and that understanding, then I’ll certainly support Tim Griffin’s proposal.
“I think mine’s better, but I’ll take his before I simply say, ‘OK, we’re not going to have anything,’ ” Coffman said.
-- This story was updated at 11:38 a.m.