Veterans, Savings, a Contentious Hearing
(This article appears in the May-June 2014 issue of The American Postal Worker magazine.)
John L. Marcotte, Legislative & Political Department Director
It’s rarely quiet in the legislative arena, and as past President Moe Biller was fond of saying, “The struggle continues.”
Senate bill 1950, which would have repealed a cut to cost-of-living adjustments for future military retirees, was defeated on Feb. 4. Although all Senate Democrats voted in favor of the measure, it lacked sufficient Republican support to waive a spending limit in the budget Congress approved in December.
Sen. Bernie Sanders (I-VT), chairman of the Veterans Affairs Committee, fought hard for the measure. He was willing to pay for it with savings from reduced “overseas contingency operations,” but opponents refused.
Daniel M. Dellinger, national commander of the American Legion, said, “I don’t know how anyone who voted ‘no’ today can look a veteran in the eye and justify that vote… Our veterans deserve more than what they got today.” I agree, sir!
Smart Savings
On March 11, the House Committee on Oversight and Government Reform approved the Smart Savings Act, a bipartisan bill that reflects a change suggested by the TSP Board. Currently, if no allocations for TSP deposits are selected, the default is the G fund, a low-yield fund that is not recommended for employees who are far from retirement.
The bill, which was introduced by Rep. Darrell Issa (R-CA-49) and Rep. Elijah Cummings (D-MD-7), would change the default option to a Lifecycle fund, which mixes investments based on an employee’s target retirement date.
The bill would allow participants to change funds at any time.
A Contentious Hearing
The Federal Workforce subcommittee held a contentious hearing on the Postal Service’s “unfunded liabilities” on March 13.
The chairman, Rep. Blake Farenthold (R-TX-27), said the USPS is broke and has massive unfunded liabilities, suggesting there is no hope for revenue to match expenses. He also cited the fact that the Department of Defense (DoD) pre-funds Tri-care, in an attempt to justify the requirement that the USPS pre-fund future retirees’ healthcare and workers compensation.
Rep. Farenthold also commented that there are long lines at post offi ces because people wait too long to mail Christmas packages, not due to cuts in window staffi ng, which we know is to blame.
This manipulation of the truth went on for quite a while, until Rep. William “Lacy” Clay (D-MO-1) thundered to the workers’ defense with a stream of questions to representatives of the USPS, Government Accounting Office (GAO) and DoD.
Rep. Clay’s questions brought out the following facts:
- The DoD pre-funds Tri-care through budget appropriations, using tax dollars.
- The USPS costs taxpayers nothing.
- The USPS has pre-funded a higher percentage of retiree healthcare benefi ts and has a smaller unfunded liability than the DoD, even though the DoD has been pre-funding about twice as long.
Next, Rep. Stephen Lynch (D-MA-8) got the GAO witness to admit his agency could support using USPS overpayments to the Federal Employees Retirement System (FERS) to pay down postal liabilities. FERS overpayments, currently estimated at between $9 billion and $12 billion, would go a long way toward paying down the Postal Service’s debt to the Fed, which stands at $15 billion – the legal limit. This would make money immediately available to the USPS to improve postal infrastructure.
Rep. Lynch closed by telling the USPS witness that Medicare Part B integration should be addressed in negotiations with postal unions, not in Congress. Nicely done, Mr. Lynch and Mr. Clay!
The APWU continues to build opposition to S.1486 in the Senate, which would cut service and hurt workers. Your efforts at home are starting to have a positive effect. Please let your senators know that this is a bad bill.