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National Defense > Blog > Posts > Blue Ribbon Panel Begins Contentious Debate on Military Compensation
Blue Ribbon Panel Begins Contentious Debate on Military Compensation
By Sandra I. Erwin



A bipartisan group of former lawmakers and retired officers will spend the next six to nine months delving into one of the most divisive issues in Washington today: Reforming military compensation for an era of shrinking budgets.

The Military Compensation and Retirement Modernization Commission recently opened for business in Arlington, Va. The National Defense Authorization Act for Fiscal Year 2013 established the nine-member panel. Congress typically sets up independent commissions to tackle politically tough issues like base closures. Military compensation is just as contentious, often described as the third rail of the Pentagon’s budget.

The group will review every military compensation and retirement program and make recommendations  — on whether these programs should be kept as is or changed — to the president and Congress by Spring 2014. In a Sept. 26 statement, the commission announced its goals are to “ensure the long-term health of the all-volunteer force, a high quality of life for the members of the armed forces and their families, and make sure that the compensation and retirement programs are financially sustainable.”

How to strike the right balance among these goals could be difficult as military spending begins a projected decade-long downturn and the cost of active-duty and retiree compensation continues to rise at above-inflation rates, experts said.

The commission will begin conducting hearings as early as October, said spokesman James Graybeal. “We plan to talk to veterans, families and also advocacy groups on all sides of the issue,” he said.

The panel also will examine the work done by think tanks on this issue. Defense budget analyst Todd Harrison, of the Center for Strategic and Budgetary Assessments, led a 2012 study that concluded that the all-volunteer force, in its current form, is financially unsustainable.

Over the past decade, the cost per person in the active duty force increased by 46 percent, Harrison said. “If personnel costs continue growing at that rate and the overall defense budget remains flat with inflation, military personnel costs will consume the entire defense budget by 2039.”

Harrison suggested that compensation programs are outdated and should be better tailored to members’ preferences. Service members of all ranks, for instance, place a high value on basic pay, especially those at the lower end of the pay scale, but service members at all stages of their career do not always value free TRICARE for Life health insurance, the CSBA study concluded.

Retirement benefits also should be restructured, Harrison said. “More than 80 percent of service members in each age group would be willing to have the retirement eligibility age raised to 50 in exchange for a 1 percent increase in basic pay,” he added. “Keeping faith with the troops should not preclude changes to the compensation system.” The study, said Harrison, “demonstrates that the Defense Department can improve the value of its compensation system by making changes the troops prefer while also reducing costs.”

On the other side of the debate are groups that oppose changes to retiree benefits such as the Military Officers Association of America. “MOAA intends to use its influence and that of its 380,000-plus members to fight” proposals to curtail benefits, the association said in a statement. MOAA opposes the suggested pay cap for currently serving members of the uniformed services of 1 percent and the Pentagon’s plan to shift $25 billion in costs to military beneficiaries by raising annual TRICARE fees by $1,000 or more for retired families.

“Military pay along with strong health care and retirement benefits are the foundational elements necessary to not just recruit, but also sustain an all-volunteer force,” said MOAA President and CEO Norb Ryan Jr. “The last time the government cut back on military pay and benefits, the results were disastrous by the late ‘90s,” he said. “It simply didn’t work then and it’s taken the past 12 years to rebuild what was lost.”

The Military Compensation and Retirement Modernization Commission is chaired by Alphonso Maldon Jr, a longtime financial industry executive and former assistant secretary of defense for force management policy. Other members include former Congressmen Steve Buyer and Chris Carney; retired Army Gen. Peter W. Chiarelli; retired Navy Adm. Edmund Giambastiani Jr.; Mike Higgins, a retired Air Force officer and former professional staff member of the House Armed Services Committee; former Sens. Bob Kerrey and Larry Pressler; and Dov Zakheim, former undersecretary of defense, comptroller.

Photo Credit: Thinkstock

Comments

Re: Blue Ribbon Panel Begins Contentious Debate on Military Compensation

The continuing argument is that military service is a job just like any other.  If this is true then where were my overtime checks.  Obviously I am misinformed so will three service members who received regular overtime checks or payments please correct me.
David Kubista at 9/27/2013 6:41 PM

Re: Blue Ribbon Panel Begins Contentious Debate on Military Compensation

I believe all individuals upon graduation from HS but no later than 21 years of age should give a 18-24 months in the service or 24-36 months in the peace corps without any guaranteed benefits during this time.  Afterwards, if they meet all the standards and want to stay in to make it a career, they are able to pick the careerfield of choice and then earn benefits as they stay in.  Then, you will have a generation that understands the sacrifices of the military life.  Although the lawmakers/Congress wants to reduce both active duty and retirees' benefits, I caution that the word of mouth through generations means a lot.  I just retired this month and with talks like this, I would caution anyone asking for advice about volunteering in the military and making a career.  Service members sacrifice more in one enlistment then most of our counterparts in any particular career field will see in a lifetime.  Many service members have residual suffering on multiple levels, personal, professional, mental, physical, social and financial as they give to their country with their lives on the line.  If Congress really wants to cut back on a budget, try looking in the mirror and start in their own home.
Jeanine Steele at 9/27/2013 8:53 PM

Re: Blue Ribbon Panel Begins Contentious Debate on Military Compensation

It seem that we military service men and women join and do our commitment out of understanding that we will receive two things. One self satisfaction that we are protecting our nation and families and two that if we provide this service we will be rewarded for those years away from family, for hardships of not being able to pay bills because the cost of living in an area is very high for that junior troop to support his wife and little one. The hardships are compensated with benefits removed by politicians who think that their time served stateside is greater of a sacrifice than years deployed to sand and rock or rolling hot seas. The current GI bill is a great advancement. But removing our medical benefits that we were promised and lowering or reducing our retirement compensation because we throw money away in other area. Why devote our lives to the military. Congressman/ Senator you spend 20 years at our pay for the hours served. You would not think twice about how I earned each penny! GySgt USMC ret.
Steven Chavez at 9/30/2013 6:38 PM

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