The 'good old days' coming back?

Friday - 2/22/2013, 2:00am EST

Remember the good old days? The years 2010, 2011 and a few weeks of 2012?

Back in the day, all you had to worry about work-wise was your health-insurance premiums going up, your retirement benefits going down and a loss of inflation protection to your pensions.

Those were the good old days because, as it turns out, none of those threats even came close to becoming reality. It was, in retrospect, a happier time before everybody started using the S-word. Sequestration. And it is possible that sequestration may trigger a new look at key federal benefits and quick action to reduce them.

It started in 2010 when the bipartisan Simpson-Bowles report was made public. As per White House instructions, it came up with a list of cuts in many government programs. The idea was that Congress — as it did with the Defense Department BRAC commission — would approve the cuts and that would be that.

The report hit federal benefits hard. It said they are better than anything in the private sector. It said that federal and postal workers and retirees should pay a bigger share of their health premiums. (Uncle Sam now picks up about 70 percent for white-collar feds, even more for postal workers.) It recommended a voucher system that would give workers and retirees a fixed amount of money to buy their own insurance. The thought was that many people, to save money, would shop for less-expensive, fewer-frills plans reducing costs to the government.

The Simpson-Bowles panel report echoed what many have said and thought in the past: That the formula used to determine federal benefits (the employees highest three-year average salary) was much too generous. It proposed a high-five system. That caught the attention of many federal workers. Some said they would retire early before the change could be made. Some did, even though in the end, nothing happened. Which is what makes 2010-2011 the good old days!

The commission also recommended a new yardstick (called the chained CPI) be used to calculate future cost-of-living adjustments for federal, military and Social Security retirees. That change would mean smaller COLAs each and every year. A lot of federal, postal and retiree groups said it was the unkindest cut of all.

But at the last minute, White House and congressional interest in Simpson-Bowles seemed to fade away. Many people, however, predicted it would be back — perhaps in a different or modified form. It has. While short on specifics, it does call for "modernizing" federal civilian and military health and retirement programs. Modernizing means making them less costly to the taxpayer and more costly to those getting the benefits. That would be you.

Now the crisis du jour is sequestration. The all-too-familiar S-word. Due to kick in next Friday. A week from today. The concern is will the S hit the fan? And, if so, how bad will it be and how long with it last? Will it send the stock market into a nose dive and produce another recession? Will — as predicted by some — millions of people lose their jobs? Some, maybe many, federal workers face one-day-per-week furloughs for up to 22 days. Contractors will be hit just as hard except some of them, maybe a lot, could permanently lose their jobs.

The politicians still have a week to act. And if they don't, it will still be weeks before sequestration begins to make significant inroads. And even longer until furloughs begin.

Some people think the new Simpson-Bowles could be a way out. A method to provide significant and highly visible savings (with feds shouldering much of the burden) and to give politicians of both parties a face-saving way out.


Compiled by Jack Moore

Today's NUF:

Sixty-eight percent of U.S. Presidents owned dogs while in office, according to VetStreet. Nine percent of Presidents owned goats while in office.

Mea Culpa:

Thursday's Nearly Useless Factoid contained the misspelling of the word, "syzygy."

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