What happens when you order steak and get Spam cutlets?

Wednesday - 2/26/2014, 2:00am EST

The high-pitched, reactive nasal sound you heard when federal unions commented on the proposed 1 percent 2015 pay raise is because they are holding their noses — and trying to control their blood pressure — when speaking out.

Virtually all federal and postal unions enthusiastically endorsed and supported President Obama in both presidential elections. And things looked good. For a year.

A number of long-sought, long-pending benefit improvements were signed into law in 2009. It looked like the beginning of a long and happy affair.

Long? Yes. Happy? Not so much!

Pressure from unions and congressional Democrats persuaded the White House to drop its support for the so-called chained CPI. But administration officials concerned about the deficit would not be unhappy if Republicans in Congress forced the issue. Which they might.

If the chained CPI replaced the current method of measuring inflation, it would chop tens of thousands of dollars from future cost-of-living adjustments (COLAs) to federal, military and Social Security retirees. But that may be the only concession they win from the administration in this election year. For more on that, click here.

The blue ribbon Simpson-Bowles commission, appointed by the President, was the first to recommend a two-year federal pay freeze. The White House then proposed it and Congress, led by the GOP-dominated House, made it three years. The first post-freeze pay hike, of 1 percent, was proposed by the President taking effect in January of this year. He's expected to propose another 1 percent raise in his 2015 budget.

The White House quietly infuriated unions when it proposed an increase in employee contributions to the retirement program. Congress later approved increases for new federal workers. So now, employees under the largest plan, the Federal Employees Retirement System, pay three different rates.

FERS employees hired before 2013 contribute 0.8 percent of their salary to the civil service retirement fund. Those hired last year contribute 3.1 percent and those hired starting Jan. 1 of this year kick in 4.4 percent. All FERS workers also pay 6.2 percent of salary into Social Security up to the first $117,000 of salary.

A new report by the Congressional Research Service says that the old Civil Service Retirement System equals 26 percent of salary, with the government providing 19 percent of that amount in benefits. It says the less- expensive FERS program is the equivalent of 12.7 percent of total compensation. Unlike many state and local government pension plans, CRS says the federal programs are adequately funded well into the future and are ultimately guaranteed by the full faith and credit of the government.

So what's in it for you in 2014?

That will be the subject of today's Your Turn radio show at 10 a.m. Federal Times writers Andy Medici and Sean Reilly will talk about the issues for federal and postal workers this year. Later on, Jessica Klement legislative director of the National Active and Retired Federal Employees will update the outlook for feds in this election-year.

Listen if you can (1500 AM or online), and if you have questions email them to me at mcausey@federalnewsradio.com or call in during the show at (202) 465-3080. The show will be archived here.


NEARLY USELESS FACTOID

Compiled by Jack Moore

When Fig Newtons were first introduced in the 1890s, they were marketed on product packaging as "cakes." It remained that way until the 1980s when they were rebranded "chewy cookies."

(Source: The New York Times)


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