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2013 - so far, so good...
Thursday - 1/3/2013, 2:00am EST
And the good news is that 2013, so far, has been a really good year. The world didn't end Dec. 21, Christmas came off without a hitch. Congress and the White House, as most predicted, avoided taking the nation over the fiscal cliff. There is even a possible federal pay raise on the horizon. That is the good news.
The not-so-good-news is that there are 362 more days to go. All of the bad stuff that didn't happen last year (and last week) will be back as Congress and the White House resume their brinkmanship battle over the debt limit and a variety of other issues and nonissues as they prep and posture for the 2014 elections.
A modest (make that very modest) federal pay raise of 0.5 percent is back in play. After freezing federal salaries for 2011 and 2012, the White House last year proposed the half percentage point increase that is supposed to be effective March 31, 2013. That's when the current continuing resolution — which funds most federal agencies — ends.
At play are:
- Future pension increases. The much-feared chained CPI (a new formula that would have reduced future cost-of-living adjustments for federal-military-Social Security retirees) is gone. For now. The GOP plan has been endorsed by The Washington Post, meaning congressional Democrats have the green light to back it. That likely means it will be back, perhaps as part of the upcoming food fight over raising the debt limit. Some insiders say it is not a matter of if, but rather when, the chained CPI will become the law of the land. Democrats are well aware that the chained CPI concept (which would slow inflation adjustments by almost $300 billion over the next 10 years) was endorsed by the Simpson-Bowles Commission set up by the White House.
- On-again, off-again pay raise. Meantime, that "maybe" 0.5 percent pay raise in March could well be scuttled by proposals to extend the pay freeze another year. Or more. The House has already voted to extend the freeze through 2013. The Senate will probably balk. Then what?
Given what the nation has been through — the clumsy and prolonged fiscal cliff ballet — and extended pay freezes in the private sector, it is not hard to see the public backing an extension of the federal pay freeze. The fact that federal health premiums rose an average of 4.5 percent in 2013 won't get much sympathy in the private sector where premiums are up an average of 6 percent and employers pay a much smaller portion of the total premium, or among the 12 million unemployed who can't get or afford health insurance.
- Higher pension payments. Starting in 2013, new federal and postal hires will be required to pay an additional 1.3 percent in retirement contributions. The good news for the media, lobbyists and special-interest groups which thrive during bad times, is that 2013 is probably going to look a lot like 2012.
NEARLY USELESS FACTOID
By Jack Moore
Today is "Fruitcake Toss Day," according to Hallmark. Citing "obscure holiday etiquette," the site says today is the day when it's socially acceptable to pitch the holiday dessert.
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