Putting Military Pay on the Table
By THE EDITORIAL BOARD
Published: November 30, 2013 205 Comments
Big-ticket weapons like aircraft carriers and the F-35 fighter jet have
to be part of any conversation about cutting Pentagon spending to
satisfy the mandatory budget reductions known as the sequester. But
compensation for military personnel has to be on the table, too — even
though no other defense issue is more politically volatile or
emotionally fraught.
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Readers’ Comments
Readers shared their thoughts on this article.
After a decade of war, the very idea of cutting benefits to soldiers,
sailors and Marines who put their lives on the line seems ungrateful.
But America’s involvement in Iraq and Afghanistan is over or winding
down, and the Pentagon is obliged to find nearly $1 trillion in savings
over 10 years. Tough choices will be required in all parts of the
budget. Compensation includes pay, retirement benefits, health care and
housing allowances. It consumes about half the military budget, and it
is increasing.
In a speech last month, Defense Secretary Chuck Hagel warned that
without serious savings in this area, “we risk becoming an unbalanced
force, one that is well compensated but poorly trained and equipped,
with limited readiness and capability.” Meanwhile, Gen. Ray Odierno, the
Army chief of staff, told a hearing: “The cost of a soldier has doubled
since 2001; it’s going to almost double again by 2025. We can’t go on
like this, so we have to come up with [new] compensation packages.”
The Wall Street Journal reported recently that military commanders have
agreed to a plan that would curb the growth of pay and benefits for
housing, education and health. But it must still be approved by Mr.
Hagel and President Obama. In past years, Congress has approved pay
raises and benefit improvements and resisted rollbacks. It is possible
that politically savvy Pentagon leaders may be hitting the personnel
issue hard right now to force lawmakers to end the sequester or to
otherwise soften its blow to the overall military budget. Personnel
costs are not the only ones rising. Weapons procurement has risen 88
percent from 2001 to 2012.
But many Washington-based think tanks, spanning all ideologies, are also
pushing reform. In June, a group of them — including the conservative
American Enterprise Institute and the liberal Center for American
Progress — called for a comprehensive review and modernization of the
military compensation system, which has been largely unchanged for 40
years.
One problem is that unrestrained compensation costs will edge out funds
for training, readiness and weapons. A recent Congressional Budget
Office study said that between 2001 and 2012, when private-sector wages
were effectively flat, basic military pay rose by 28 percent in
inflation-adjusted dollars. The study also said that cash compensation
for enlisted personnel, including food and housing allowances, is
greater than the wages and salaries of 90 percent of their civilian
counterparts. And health care costs are projected to rise from $51
billion in 2013 to $77 billion by 2022.
Where, then, to cut? Reducing the size of the armed forces would have
the quickest effect. The budget office suggests giving smaller pay
raises; replacing the current retirement system, under which active-duty
members qualify for immediate benefits after 20 years of service, with a
defined benefit system that partially vests earlier in a service
member’s career; and increasing health care enrollment fees, deductibles
or co-payments. Military retirees pay only a fraction of what civilians
pay for health care premiums, and those with second careers often
choose to stay on the government plan. It makes sense that they be asked
to assume a greater share. To the extent possible, any changes should
affect future recruits rather than current enlistees.
Soldiers must be adequately compensated. But when programs across the
government are being slashed, including those affecting the most
vulnerable Americans, no budget account can be immune from reductions
and reforms. It is a difficult balance to get right.