Leaders of federal employee-retiree groups are flexing muscles and calling in political IOUs to head off cuts tentatively approved by the White House-congressional budget summit at Andrews Air Force Base.
In the House, the damage-control effort is being spearheaded by two pro-federal worker legislators with contrasting styles:
Rep. Steny H. Hoyer (D-Md.), the leadership insider, is trying quiet persuasion and proposing compromises to budget negotiators.
Rep. Mary Rose Oakar (D-Ohio) is using a verbal sledgehammer to get the attention of House members who, she says, are trying to balance the budget on the backs of government workers and retirees.
Oakar was the first speaker before the House yesterday. She told members it is "absolutely absurd" to consider freezing federal pensions when 337 of the 435 members are cosponsors of her bill that promises retirees a full raise in January. If Congress wants to save money, she said, let it vote to cut the Strategic Defense Initiative, also known as the Star Wars missile defense program, rather than "clobbering federal retirees."
On Wednesday, participants in the budget summit tentatively agreed to cut $3.8 billion by freezing federal-military pensions through 1992 and then limiting retirees' raises to 1 percentage point less than the actual rise in cost of living. They also agreed to end the popular lump-sum pension option, which allows retirees to take reduced pensions in return for lump-sum payments equal to their pension plan contributions.
If the cuts stand, they will constitute the toughest hit federal workers and retirees have taken since the Depression. To avoid that, budget summit participants will be asked to consider a compromise that would:
Keep the lump-sum payments but spread them over three years instead of two.
Give federal pension benefits the same inflation protection as Social Security. Under the plan, U.S. retirees would get full COLAs on the first $975 of monthly pension benefits. Amounts over that level, which is the maximum Social Security payment, would be subject to the reduced-COLA formula. The average federal pension is $1,100 a month before taxes.
Let the House Post Office and Civil Service Committee and the Senate Governmental Affairs Committee decide where to make $900 million in cuts assigned to federal benefits. Both are sensitive to U.S. workers and would make the cuts as painless as possible.
The National Association of Retired Federal Employees' convention in Louisville slapped a freeze yesterday on its $1.6 million political action fund until Congress settles the budget issue. That means members of Congress seeking reelection who support the pension freeze can forget about contributions.
At noon tomorrow on radio station WNTR (1050 AM), Washington lawyer Tom O'Rourke is scheduled to talk about the next step in the $1 billion lump-sum pension tax refund case. This week the U.S. Claims Court upheld the government's right to tax those payments.