walkitout (walkitout) wrote,
walkitout
walkitout

weird claim that I believe to be false: link fu to follow

I first ran across the claim in the US form, where it is absolutely false: the claim is something along the lines of Senators are paid their salary for life. IT IS NOT TRUE. They qualify for Social Security in the usual manner, and there is also a pension, altho there were some changes in how this worked in the 1980s.

http://www.senate.gov/reference/common/faq/retirement_for_members.shtml

which refers to a report that includes this paragraph:

"There were 617 retired Members of Congress receiving federal pensions based fully or in part on their congressional service as of October 1, 2013. Of this number, 367 had retired under CSRS and 250 had retired under FERS. Members who had retired under CSRS had completed, on average, 22.9 years of civilian federal service. Their average annual CSRS annuity in 2013 was $71,664. Those who had retired under FERS had completed, on average, 16.2 years of civilian federal service. Their average retirement annuity in 2013 (not including Social Security) was $42,048. The average age of retired Members of Congress receiving retirement annuities in 2013 was 74 for those who had retired under CSRS and 71 for those who had retired under FERS."

Here's wikipedia on compensation for currently serving members:

http://en.wikipedia.org/wiki/Salaries_of_members_of_the_United_States_Congress

Basically, $174,000. Unless you are special, like the Speaker or Majority or Minority Leader.

So the average CSRS annuity in 2013 was under half the current serving salary (altho obvs, the salary in the past was lower see the wikipedia table at the link above, but then again, inflation adjustment blah blah bleeping blah).

Yesterday, I heard a similar claim about Italian members of Parliament. Because I knew it was not true in the United States, I wondered if it was true in Italy -- or, really, somewhere else.

Italian members of Parliament serve a long time and enjoy a regular increase in pay associated with length of service which has led to them being extremely highly paid compared to their country's GDP, compared to other members of the European Union. Partly this is because of length of service; partly this is because the country has a whole has stagnated so when salaries rise but GDP doesn't, the comparison gets more and more out of whack.

Here is a summary of parliamentary compensation across Europe.

http://news.bbc.co.uk/2/hi/uk_news/politics/7961849.stm

Here is France's "severance" arrangement: "If an MP fails to find employment after losing their seat, he/she receives a full salary for the first six months, then a gradually declining proportion of the salary for a further two-and-a-half years."

According to this, Italy has more Senators than many other countries, per capita population.

UK MPS have a "resettlement allowance" when they are out of a job: "MPs who lose their seat or stand down at a general election are also entitled to a "resettlement allowance" worth between 50% and 100% of their annual salary." It doesn't say for how long; I assume a one time payment unless I find out otherwise?

For the Euro parliament, there is compensation apparently identical to home country parliament, but then also compensation from the European Union, including a second pension scheme: "Basic pension arrangements for MEPs and MPs are the same, but MEPs can also choose to contribute to an additional, and very generous, European Parliament pension scheme."

None of these descriptions capture things like summer camp programs for children of members, which I have heard of in the past but am now sort of wondering about. You can go read the article to learn about travel benefits, per diem, second home costs, staff, etc.

Here is some about Italian state pension:

http://euracs.eu/summaries/italy-pension-summary/

I can make absolutely no sense of it. There aren't actually any private pensions to speak of, so you can safely ignore that because it's fictional. By serving a term in Parliament, Italian members apparently get the "full" state pension, without having to satisfy the complex and not-too-long-ago adjusted requirements in years of work. Again, paid full salary is _NOT TRUE_.

I'm not actually at all sure _why_ there is a persistent belief that elected officials in various countries are paid their full salary for life. The belief seems to be independent of age (I've run across it in people who are in their 30s and obviously the sky's the limit for buying into this particular belief) and political party and equally crosses language barriers and country borders.

But then, people believed all kinds of screwy stuff about their destination when they were arduously making the trek to the New World. I guess I shouldn't be surprised.

While I do not _like_ to link to the National Journal, I am going to do so Just This Once:

http://www.nationaljournal.com/magazine/nearly-one-in-five-members-of-congress-gets-paid-twice-20130627

It details how many Members of Congress had previous careers in state legislatures that were lengthy enough to qualify for retirement pay from their _state_ while serving the _federal_ government, thus qualifying, when they ultimately fail to win election anywhere (or choosing to opt out) for at least two pensions possibly on top of Social Security and/or military pensions as well.

I was well aware of people who plan careers based on assembling a double pension package at a comparatively early age. The people I am most familiar with doing this are those who start in the military, then serve as police officers. I in no way begrudge them what they have earned, altho, generically, I wince at things like Rhode Island having trouble funding education because they were overly generous with police pensions that had youthful retirement ages, rules set in an era of heavy smoking which has come to an end and now retired cops live much longer, having kicked the smoking (yay!) and with better medications for managing high blood pressure and so forth. It's a little weird to suggest that people who have served the 20 required for one pension and 20 for another to be required to choose either or, when others who only worked one 20 still get that one pension. It would be more fair to just length or combine the schemes and length the overall required period of service.

Most of these problems, however, can ultimately be laid at the door of price stability/disinflation. Public sector unions were successful and often continue to be successful at mandating annual or every other year step raises in the low percents. Back In the Day, these were not enough to keep up with inflation and were in conjunction with COLA steps that, nowadays, are often frozen at 0%. But a low percents step raise today is actually more than enough to get ahead of inflation, especially in the post-bust years. Combined with similar ratcheting features in pensions, and big changes in life expectancy post-smoking, we're all in a world of hurt. And so it is tempting to cartoonify the problem and believe that all these porkers are getting their full salary.

They aren't. Really.

However, as long as we're _at_ that National Journal article, I would like to draw your attention to this, about Trey "Benghazi" Gowdy.

"Take the curious case of Rep. Trey Gowdy. The conservative Republican served for a decade as a district attorney in South Carolina, where the retirement system requires 24 years of service to qualify for a pension. But a controversial perk allows solicitors and judges to purchase extra years of service without actually working them. The practice, called “airtime,” lets employees draw bigger pensions if they fork over a lump sum on the front end.

It appears Gowdy exercised this option. (His office refused multiple requests to clarify his activity.) His financial records report a loan in 2009 of between $250,000 and $500,000 for “purchase of SC solicitors and judges retirement.” So, in 2011, the year after he rode the tea-party wave into Congress promising to slash government spending, he reported $88,432 in pension income—one of the 10 largest in Congress. He was 46.

Last year, Gowdy reported a far smaller pension. His spokesman, Nicholas Spencer, says Gowdy listed the package in a different section of the report “because pensions are not reportable as outside earned income,” citing advice from “Ethics counsel.” The House Ethics panel’s published guidelines, however, say pensions should be reported as income."

So the next time you hear Trey Gowdy saying Hilary Clinton should not have been using her own email system while she was at State (which apparently was within the rules), contemplate his income reporting and retirement system choices.
Tags: politics
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