View Full Version : Proposed pay raise fails to please Democrats, VFW

02-21-06, 11:06 AM
Proposed pay raise fails to please Democrats, VFW
Inflation outpaces 2.2 percent increase

By Rick Maze
Times staff writer

The 2.2 percent military pay raise proposed for 2007 by the Bush administration may be competitive with salary increases in the private sector, but it would represent the second consecutive year of reduced buying power for troops and their families.

The failure of military pay to keep pace with inflation already is garnering attention.

Senate Democrats began a push to set aside money for a bigger pay hike in a Feb. 16 letter to the Senate Budget Committee.

“Our troops are sacrificing so much,” wrote Sen. John Kerry, D-Mass., who organized the letter signed by nine other Democrats. “Getting our troops the pay raise they deserve is the very least we can do to show how much we value everything they do for us.”

The letter does not ask for a specific percentage raise but says: “Surely they deserve a raise of more than 2.2 percent.”

Jim Mueller, a Vietnam veteran and commander in chief of the Veterans of Foreign Wars, said the proposed raise is insulting to service members and might cause some to get out. “A record budget that focuses more on modernization than people is forgetting that it is people who make the military run,” Mueller said.

In addition to the 2.2 percent pay raise proposed for next January, the administration may ask for additional increases for a limited number of paygrades to take effect midyear.

That would bring the average military raise for 2007 to 2.4 percent. However, government economists predict inflation will be 2.8 percent this year, which would make 2007 the second year in a row in which the military pay hike did not match the inflation rate.

Inflation for last year, as measured by the Consumer Price Index of the cost of goods and services, jumped 4.1 percent, largely because of increases in crude oil prices that led to consumer price hikes in transportation and heating costs. The Jan. 1 hike in basic pay was 3.1 percent.

Senate Democrats’ House colleagues “are very disturbed” by the signal that the raise sends to the troops, said a Democratic aide who asked not to be identified.

“The problem is that there are a lot of things about the 2007 budget that disturb us, and there won’t be enough money to fix them all,” the aide said.

Typically, the House Armed Services Committee finds about $1 billion to spend on personnel-related expenses not included in the Pentagon’s annual budget request. But each percentage point increase in military pay costs about $600 million.

Two consecutive years of reduced purchasing power would eat into the huge military pay gains made in recent years. Between 1999 and 2005, annual military pay increases outpaced inflation by 18 percent. The gap between average military and private-sector wages was slowly shrank between 1999 and 2005, and is about 4.4 percent today, down from its peak of 13.5 percent in 1999.

Service members did so well during that time because Congress created a formula that set annual military raises at least 0.5 percentage point above wage growth in the private sector to slowly trim the so-called pay gap.

More important, the Pentagon won approval for a series of huge, targeted pay raises over the same period, aimed mainly at midgrade and senior enlisted members and warrant officers, that significantly enhanced average military raises.

The formula that set military raises 0.5 percentage point above private-sector wage growth expired with the 2006 pay raise that took effect Jan. 1.

But lawmakers have left future active-duty pay increases tied to the same gauge used under that formula — the Employment Cost Index, a measure of private-sector salaries maintained by the Labor Department.Mueller, noting that the proposed 2.2 percent raise would be the smallest since 1994, said the government needs to do better for service members.

“Less than half of 1 percent of our population is now responsible for safeguarding every freedom that 300 million Americans enjoy today,” he said. “They serve under extremely dangerous and arduous conditions, endure extended family separations and forfeit some civil liberties.

“Our military deserves a pay raise greater than 2.2 percent.”