Mike Causey

A COLA Without Any Fizz?

Just because the cost of living is going up again doesn\'t mean federal and military retirees will get a COLA increase in January. To find out what\'s going on ...

Federal News Network Staff

February 26, 2009 4:00 am

2 min read

Living costs jumped slightly last month, after five consecutive monthly declines in inflation as measured by the Labor Department’s Consumer Price index.

That’s a very interesting point for millions of federal, military and Social Security retirees and for still-working feds thinking about pulling the plug this year. Reason:

An increase in the CPI-W over a 12-month period can, and does, automatically trigger a January cost of living adjustment for retirees lucky enough to be linked to that system. Most Americans who get pensions from their private sector work don’t—ever—get inflation adjustments.

But even with the January rise in the CPI, living costs are still 4.5 percent lower than they were last year when the January 2009 raise was triggered. That increase of 5.8 percent was the biggest retirees have had since 1982. And while it came after months of oil-driven increases in overall living costs, deflation then took over for the rest of the year.

COLAs for federal-military-social security retirees are based on the rise in the CPI from the third quarter ,July, August and September, of this year over the previous year’s third quarter. Unless living costs jump more than 4.5 percent between now and September, the retirees won’t get a COLA in 2009. That’s the bad news.

The good news for the retirees is that their benefits won’t be reduced even if living costs remain unchanged, or decline even more. For more on how that works, click here.

Get Out Of Jail Card

Just before he left office, President Bush quietly commuted the prison terms of two former border patrol officers. They were serving terms of 11 and 12 years for shooting someone they were pursuing as a suspected drug runner. The case got national press coverage in part because of alleged government plot against the two officers and charges that the men, Ignacio Ramos and Jose’ Compean were anti-Mexican. The man they shot was a Mexican national.

Sources in the law enforcement community said the plea for a pardon for the two ex-agents was hand-delivered to President Bush by former New York City mayor ,and later presidential candidate, Rudy Giuliani. They will serve out the remainder of their prison terms under house arrest. For more on that story, click here.

About Those $250 Payments

Wednesday’s column dealt with the stimulus plan to give millions of retirees one time payments of $250, and (maybe) give retirees who have taken other jobs a one-time 2009 tax credit of $250. Jill Crissman from the National Active and Retired Federal Employees was our guest yesterday on our Your Turn radio show. The show is on every Wednesday at 10 a.m. EST. It’s been archived on our home page so you can listen to her explanation of how the program worked. Also, tomorrow, we’ll have Jill’s rundown on how the payment program may effect you.

Nearly Useless Factoid

According to Amusingfacts.com, our first president, George Washington, had to borrow money in order to make it to his inauguration. We’ve come a long way.

To reach me: mcausey@federalnewsradio.com