Since it was first projected in 1999, government-watchers have been anticipating a massive brain-drain, a retirement tsunami that would strip the government of its best and brightest, dumbing down many federal agencies.
Fighting the brain drain spawned a cottage industry of experts who discussed the dangers with the media and advised government agencies how to recruit, mentor or retain people until competent replacements could be hired or trained.
Also over the past decade, federal workers have worried about, and their unions and associations have fought, congressional plans and proposals to reduce future pension benefits and cost-of-living adjustments and force workers to pay a larger share of their retirement and health premiums.
But the tsunami didn’t happen, and one major hit feds did take (a two-year pay freeze) was ordered by the White House. But that was then, this is now…
Now, better-late-than-never, the tsunami seems to have arrived. Data compiled by the Office of Personnel Management shows that retirement applications (and a resulting backlog) jumped dramatically last year. After hanging on long past their retirement-eligibility date, people are now putting in their papers at near record rates.
Last year, feds sweated the White House-appointed Simpson-Bowles commission; joint House-Senate panels, an administration/congressional group chaired by the Vice President and various House GOP moves to whack federal benefit programs. None of them happened. They all fizzled.
But this time, as Bullwinkle says to Rocky, for sure.
With all of the past threats to federal benefits — switching from the high-three to the high-five, a new formula to calculate and produce lower retiree COLAs, raising employees’ share of health premiums costs — the most-likely-to-succeed is the House plan to increase employee contributions to the CSRS and FERS pension plan.
The reason it stands a good chance is that the administration also wants feds to finance a bigger share of their defined-benefit annuity. Congress wants a phased-in 5 percent increase. The White House has proposed a phased in 1.2 percent hike in employee contributions. So it isn’t an either/or option. It is what figure — 2 percent, 3 percent — will the White House and Congress set as a compromise?
Some experts believe the jump in retirement applications is the result of the pay freeze. Others say it is fear that the benefits formula will be changed, based on the employees highest five-year average salary. Others attribute it to thousands of buyouts offered last year, early this year, and those that will be offered when the new budget year starts Oct. 1.
One worker who contacted us said it is both simpler and more complex than just a number. She said many of her baby-boomer colleagues are suffering from the civil service version of PTSD. She said feds have become material for late-night comics. “We are sick of being told, by various politicians, that we are underworked and overpaid. A lot of us, including yours truly, want out.”
And it’s not just members of Congress and TV comics who are having fun at the expense of some feds.
At the black-tie White House Correspondents Dinner Saturday night, President Obama noted the beautiful decorations, gowns and meal and said: “I was just relieved to learn this was not a GSA conference. Unbelievable. Not even the mind reader knew what they were thinking.”
Later on, he noted how things change. He said that four years ago, “I was locked in a brutal primary battle with Hillary Clinton. Four years later, she won’t stop drunk-texting me from Cartagena.”
Between 1886 and 1959, the price of a 6.5 oz bottle of Coca-Cola stayed constant — 5 cents. Economists, who studied the phenomenon, called that a clear example of “nominal price rigidity,” where despite “substantial changes in the soft drink industry as well as two World Wars, the Great Depression and numerous regulatory inventions and lawsuits ….the nickel price of Coke, nevertheless, remained unchanged.” (per Improbable Research). At least one reason why the price remained constant was because of the company’s heavy investment in vending machines with nickel-only capability.
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