A year ago at this time anybody predicting that federal pay would be frozen for one year would have been considered an every-silver-lining-has-a-cloud pessimist. But thanks to the economy and changing political considerations the White House proposed a two year freeze and the lame duck Congress was delighted to okay it. Some feds breathed a sigh of relief because the bipartisan deficit reduction commission setup by the President had called for a 3-year freeze. So two, in the weird world of Washington politics and compromise, seemed like a good deal. Lesson:

Things can, and do, change fast.

Today anybody who says the current federal pay freeze will last ONLY two years might qualify for the cockeyed optimist award.

And unless inflation takes off (triggered most likely by skyrocketing oil costs) it is entirely possible that the 2012 COLA for federal , military and Social Security retirees will be little, or nothing. The size of the 2012 inflation-catchup will be determined based in living cost data that will be available in October of this year.

House Republicans are pressing for major cuts in government ranging from a 3 or 5-year federal pay freeze to downsizing-by-attrition, a 10-day furlough for nonemergency feds and, probably, a proposal to cut future federal retirement benefits by basing them on the employees highest 5-year average salary. Right now both CSRS and FERS annuities are figured on the employees’ high-3.

Now, in addition to those proposed House cuts, the president’s budget (for the fiscal year that begins in October) calls for major cuts in some agencies and programs, and a hold-the-line approach for the next 5 years in most other operations.

To add insult to injury and further complicate things, federal agencies are still operating under a continuing resolution. Last year’s lame duck Congress (again) failed to approve budgets or appropriations last year. In addition to other problems associated with operating under a CR causes agencies, and contractors problems. Some agencies have been forced already to freeze hiring.

The current CR expires March 4. Congress and the White House (as they have repeatedly) can extend the CR. But if they decide to play political chicken a worse-case scenario would be a government-wide shutdown.

Because of the spending limits of the CR , an IRS employee complains “we don’t even have copy paper” in her office.

A Defense contractor said he had been supporting missile defense for the past 20 years. But recently he was laid off and said he can’t find another job because of the uncertainty private contractors face because of the uncertainty within DoD because of the CR.

So what’s the deal with you? What’s the impact on your agency? What’s the impact on retired feds? And what would you do if Congress and the White House change the benefit package and/or extend the freeze beyond two years?

To reach me: mcausey@federalnewsradio.com

Nearly Useless Factoid
by Suzanne Kubota

From Shine on Yahoo!, “Women are, in fact, colder than men.”

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