Calm Before The Storm

The good news-bad news is that Congress is gone. Left town. Away until after Labor Day. For D.C. that is mostly good, especially if you are a commuter, user of the Beltway or like to eat out without waiting in line.

In addition to the 535 members of the House and Senate, tens of thousands of congressional staffers and lawyers and lobbyists who monitor Capitol Hill will also head for the shore, mountains or some place to rest and relax. Add to those numbers the thousands of area school busses that aren’t on the road.

It’s hot here. But that happens in summer. It is even hotter in places like St. Louis and Louisville and Cincinnati, and stickier in Houston and New Orleans. Bottom line is that for lots of people August is a treat.

So the good news is Congress and friends are out-of-town.

The bad news is that they will return.

As a fed-watcher lobbyist said, “August is also the calm before the storm, especially this year.”

She said that imminent threats to pay and benefits have taken a back seat until after Labor Day. Then we’ll see if the full House and Senate agree to a leadership plan to keep the government running until next March. The continuing resolution (CR) permits agencies to operate at current levels if their fiscal year 2013 budgets haven’t been approved by Oct. 1. Most haven’t.

The new fiscal year begins in October and the House has approved only seven appropriations bills. The Senate hasn’t cleared any and the White House has threatened to veto six of those okayed by the House unless changes are made. Worst-case scenario: It could be furloughs and/or layoffs for some feds.

Meantime, across-the-board, government-wide sequestration cuts are due to begin in early January, unless the House and Senate ratify the CR when they get back from their current break.

Assuming the CR is approved (which most people do), Congress then may or may not tackle other spending cuts including a number aimed at feds and retirees.

Groups and unions representing feds and retirees say their people have taken more than their share of hits. The cite the 2-year pay freeze as exhibit No. 1. But Congress may not see it that way. Several deficit-reduction or budget plans call for an extension of the freeze for at least another year.

Topping the list of things Congress might consider after Labor Day:

  • Raising the percentage that federal/postal workers contribute to their retirement fund. This is almost a done deal because the White House has proposed a 1.2 percent hike while differing House proposals would raise it anywhere from 1.5 percent to as much as 5 percent. Any change would produce a permanent decrease in take-home pay for civil servants.
  • Eliminate the Social Security supplement for early retirees under the FERS retirement program. Currently those retiring before they are eligible for Social Security benefits get a cash supplemental payment from the government to make up the difference. Depending on the age of the retiree that supplement could be worth tens of thousands of dollars.
  • Congress and the White House have already raised retirement contributions for new feds hired after Dec. 31 of this year. For those new people (all under the FERS system) their contribution will go from 0.8 percent to 3.1 percent of their salary. Current feds hope the budget-cutters will be happy with those future cuts, but in a political year, anything could happen. And frequently does.

Enjoy the rest of the summer and relax. Just not too much!


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