AFGE on 2013 COLA: It Could Have Been Worse

By on October 16, 2012 in Current Events, Pay & Benefits, Retirement with 14 Comments

By now, FedSmith.com users have seen the news about the COLA in 2013 being 1.7%. Social Security officially made the announcement today, but we had predicted in an article last week that it would be in the range of 1.5% to 1.7%.

AFGE president J. David Cox Sr. released a statement today on the announcement of the 1.7% COLA that will be given to federal retirees and Social Security recipients. Ever the optimist, Cox said, “It could have been much worse.”

Cox’s full statement reads:

While next year’s COLA is much smaller than the increase federal retirees and Social Security recipients received at the beginning of this year, it could have been much worse. Under the deficit reduction plan proposed by Morgan Stanley Director Erskine Bowles and ex-Senator Alan Simpson, the annual COLA would be cut by three-tenths of a percentage point.

So if Bowles-Simpson were in effect today, retirees would be getting a 1.4% adjustment in January instead of the 1.7% increase. Although a 0.3% cut doesn’t sound like much, it adds up over time. Over 10 years, that 0.3% difference would mean a 3% cut in benefits. Over 20 years, the loss in benefits rises to 6%.

This cut in COLA benefits is just one of many outrageous and indefensible ways in which Bowles and Simpson proposed to cut the nation’s deficit by slashing wages and benefits of working class Americans. Any attempts to revive their fatally flawed recommendations must be vigorously rejected.

© 2016 Ian Smith. All rights reserved. This article may not be reproduced without express written consent from Ian Smith.

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Ian Smith is one of the co-founders of FedSmith.com. He enjoys writing about current topics that affect the federal workforce. Ian also has a background in web development and does the technical work for the FedSmith.com web site and its sibling sites.

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  1. Badboy says:

    On a personal level, like any other federal annuitant, I do not relish lower COLAs under Simpson Bowles, or possible similar programs in the future.  I also recognize that, as a federal retiree, I have a deal that is notably better than most Americans.  The reality of our fiscal future is that, if unchecked, federal spending will lead to systemic failure at some point.  The modest reduction Simpson Bowles prescribes is, in my opinion, about the least we can expect. Cutbacks will be difficult for all Americans, and federal retirees cannot reasonably expect to be left out of the equation.

  2. Olaf Gunderson says:

    AFGE has no credibility and anyone who belongs to these union thugs who constantly throw their support behind Obama needs a wake up call.  Obama was the FIRST President to get away with not allowing a parity increase administrative pay adjustment with the military in 2009 followed by 2 years of pay freeze so that we Feds could all pitch in for the financial health of the country.  All the while, this congress and president together still, without a budget, without any cash awards or travel for Feds, or pay adjustments, spent more than $1 trillion more than they took in every year.  Anyone who buys this bull that they are holding the line on Federal spending needs their head examined.  I for one will not ever give Obama anything resembling a vote ever.

  3. Msgrowan says:

    Mr. Cox is in a state of serious denial.  The Simspson-Bowles commission, chartered by President Obama, made serious recommendations proposing painful but necessary measures to deal with the unsustainable spending levels that are driving us ever more inexorably in the feckless direction of Europe.  Entitlement programs’ costs growth alone, especially involving Social Security and Medicare, as ever more and more of the Boomer generation reach age eligibility, will rapidly force cuts in every discretionary spending area, while annual deficits will cotinue to explode notwithstanding such cuts.  This is the simple truth, and is backed up by studies conducted by the GAO and CBO.  It is notable that Mr. Cox ignores such unpalatable facts and is reduced to venomous scurrility, which illustrates only his intellectual vacuity on such matters.   We cannot begin to craft solutions to these daunting fiscal problems without a clear cut consensus by all major stakeholders that a crisis exists in the first place.  Mr. Cox appears to be a nonparticipant in this essential consensus.

    • Rmikelevy says:

      So where were you when George W. broke out the limitless credit card? Simpson-Bowles made recommendations. Many were taken seriously and moderated by the anticipated negative effects that would ensue. This is not “serious” denial as you claim. A strong economy comes from the production of goods and services, but that is stimulated by an ability to purchase those goods and services. In other words, businesses do not create jobs; customers do. When the people have more buying power, businesses need to hire to accomodate the increase in demand.

      • Fed Peasant says:

        I agree!!  Very little is said about the multiple wars that began under “W” Bush & continue under Obama. Romney is indicating that he will send US troops into Syria, if elected.  Wars drain treasuries quickly.  Especially multiple wars & stupid wars.  When the time comes to REALLY defend the US, the military is worn ourt & the treasury busted!!  Maybe the US should go broke.  There will be fewer wars that way!!

        • HRGuy71 says:

          Must be reading too many talking points and not enough specific facts.  He has not said he would send troops into Syria although it is probable that is how the Obama campaign prefers to describe his position in order to try to gain more votes. CNN, hardly a conservative news source wrote:
          “In specific policy examples, Romney called for the United States to join allies in ensuring that rebels fighting government forces loyal to Syrian President Bashar al-Assad get the military hardware they seek. However, he stopped short of calls by some conservatives for Washington to directly arm the rebels.”In Syria, I will work with our partners to identify and organize those members of the opposition who share our values and ensure they obtain the arms they need to defeat Assad’s tanks, helicopters, and fighter jets,” Romney said.

          • Fed Peasant says:

            Romney is a draft dodger!!  He avoided military service in Vietnam.  I have a problem with that!!  Multilple sources had him declaring the use of US troops to secure chemical weapons in Syria.  I watch more Fox news than CNN.  I also read foreign news outlets frequently.  Here is another republican “chicken hawk”!! 

          • DON_Supervisor says:

            How many years did 0bama serve in the military?

        • Retired Fed says:

          I’ve got a better plan than to send troops into Syria.  Let’s figure out how much that war would cost us and invest that money into developing new sources of energy that are not foreign.  Can you imagine what state of energy independence we would be in if we had done that since the Oil Embargoes of the 1970’s?  We could say to the Arabs “We don’t need your stinking oil!”  and “We don’t care what is going on in your part of the world.”   But no, we wasted so much time and trillions of dollars.

      • Olaf Gunderson says:

        Hahahaha… we always come back to blaming George W. Bush.  Probelm is Mike, we did better under Bush than we ever have under Osama , I mean Obama, I mean Hussein Osama Obama

      • msgrowan says:

        Bush vastly expanded Federal spending, including establishment of the costly Medicare Part D program, against which I protested at the time.  Regarding the Simpson-Bowles commision’s recommendations, they were given lip service only by both parties, fearing voter wrath at the polls if they actually pursued such pain-inducing suggestions.  No argument about the need for a strong economy - which, of course, is what we don’t have at present - but that assertion does nothing to deal substantively with the cold, hard facts that our mounting fiscal deficits – exacerbated as they already are and will be further by burgeoning entitlement program costs – will inevitably hobble our chances of again attaining a robust economy.   Neither party has put forward a set of credible proposals to deal with this unfolding fiasco.  True leadership is desperately needed in this regard but is essentially nil from our current political “leaders” in both parties.

    • Fed Peasant says:

      That is his job.

  4. bigbob says:

    I bet congress votes itself a raise that is more than 1.7%!

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