GOP weighs undoing vet pension cuts as debt price
WASHINGTON — House Republican leaders were considering a plan Monday to reverse a recently passed cut to military pensions as the price for increasing the government’s borrowing cap.
House Republican aides said party leaders planned to float the idea to rank-and-file GOP lawmakers at a meeting in the Capitol on Monday evening. The aides spoke on condition of anonymity because they were not authorized to be identified by name discussing strategy.
It’s not clear that the plan will fly with Democrats. Their votes would be needed to help pass the measure since some Republicans refuse to vote to raise the debt ceiling under any circumstances. A spokesman for House Minority Leader Nancy Pelosi, D-Calif., said Democrats will continue to insist that any debt limit legislation omit add-ons, even bipartisan proposals like repealing military pension cuts.
The cuts to cost-of-living pension increases for military retirees under the age of 62 were part of December’s budget agreement, backed by House Budget Committee Chairman Paul Ryan, R-Wis.
The reduction has sparked an uproar among advocates for veterans, and lawmakers in both parties want to repeal it. The 10-year, $6 billion cost of canceling the cut would be borne by extending for an additional year a 2 percentage point cut to Medicare reimbursements to doctors and hospitals, as well as cuts to a handful of other benefit programs. Those cuts, known as sequestration, would now extend through 2024.
Time is running out for lawmakers to act to lift the debt limit. Treasury Secretary Jacob Lew told lawmakers last week that the Treasury will exhaust by Feb. 27 its ability to employ accounting maneuvers to borrow to pay its bills.
Lew told congressional leaders on Monday that he had begun tapping two large government worker retirement funds to clear room under the debt limit. The action involving the Civil Service Retirement and Disability Fund will provide $50 billion to $75 billion in additional borrowing room while tapping the Government Securities Investment Fund will provide about $175 billion in borrowing room, Lew estimated.
Once Congress approves a new debt ceiling, the Treasury makes the funds whole by replacing the withdrawn funds and lost interest earnings.