Pension worries are a growing issue for workers nationwide. Many states, counties and cities want to slash costs and are seeking to reduce government pension benefits. At the federal level, a process called “sequestration” is set to reduce spending in the name of “small government,” an approach that could slash VA benefits unless modified and monitored.
Speaking in Reno this week before the Veterans of Foreign Wars, President Barack Obama came out strongly against reduced benefits for vets and their families and re-affirmed a special allocation of funds.
“My administration has made it clear,” said the President. “Your veteran’s benefits are exempt from sequestration. They are exempt. And because advance appropriations is now the law of the land, veterans’ health care is protected from the budget battles in Washington.”
But are worries about VA benefits real — or just a political ploy? Will VA loans disappear or just get more expensive? Will funds for school and medical assistance which are protected today be vulnerable tomorrow? The answer is that threats to reduce VA benefits should be taken very seriously.
Across the country, pension benefits, which once seemed certain, are now vulnerable. Downsizing, mergers, bankruptcies, selective hiring practices and outsourcing can all lead to reduced pension costs and smaller benefit packages. Meanwhile, corporate profits reached a record $1.68 trillion in the last quarter of 2011.
While companies pay big dividends and massive executive salaries, pension accounts are being short changed. The S&P Dow Jones Indices has just reported that S&P 500 companies have retirement obligations of $1.96 trillion but are under-funded by $578 billion, an increase of more than $100 billion just in 2011.
Meanwhile, if it’s any comfort, the federal agency which insures pensions — the Pension Guarantee Benefit Corporation — has assets of just $79 billion.
Veterans groups are right to keep the issue of VA benefits on the front burner. To paraphrase Thomas Jefferson, the price of veterans benefits is eternal vigilance.