Air Force to Offer Larger Retention Bonuses, Much Like the Maximum $25,000 Stipend, and Double the Monthly Incentive Pay for Drone Operators — from $600 to $1,500 — to Persuade Them to Stay in the Air Force

Air Force to tap Guard, Reserve to fill drone pilot shortage

January 16, 2015

AP - The Air Force is taking several steps to fill a significant shortfall in drone pilots, laying out plans to increase incentive pay, bring more National Guard and Reserve pilots onto active duty, and seek volunteers to fill needed slots, Air Force Secretary Deborah Lee James said Thursday.

Calling them interim measures, James told reporters they may seek larger retention bonuses for drone pilots, much like the maximum $25,000 stipend that manned aircraft pilots can receive. While the Air Force has long struggled with a shortage of drone operators, the demands of ongoing operations around the world, including persistent airstrikes in Iraq and Syria, have exacerbated the problem.

Nearly 60,000 Veterans Were Triple Dippers in 2013, Drawing a Total of $3.5 Billion in Military Retirement Pay Plus Veterans and Social Security Disability Benefits

Report says 60,000 veterans get triple benefits

November 1, 2014

AP - Nearly 60,000 veterans were triple dippers last year, drawing a total of $3.5 billion in military retirement pay plus veterans and Social Security disability benefits at the same time, congressional auditors report.

The average payment was about $59,000, but about 2,300 veterans, or 4 percent of the total, received concurrent payments of $100,000 or more, the Government Accountability Office said. The highest payment was to a veteran who received $208,757 in combined payments in 2013.

Some lawmakers say the report shows the need for better coordination among government programs that are facing severe financial constraints. The Social Security Disability Insurance trust fund could run out of money in as soon as two years, government officials say.

"We should fulfill our promises to the men and women who serve, but we need to streamline these duplicative programs," said Sen. Tom Coburn, R-Okla., who requested the study.

Veterans groups disagree. They say the retirement money was earned for years of service in the military, while disability payments are compensation for service-related injuries and wounds.

In most cases, veterans who receive a combination of benefits are severely disabled. About 4 in 5 veterans who got triple payments had a disability rating of at least 50 percent, the GAO said. Nearly half of those receiving triple payments were at least 60 years old.

Louis Celli Jr., a Washington representative for the American Legion, said critics of the multiple benefits are "misguided and uninformed." He said the report "should simply be filed in the category of one of Sen. Coburn's parting shots to loyal upstanding American patriots who have sacrificed so much for this country."

Coburn, a longtime critic of government spending, is retiring at the end of the year. He said in an interview that the report raises legitimate questions about whether disability benefits are getting to those who truly need them.

"This is billions of dollars a year in duplicative payments," Coburn said. "We ought to reassess and say, 'Are we doing more than take care of people in need?' I'm not against the military. I don't think they should be triple dipping."

Most Americans would find it hard to understand how someone making $86,000 a year in tax-exempt VA income qualifies for Social Security Disability Insurance, when civilian workers are disqualified from the program if they make as little as $13,000 a year, Coburn said.

Only 17 percent of those who received multiple forms of compensation had suffered a combat-related disability, according to the GAO.

Veterans have long been exempted from rules that deny Social Security benefits to anyone with other income exceeding $13,000 a year.

But until the Sept. 11, 2001, terrorist attacks, veterans were barred from receiving both military retirement pay and Department of Veterans Affairs' disability benefits. Under a Civil War-era statute, the Pentagon docked retirement pay dollar-for-dollar up to the amount of disability benefits from the VA.

With bipartisan support, Congress changed that law in 2002, gradually restoring military retirement pay to veterans also drawing disability benefits from the VA.

"Our nation's status as the world's only superpower is largely due to the sacrifices our veterans made in the last century," Sen. Harry Reid, D-Nev., said in March 2002 when the bill was being debated.

"Rather than honoring their commitment and bravery by fulfilling our obligations, the federal government has chosen to perpetuate this longstanding injustice," Reid said. "Quite simply, this is disgraceful and we must correct it."

At the time, then-Sen. John Warner, R-Va., a former Navy secretary, posed a question to fellow senators:

"How can we ask the men and women who have so faithfully served to sacrifice a portion of their retirement because they are also receiving compensation for an injury suffered while serving their country?"

Warner acknowledged that the change would have "significant cost," but added;

"Is the cost too high? I think not."

About 3 percent of the nation's 1.9 million military retirees collect all three benefits, the GAO said.

The report did not recommend changes to the program. The VA said in a response that it "generally agrees" with the report's conclusions. Social Security officials did not comment.

Public Employees Retire at 55 with Nearly Full-salary Pensions and Heathcare Benefits

Many middle managers and executives, defined as assistant department directors and above, are retiring from their Phoenix, Arizona city jobs in their late 50s or early 60s to take other jobs, which often allows them to collect a sizable city pension while earning a salary and retirement benefits in their new post — a practice known as “double dipping.” A controversial example is former City Manager David Cavazos, 54, who retired in October 2013 after 27 years with the city. Cavazos collects a $234,500 annual pension from Phoenix while earning a $315,000 salary as city manager of Santa Ana, Calif. Former Phoenix Chief Financial Officer Jeff DeWitt, 52, who retired in December to become the chief financial officer for Washington, D.C. DeWitt said he would have stayed in Phoenix for several more years if the job hadn’t come knocking. He said the average age in Phoenix’s Finance Department was 50 when he left. Concerns about the impact of her early departure and those of her peers also weighed on former Planning and Development Director Debra Stark, 59, who retired in late 2012 to do a similar job for Maricopa County. [Source]

Civil servants, gather your pensions and gird for the War of 2014

November 14 2013

Konrad Yakabuski, The Globe and Mail - When I was entering the work force, a government job held no appeal. I considered the bureaucracy the place where creativity went to die, strangled by line managers obsessed with procedure over results. I cringed at the thought of winding up an organization man in Wallabees stuck in a cubicle in Tunney’s Pasture, the 1950s-era cluster of government buildings in Ottawa modelled on Cold War Warsaw.

I now realize I was just being young and impractical.

Friends and relatives who went to work for the federal government are among the happiest people I know: 

• They’ve had fulfilling, iron-clad jobs with lots of opportunity for advancement. (In Ottawese, they’ve moved from AS-3 to AS-8.) 
• Most retired in their 50s or plan to. 
• Some travel the world, start second careers or pad their pension income as government consultants or contract workers. 

Life has been blissful in the public sector autarky that is Ottawa.

So, why does Tony Clement want to ruin a good thing? The Treasury Board President, the minister who negotiates Ottawa’s labour contracts, is gearing up for a colossal confrontation with government unions.

The Harper government’s omnibus budget bill contains unprecedented measures that will tilt the collective bargaining process in Mr. Clement’s favour as he seeks to rollback perks (such as bankable sick days) and implement performance evaluations to ditch the deadwood.

And that’s just the beginning. At this month’s Conservative convention in Calgary, Mr. Clement was the most enthusiastic supporter of a resolution to bring public-sector compensation in line with private-sector remuneration. 

“For too long, there has been a major gap in wages and benefits between the public and private sector,” he insisted. “This is not sustainable, it’s not right, it’s not conservative and it’s not in the public interest.”

Such talk resonates with ordinary Canadians who can’t dream of pay and pensions on par with those of the workers who technically “serve” them. No matter that it will be harder for Mr. Clement to plead poverty given Finance Minister Jim Flaherty’s projection this week of a $25-billion federal budget surplus between 2015 and 2019. Or that, after cutting almost 20,000 jobs from the public service since 2010, many departments are grappling with staff shortages and higher workloads.

Overall, the federal public service is up by about 25,000 jobs since Stephen Harper took power in 2006. But in a telling reminder of Mr. Harper’s idea of the role of government, the expansion is entirely the result of massive hiring at the Canadian Border Services Agency, the Correctional Service of Canada, the RCMP and other law enforcement and spy agencies. The Conservative police state is thriving.

Former Privy Council clerk Mel Cappe recently warned that the federal public service is in “secular decline” because the Conservatives have no use for bright minds brimming with policy ideas.

“Ideology doesn’t need analysis,” he told the Ottawa Citizen last month, “and if you have the answers, you don’t need questions.”

There probably isn’t much sympathy for that view among average Canadians. Most see civil servants as spoiled children who have had it too good, for too long. Last year, some wore “Stephen Harper Hates Me” buttons to work, a stunt that struck many hard-working Canadians as unprofessional, if not infantile.

Besides, without a top-to-bottom overhaul of public-sector pensions, taxpayers are already on the hook for a $148-billion unfunded liability. That’s the official amount; the C.D. Howe Institute figures the true sum is $118-billion more because Ottawa has overstated future returns on pension investments.

Another resolution at the Conservative convention called for the government to switch its employees over to defined-contribution pension plans. Mr. Clement hasn’t gone that far yet, but he will have the entire Conservative base and much of the Canadian public onside as he pushes for big concessions in upcoming contract talks.

Canadians who have seen their pensions eroded, if they’re lucky enough to have them at all, are in no mood to grandfather the entitlements of civil servants who contributed comparatively little to their own retirement funds only to retire at 55 with nearly full-salary pensions. It’s not enough to raise the retirement age and contribution rate for new hires. Current federal employees and retirees may face benefit cuts, too.

Get ready for the War of 2014 and the Battle of Tunney’s Pasture.

Military Retirees May Lose Double Dip Retirement

August 5, 2013 

James Joyner, Outside the Beltway - The Pentagon is considering making military retirees ineligible for civil service pensions.

Federal Times (“An End To Civilian Pensions For Military Retirees?“):

To address long-term sequester cuts, the Defense Department is mulling numerous reductions that will affect civilian employees, including doing away with civilian employee pensions for military retirees who go back to work for the government as civilian employees.

The savings could be almost $100 billion over 10 years when combined with a halt to commissary subsidies and restrictions on the availability of unemployment benefits, Defense Secretary Chuck Hagel told reporters last week in summarizing the recommendations of the newly completed “Strategic Choices and Management Review.”

[...]

As of March, more than 134,000 military retirees held civilian jobs at DoD, according to the Office of Personnel Management. For the Pentagon, axing civilian pensions would save money by reducing the amount it has to contribute into the Federal Employees Retirement System and the Civil Service Retirement System, said Larry Korb, who oversaw manpower issues as an assistant Defense secretary during the Reagan administration.

While Korb does not take the idea seriously, he sees it as an attempt by DoD to draw attention to a pension program that often lets soldiers, sailors and airmen retire from the military after 20 years, then return to DoD as civilian employees making more money for doing the same job.

Hagel did not say how aggressively DoD would seek to implement such a step or how much it could save. A Pentagon spokesman later declined to provide additional detail.

But the head of the National Active and Retired Federal Employees Association (NARFE) blasted the idea as “ill-conceived and completely unfair.”

“No civilian employee should receive lower total compensation because they served in the military, ever,” NARFE President Joseph Beaudoin said in a statement. “This proposal should be rejected completely as an option, even under the worst budget scenarios.”

Once upon a time, military officers who retired at pay grade O-4 and above (major/lieutenant commander) were ineligible to be hired into the civil service unless they waived their pensions. We got rid of that restriction because it was not only unfair (essentially penalizing people for two decades of service) but stupid (depriving the government of proven, experienced leaders).

Regardless, there has always been a tension between military retirees and others in the civil service.

My dad was a retired senior NCO and thus not subject to the restriction but always felt like he was discriminated against. At least in those days (circa 1986) retirees were not eligible for the 5 point hiring preference given to ordinary veterans (such as myself) or the 10 point preference given to disabled veterans (such as him). Additionally, whereas military service time counted towards one’s time in government services for retirement, vacation, and other benefits if you were an ordinary veteran, it didn’t if you were drawing a retirement pension.

On the civilian side, though, the civil servants who had little or no military background resented former military coming in well into the grade structure and often having outsized influence because of their military experience and/or network. Additionally, there was an extra dose of resentment reserved for those drawing a generous military pension in addition to their civilian salary, especially from civil servants who had just as much service time.

Ultimately, though, the “double dip” argument was always silly. That one can put in twenty years of service in the military and retire with a nice pension is hardly a state secret. Nor is it particularly onerous to qualify to enter into that path, especially if you’re healthy. Nor is it obvious why it’s problematic for someone who is going to get a pension regardless of whether or where he works after “retirement” to be allowed to compete for vacancies in the civil service. Yes, they’re getting two paychecks from the government. But they’re going to get one regardless and only get the second because they’ve taken a second job.

There is, of course, the issue of cronyism. When a retiring colonel winds up being selected as the “best available candidate” for a civil service position that just so happens to have a job description which exactly matches his last active duty position, there’s a natural suspicion that the fix is in. But there are ways to minimize this problem–and it’s really tangential to cost savings.

The bottom line, though, is that there’s no legitimate argument to be had for denying a second pension to someone who legitimately earns his first pension in uniform and then legitimately earns a second one after twenty or twenty five more years of service in civvies. That’s especially true since, nowadays, the civil service retirement system amounts to a 401k rather than a military-style pension.

How to succeed in Japan -- Fall from Heaven Bureaucrats

June 30, 2014 

Ron Wiltbank - It seems strange and very different from the USA, but in Japan "fall from heaven" bureaucrats are very important. These are generally, Japanese government bureaucrats who leave the government in their 50s and "Fall" to a firm they previously regulated. 

After WWII, General MacArthur, did not like "fall from heaven" bureaucrats and tried to ban them. He felt since they fall to the former companies they regulated, they were too close to those companies when they were in office. He felt that they tried to protect the company profits so they would have a comfortable place to land when they left the government. 

After he banned the practice, the Japanese felt that their entire schooling, and work life had changed. They felt that there was no reason for top college graduates to join the government since they had no chance for gain. 

The government must answer to the voters, so they would not raise the salary of employees, so college graduates would NOT take low paying government jobs, if they did not have the potential to "fall from heaven" and take a cushy job at a commercial company for their retirement when they left government in their 50s.

Therefore, Japan modified the rules to say that government workers could "fall from heaven" to NON-profit companies for 10 years, then to a for Profit company after that. As you can imagine, the 10 years fell to 8, 6, 4, 2 and now they can fall directly to the companies they regulated. Back to the same as before the war. 

During the years when Non-profits were demanded, as you can imagine, thousands of NON-profit corporations were created so that companies could "get the expertise from government bureaucrats.

I lived in Japan during those years, so we, an American company even had one bureaucrat in a Non-profit company, but our competitors had more than 100 bureaucrats. As you can imagine, the government was not generally on our side. If we had a technological advantage in some area, such as over-the-air programming so that the wireless item did not need to be brought back in to us to be reprogrammed, but the Japanese did NOT have this technology, the technology was banned by the government. (Actual case)

Because of this close relationship with the government bureaucrats, if the companies they supervised were NOT profitable, they were extremely concerned. Mainly because then there would not be a cushy retirement for their government people. 

So government bureaucrats wanted to be heavily involved in all industries to make sure all industries were profitable. If there were no profits then they wanted to change the law to give you some advantage and make you profitable.

The saddest state was if technology changed and the old companies all went out of business. Then the government bureau would also go out of business and the employees would have no place to go. So at all costs, older industries must be given new technologies so their companies could grow and the bureaucrats would have somewhere to retire.

When the retired employees came to your company, they mainly wanted to communicate with the government. Therefore, there was no secret from the government.

For a company like Motorola, where I worked, this meant that the Japanese government would know what we were doing. At that time, we were close to the American government to take cellular phones and other wireless products to the Japanese consumers. In fact, KDDI, the cell phone operator, believed they owed their business to the American government opening the cellular phone market in Japan.

To win in Japan, it is good to have the government on your side, since they can regulate for you and keep you competitive. However, most foreign companies want to ignore the government, like they do at home. American firms in Japan need to be aware of the heavy government involvement, to have a chance to compete in Japan with the government's blessing.

Japanese bureaucrats descending from heaven

August 8, 2002

Asia Times - The latest attempt to shake up Japan's complacent bureaucracy probably will not stop the country's senior bureaucrats from using their positions to arrange comfortable post-retirement jobs any time soon.

Looking to fend off mounting public criticism that his government is defending a largely pampered and corrupt bureaucracy, Prime Minister Junichiro Koizumi urged his cabinet last month to draw up plans to reform the civil service. But few here believe the proposals are likely to amount to much.

Koizumi, who took control of the Liberal Democratic Party (LDP) to become prime minister in April last year, did so by promising to fight corruption and rot within the party and the state bureaucracy. High on his list of graft-busting objectives was to bring to an end the time-honored tradition of jobs for the boys.

In recent years a raft of criminal indictments of senior government bureaucrats on corruption charges have shattered decade-long perceptions that senior civil servants are enlightened selfless professionals bent on guarding the nation's prosperity.

In June the Daily Yomiuri reported that forestry officials in Hokkaido had turned a blind eye to illegal logging by Yamarin, a firm based in Japan's north, that was allowed to exceed its quota after putting former forestry officials on its payroll.

Referring to the company's illicit logging operations, the newspaper quoted a Yamarin spokesperson as saying, "It was a tacit agreement between us and the forestry authorities to give us special treatment in return for employing them."

As a result of these recent public disclosures, retiring bureaucrats have found that the once uncomplicated shift from senior government post to comfortable, well-paid executive desk job - the practice of amakudari (or "descent from heaven") - is becoming less socially acceptable.

The peculiar amakudari phenomenon owes its existence to the obsolete seniority system exercised in most Japanese governmental circles and is carried out at the expense of the merit system. This explains why high-ranking officials are encouraged to retire in their early 50s instead of the mandatory age of 60. However, the responsible ministries award them with a post-retirement employment offer at public corporations so that their departure will allow the promotion of their younger colleagues.

No wonder, note observers, that there is an obvious reluctance to privatize public corporations, since they guarantee top jobs to retiring government officials. In 2001, more than 540 former senior bureaucrats found themselves executive desk jobs with public corporations.

It is the rule of the old boys' fraternity: "You scratch my back, and I will scratch yours."

The bureaucrats' "voluntary" resignations represent a heavy burden for the state coffers. The retirement allowances for administrative vice ministers, for instance, vary between 70 million and 80 million yen (US$598,000-$684,000). In fiscal year 2000, retiring civil servants received 815.9 trillion yen (about $7 billion) in allowances.

Upon parachuting into their new careers, the amakudari can anticipate an annual salary of about 12 million yen ($103,000), while a few may even get twice as much. The justification for granting such high salaries to the incoming office holders is that they are unlikely to be attracted unless they can earn more than their previous positions. And since employers consider it essential to hire people with prestigious backgrounds, they find they have no choice but to accede to their terms.

Occasionally ex-bureaucrats leave their executive jobs within three years, after which they are entitled, depending on the corporations that employ them, to a retirement allowance of about 17 million yen ($145,000). They will then hop to a new high-paid post with the aim of accumulating additional retirement benefits.

"If an individual wishes to open a private school, the Ministry of Education will add on much red tape before granting permission. But should an amakudari official approach the ministry with a similar request, the go-ahead will be given promptly," said Kozo Kanno, 59, now retired. "This means that would-be amakudari could easily get a job in that particular school after retirement," Kanno said.

But such haughty conduct is prompting Koizumi, in words at least, to vow to terminate the practice of amakudari.

"We need immediate structural reforms to reduce the number of public corporations that have connections to particular ministries with responsibilities over construction, finance and health for example," said 28-year-old librarian Shinichi Nakajima. "The separation between business and government dealings lacks transparency, this should be changed."

One solution would consist of gradually increasing the retirement age for government officials to 60 years, while others suggest 65.

Koizumi is demanding that stricter regulations be applied to control the costly movement of ex-government officials. Since April, all retired bureaucrats who benefit from a substantial income from public corporations will begin to see their retirement allowances cut by up to 30 percent.

The government is also expected to enact a new system by which officials joining public corporations will be labeled "non-retiring civil servants", which would ensure that they receive retirement allowances only once.

Officials believe that if these steps are introduced successfully, retirement allowances could be easily halved. But others express doubts that real change will be accepted.

"The Japanese government is controlled by bureaucrats who make most of the decisions for it. It is therefore impossible to get immediate approval for any decision," said Kanno.

The practice of amakudari, whereby retired senior government officials land financially rewarding jobs with private corporations (or public firms) they formerly supervised, will take time to overturn as nobody in power wants to make the first move.

"Maybe it will be eliminated in 50 years, but certainly not in the next five years," said Robert Ballon, emeritus professor at Tokyo's Sophia University.

(Inter Press Service)

Veteran Disability Claims Reach Historic Highs with U.S. Encouragement

With US encouragement, VA disability claims rise sharply

July 17, 2014 

Los Angeles Times - As Malvin Espinosa prepared to retire from the Army in 2011, a Veterans Affairs counselor urged him to apply for disability pay. 

List all your medical problems, the counselor said.

Espinosa, a mechanic at Fort Lee in Virginia, had never considered himself disabled. But he did have ringing in his ears, sleep problems and aching joints. He also had bad memories of unloading a dead soldier from a helicopter in Afghanistan.

"Put it all down," he recalled the counselor saying.

Espinosa did, and as a result, he is getting a monthly disability check of $1,792, tax free, most likely for the rest of his life. The VA deems him 80 percent disabled due to sleep apnea, mild post-traumatic stress disorder, tinnitus and migraines.

The 41-year-old father of three collects a military pension along with disability pay _ and as a civilian has returned to the base, working full-time training mechanics. His total income of slightly more than $70,000 a year is about 20 percent higher than his active-duty pay.

Similar stories are playing out across the VA.

With the government encouraging veterans to apply, enrollment in the system climbed from 2.3 million to 3.7 million over the last 12 years.

The growth comes even as the deaths of older former service members have sharply reduced the veteran population. Annual disability payments have more than doubled to $49 billion _ nearly as much as the VA spends on medical care.

More than 875,000 veterans of the Afghanistan and Iraq wars have joined the disability rolls so far. That's 43 percent of those who served _ a far higher percentage than for any previous U.S. conflict, including World War II and Vietnam, which had significantly higher rates of combat wounds.

Disabled veterans of the recent wars have an average of 6.3 medical conditions each, also higher than other conflicts.

Incentives to seek disability ratings have increased due to changes in VA policy, including expanded eligibility for post-traumatic stress disorder and a number of afflictions that affect tens of millions of civilians.

Nearly any ailment that originated during service or was aggravated by it _ from sports injuries to shrapnel wounds _ is covered under the rationale that the military is a 24/7 job.

The disability system was unprepared for the massive influx of claims, leading to backlogs of veterans waiting months or longer to start receiving their checks.

But once the payments begin, many veterans say, they are a life-saver.

Ray Lopez struggled to keep a steady job after leaving the Marines in 2001. Stints as a TSA screener, insurance agent and soft drink salesman ended badly.

At 35, Lopez is rated 70 percent disabled for back, shoulder and knee pain, as well as post-traumatic stress disorder from having witnessed a deadly helicopter crash off the coast of San Diego.

He couldn't support his wife and two children, he said, without the monthly $1,800 disability check.

"If it wasn't for that, I'd be on the streets," he said.

Lopez trains boxers three days a week and is pursuing a community college degree.
___

The generosity of veterans benefits is on an upswing in a pendulum arc as old as the republic.

During the Revolutionary War, disability payments were limited to soldiers who lost limbs or suffered other serious wounds.

Lobbying by Civil War veterans led to coverage that included peacetime injuries and illnesses.

After World War I, compensation was scaled back to cover only combat injuries and diseases contracted in war. But World War II brought an expansion to include all conditions that appeared during service or shortly afterward.

In the 1950s, President Dwight Eisenhower _ a former five-star general _ tried to rein in the costs. He found little support in Congress, and the basic system has remained the same ever since.

The VA uses a formula that combines a veteran's conditions into a rating of between 0 percent and 100 percent _ in 10 percent increments. The higher the rating, the larger the disability payment.

Nearly half of those in the system have ratings of 30 percent or below. They can apply for higher ratings if ailments grow worse.

"The disability system has this escalator quality," said David Autor, an economist at MIT. "Once you get on, you just keep going up."

The current benefits boom began with a political battle over Agent Orange and other herbicides used to clear jungle brush in Vietnam.

In 1991, Congress and the VA started paying veterans who had served on the ground there _ meaning possible exposure to Agent Orange _ and went on to develop diseases that eventually included lung and prostate cancer.

Then in 2001, the VA added Type 2 diabetes to the list. The disease affects 1 in 4 U.S. senior citizens and has not been definitely linked to Agent Orange. But veterans groups lobbied to include it.

"The feeling was, let's give them whatever they need and move on," said Anthony Principi, the VA secretary at the time. Through 2013, the number of veterans receiving compensation for diabetes climbed from 46,395 to 398,480.

The Obama administration added three more conditions in 2010: Parkinson's disease, a rare form of leukemia and ischemic heart disease. Since then, more than 100,000 cases of heart disease _ the leading cause of death in the U.S. _ have been added to the disability rolls.

Veterans of all generations also have been encouraged to apply for compensation for post-traumatic stress disorder, with Vietnam and the recent wars driving the growth in roughly equal measure over the last decade.

Some veterans said they have lived with the disorder ever since leaving the military. Others kept it at bay until recent wars or major life changes released old demons. The economic uncertainties of retirement age also gave veterans more incentive to apply.

As post-traumatic stress disorder claims boomed, the Obama administration made them easier to win.

The VA had long required documentation of a traumatic event that resulted in post-traumatic stress disorder. But in 2010, in keeping with the current science, the administration said a qualifying trauma could simply be a fear-inducing situation such as traveling through enemy territory.

Karen Olszewski, who works in Long Beach for the nonprofit Vietnam Veterans of America, said that once the rules changed, she started calling men whose cases she had rejected.

"I told them to come back," she said.

More than 1.3 million veterans of the Vietnam era received $21 billion in disability pay last year. From Afghanistan and Iraq, the cost was $9.3 billion _ but it is growing fast.

Among disabled veterans of recent wars, 43 percent have tinnitus, the most common condition. Rounding out the top 10 are back or neck strain, knee problems, post-traumatic stress disorder, migraines, arthritis of the spine, scars, ankle trouble, defective hearing and high blood pressure.

"They're filing for the basic wear and tear of military service, not combat injuries," said Phillip Carter, a veterans expert at the Center for a New American Security, a nonpartisan think tank.

One of the latest trends, resulting from another policy change, is a rise in disability determinations related to sleep apnea _ from 11,742 to 164,107 over the last decade.

The Pentagon had long prohibited veterans from receiving disability pay in addition to their military pensions. But in 2003, officials lifted the ban if a veteran had a disability rating of at least 50 percent. The change triggered a surge in claims costing billions of dollars _ including many by veterans with sleep apnea, which is typically rated as a 50 percent disability.

The condition tends to strike in middle age due to weight gain and can usually be managed by wearing a breathing mask while sleeping, but the VA does not consider such external devices in its disability decisions.

Retired Navy veteran David Adams said he was surprised that sleep apnea, for which he wears a breathing mask, qualified him for disability pay. At 49, he works as an electrician in an aluminum factory in Davenport, Iowa. He said his monthly disability pay of $910 gives his family financial security by boosting his $1,800-a-month military pension.

"Most of the time, the rules are against you," Adams said. "You get one that's for you, you don't question it."

___

The expansion of disability benefits signals a change in attitude about the purpose of the payments, long intended to compensate veterans for lost income. Studies have found that many disabilities in the system have no effect on average earnings. One showed that veterans receiving disability pay tend to have higher total incomes than those who do not.

In the age of an all-volunteer military and after two unpopular wars, disability pay has come to be seen as a lifetime deferred payment for service.

Roderick Atkinson, who spent 26 years on active duty and as a reservist, said he views it as compensation for the hardships he endured.

"The real kicker was the time I spent away from my family," Atkinson said.

The 53-year-old's voice flattened when talking about how he developed post-traumatic stress disorder after living in fear of mortar attacks in Iraq _ and how it rendered him unable to work around other people. The Santa Monica mail carrier counts knee and ankle problems among his ailments.

He has a 100 percent disability rating, entitling him to a monthly check of $3,200.

Espinosa, the Fort Lee trainer, said his monthly $1,792 disability check is scarcely making him rich. All of it goes for his son's college education.

He has filed new claims for back and knee pain, gastrointestinal problems and vertigo in an attempt to boost his 80 percent disability rating.

"I believe my disability rating _ and I'm not trying to sound greedy _ should be 100 percent," he said. "I know what I went through."

Related:

A Guide to U.S. Military Casualty Statistics: Operation New Dawn, Operation Iraqi Freedom, and Operation Enduring Freedom, February 19, 2014 

Military and Federal Workers Are Living the Good Life While the Ones Who Pay Their Salaries Struggle

Between 2001 and 2009, per capita spending on three major components (basic pay and allowances for housing and subsistence) of cash compensation for active military personnel rose by 37 percent in inflation-adjusted dollars.

Government Would Save Billions by Capping Pay, CBO Says

March 15, 2011

GovExec.com - Reducing annual pay increases for federal civilian workers and military personnel would save the government billions of dollars during the next decade, according to the latest figures from the Congressional Budget Office in a report on trimming the burgeoning deficit.

CBO estimates the deficit will rise to $7 trillion during the next 10 years if mandatory and discretionary spending is not reined in across government. Capping military pay increases and reducing the annual across-the-board adjustment for civilian raises are two available areas, among several others, for cuts, the March 2011 report said.

The nonpartisan CBO said if the government capped the basic pay increase for service members from 2012 to 2015 and set raises at a rate 0.5 percentage points below the increase in the employment cost index,

it would save about $6 billion between 2012 and 2016, and $17 billion between 2012 and 2021. Since 2001, lawmakers have approved military pay raises for the average service member that exceeded the ECI by 0.5 percentage point.

President Obama's fiscal 2012 budget request proposes a 1.6 percent pay raise for military personnel and allocates an overall $8.3 billion for education, housing and other quality of life programs for service members.

"Between 2001 and 2009, per capita spending on three major components of cash compensation for active military personnel rose by 37 percent in inflation-adjusted dollars," the report said, citing basic pay, and allowances for housing and subsistence, as the primary compensation categories.

Overall, the Defense Department accounts for more than half of all annual discretionary funding, and any significant deficit reduction needs to take into account Defense appropriations, CBO said.

Nearly 40 percent of all spending is discretionary, totaling more than $1.3 trillion in 2010.
As for civilian compensation, CBO says the government could save about $10 billion during five years and $50 billion during 10 years by reducing by 0.5 percent the annual across-the-board pay raise expected under the 1990 Federal Employees Pay Comparability Act from 2013 to 2021. Obama has called for a federal civilian pay freeze in 2011 and 2012. Compensation costs for civilian personnel make up about 15 percent of federal discretionary spending, according to CBO.

But the report said the bigger savings would come from capping military pay.

According to CBO's analysis, "median cash compensation for military personnel -- including the tax-free cash allowances for food and housing -- exceeds the salaries of most civilians who have comparable education and work experience."

CBO acknowledged that reducing pay for service members and civilians could hinder recruitment and retention.

"That effect might be more pronounced for federal agencies that require workers with advanced degrees and professional skills."

To offset some of the pain associated with lowered base pay for service members in particular, CBO suggested expanding reenlistment bonuses. 

The report highlighted other areas for spending savings that would affect the health care benefits of Defense personnel, among them:

• An increase in cost-sharing in TRICARE for military retirees who are not yet eligible for Medicare;


• A limit on the TRICARE benefit for military retirees and their dependents (many enrollees who already have employer-sponsored insurance through a civilian job opt for enrollment in TRICARE Prime, which has the lowest out-of-pocket costs within the TRICARE system);


• An increase in cost-sharing for prescription drugs under TRICARE.

NSPS Employees Can Expect 2.26 Percent Pay Boost

January 11, 2011

GovExec.com - Defense Department employees still under the National Security Personnel System will see a pay boost this month, according to Pentagon leadership.

A Dec. 27, 2010, memo from Undersecretary of Defense for Personnel and Readiness Clifford Stanley clarifies the funding available for performance-based pay increases for more than 54,000 workers and creates a salary "control point," designed to match pay limits with those that will apply when employees transition out of NSPS.

According to a Defense spokeswoman, 2.26 percent of salaries within a given pay pool are available for performance-based pay increases. Employees will be eligible for performance-based bonuses that individual agencies will determine, but those awards are neither automatic nor guaranteed. According to the spokeswoman, agencies are still compiling the pay pool data for the 2010 payout, but employees must have received a rating of "3" or higher to be eligible for a performance award.

The 2.26 percent is used for calculating and budgeting the available funds for NSPS annual performance awards. Performance-based increases and raises under Accelerated Compensation for Developmental Positions, which recognizes improvement of employees in training programs and other developmental capacities, might be included in pay raise calculations, according to the memo.

A mandatory control point, however, prevents employees from receiving a performance-based raise if the increase will push their salary above Level IV of the Executive Schedule, or $155,500.

The control point does not apply to physicians or dentists, who will be eligible for higher salaries matching those paid by the Veterans Affairs Department and the private sector, Stanley wrote.

Defense transferred nearly 172,000 employees, or 76 percent, back to the General Schedule in fiscal 2010, in keeping with department estimates. The remaining NSPS workers will move into alternative pay systems this spring, and all employees must transition by the end of 2011.

Congress repealed NSPS in the fiscal 2010 Defense authorization law, giving the department until Jan. 1, 2012, to roll back the controversial pay-for-performance system completely.

CLARIFICATION: This story was updated to reflect that some, but not all, NSPS employees could receive performance-based pay increases.

Concerns Over Pay Loom as Pentagon Returns to General Schedule

May 17, 2010

GovExec.com - The Federal Managers Association is asking lawmakers to ensure Pentagon employees do not lose salary as a result of the transition from the department's defunct pay-for-performance system.

"While the [2010] law explicitly states no employee shall lose or see a decrease in pay as they transition, I am concerned that this language will allow DoD officials to freeze future pay of top performers due to current [General Schedule] rules on pay retention," FMA National President Patricia Niehaus said in a May 14 letter to the leadership of the House and Senate Armed Services Committees.

According to Nieuhaus, since the average pay raise under the National Security Personnel System exceeded raises under the General Schedule, many NSPS employees are now, in terms of salary, a GS level above where they were when they entered NSPS. When these employees return to the GS grade they occupied prior to their conversion into NSPS, it is likely their salary will exceed the GS Step 10 level, Niehaus said. Under pay retention rules, these employees would receive only half the annual pay raise until the GS system catches up with them.

"We are increasingly concerned with the rush of DoD officials to transition employees out of NSPS without taking a close look at the number of employees likely to be subject to pay retention rules," Niehaus said.

An FMA survey of its members showed an average of 20 percent to 25 percent of employees are subject to pay retention rules. If FMA's members are representative of NSPS employees as a whole, then about 40,000 employees could face a decrease in pay.

"Many of these dedicated employees have crunched the numbers and determined that the General Schedule will not catch up with them by the time they retire over the next decade," Niehaus wrote. "This is unacceptable."

FMA is most concerned that pay retention would have the greatest effect on employees who were top performers under NSPS, which Niehaus said would send the message that above-average performance is not rewarded in the federal workplace.

"As members of the Federal Managers Association prepare to transition out of NSPS, I respectfully request that you take action to ensure high-performing DoD civil servants receive the compensation they have rightfully earned before they are forced to endure the effects of this unjust policy," the letter said.

The House Armed Services Committee will mark up the 2011 Defense authorization bill on Wednesday. Spokespeople from both the majority and the minority sides said they were unable to discuss the legislation heading into the markup. But it's likely the bill will address the NSPS transition, given the requirement that all Defense employees leave the system by Jan. 1, 2012.

Related:

Number of Federal Employees Getting Automatic Grade Promotions Jumped 75 Percent in Past Three Years, with Raises of 10 Percent to 20 Percent in One Year

Read More...

House Approves Bill Authorizing $633 Billion in Defense Spending Including 1.7 Pay Increase for Military Personnel

Between 2001 and 2009, per capita spending on three major components (basic pay and allowances for housing and subsistence) of cash compensation for active military personnel rose by 37 percent in inflation-adjusted dollars.

House approves bill authorizing $633 billion in defense spending

December 20, 2012

Reuters - The U.S. House of Representatives approved the final version of the annual defense policy bill on Thursday, authorizing $633.3 billion in defense spending for 2013, easing limits on satellite exports and providing more Marines for embassy security.

The Republican-controlled House approved the 2013 National Defense Authorization Act by a vote of 315-107. The measure must still be approved by the Senate before it can go to President Barack Obama to be signed into law.

The measure authorizes a Pentagon base budget of $527.5 billion, plus $88.5 billion for overseas operations, primarily the war in Afghanistan. The base budget includes $17.4 billion for defense-related nuclear programs at the Energy Department.

The NDAA sets defense policy for the year. While it authorizes spending levels for different military programs, it does not appropriate the money. That is done under separate legislation in the House and Senate.

In addition to authorizing the size of the military budget, the bill approved a 1.7 pay increase for military personnel and blocked a Pentagon effort to offset rising healthcare costs for retirees by raising some health insurance fees.

The measure eases restrictions on the export of satellites to help U.S. manufacturers, who have seen their global share of the market shrink to less than 25 percent from 65 percent 15 years ago, said Representative Adam Smith, the top Democrat on the House Armed Services Committee.

"The cumbersome nature of that regime has significantly harmed U.S. satellite industry," Smith said during debate on the measure. "Getting back to a competitive place with that industry is critical to our national security."

The measure directs Defense Secretary Leon Panetta to develop and implement a plan to increase the number of Marines assigned to embassy and consulate security by up to 1,000.

The move aims to bolster diplomatic security following the death of U.S. Ambassador Christopher Stevens in an attack on the consulate in Benghazi, Libya.

The final bill also allows the Pentagon to continue its efforts to develop biofuels, rejecting a House attempt to prevent the purchase of fuels that are more expensive than petroleum and to place limits on military assistance to companies trying to build commercial scale biofuel refineries.

Feds Recruit New World Order Cronies to Work for the Beast, the United Governments of the World, and Generously Compensate Them with Funds from the Public Treasury While 'Ordinary' Taxpayers Make the Sacrifices

The elites establishing world government have openly stated a plan to exterminate 6 billion people. The system is not run by people who are just corrupt, it is controlled by blood lusting control freaks who are unspeakably evil. - Infowars.com, March 11, 2012

In Search of Highly Skilled Workers: The Study on the Hiring of Upper Level Employees from Outside the Federal Government

A Report to the President and the Congress of the United States by the U.S. Merit Systems Protection Board

February 2008

Dear Sirs and Madam:

In accordance with the requirements of 5 U.S.C. 1204(a)(3), it is my honor to submit this U.S. Merit Systems Protection Board (MSPB) report, “In Search of Highly Skilled Workers: A Study on the Hiring of Upper Level Employees from Outside the Federal Government.” This report presents the findings of a study the MSPB conducted on the hiring of new employees at the upper level grades 12, 13, 14 and 15 in the General Schedule (GS) or similar pay plans in fiscal year 2005.

Each year, the Government hires tens of thousands of new employees. Traditionally, the vast majority of these new employees were appointed at grades GS-11 and below. However, the number of new hires at grades GS-12 and above has been increasing, especially since FY 2000. This trend is likely to continue as more employees retire, many of whom must be replaced to ensure that the Government has the expertise it needs to achieve its missions. In addition, as the needs of the American people become more complex, new programs often require the influx of new expertise at higher levels in the organization.

As the senior or journeyman-level specialists, analysts, supervisors and managers, these new upper level employees have critical roles in the effective and efficient operation of the government. MSPB studied this group of new employees to determine whether the Government is hiring the best applicants for these jobs in accord with the merit system principles and to find ways to improve the hiring of these highly skilled and experienced personnel.

I believe that you will find this report useful as you consider issues regarding the future of the Federal civil service.

Respectfully,
Neil A. G. McPhie, Chairman
U.S. Merit Systems Protection Board

Excerpt:

Since FY 1990, the number of new upper level employees hired has steadily increased. In FY 2005, the Government hired more than 12,000 new upper level employees. This number is 39 percent more than the 8,600 new upper level employees hired in FY 1990—the year preceding the downsizing and restructuring that occurred in the 1990s. The Government’s hiring pattern largely follows its overall priorities.

Homeland security, national defense, and the need to deliver services to the American public through the use of technology were three of the many Government priorities in FY 2005. These priorities were mirrored in who was hired in the Government, the types of upper level positions filled, and the agencies that did most of the hiring.

• Eighty percent of the new upper level employees were hired by 10 agencies, with the Department of Defense (DoD) and its major components (i.e., Air Force, Army, Navy and Marines) accounting for about half (47 percent) of the new hires. However, the hiring of new upper level employees did not occur equally across a department or agency. Rather, this hiring was concentrated in a few subordinate agencies of a department, or in a certain office or division of an agency, with responsibility to carry out priority programs.

• Although the new hires were appointed in 219 occupations, more than half (53 percent) were appointed in only 10 occupations. Many of the occupations support homeland security and national defense. Nevertheless, the number one occupation filled was information technology management, which is common to virtually all agencies.

• Many of the new hires had Government-related experience, which was gained either as employees of Federal contractors or members of the military service. Former employees of Federal contractors and former military members comprised almost half (48 percent) of FY 2005’s upper level new hires.

The hiring processes agencies used influenced who was hired.

• Although agencies relied on USAJOBS to advertise job vacancies, this was not the survey respondents’ primary source of job information. More new hires relied on their network of friends, their relatives, and their new Federal supervisors and co-workers to learn about job opportunities. Word of mouth is effective not only for some applicants, but also for agencies trying to find high-quality applicants. However, this approach has a limited reach and cannot be relied upon to ensure a diverse applicant pool.
  

• Assessment methods were sometimes used that unnecessarily limited who can qualify for vacant jobs. To ensure they get the person they believe is right for the job, agencies sometimes restrict competition through the use of selective factors. Although selective factors can ensure that only those with the right qualifications are hired for the job, they can also limit the pool of applicants who can qualify and, ultimately, the number of applicants referred for selection. Furthermore, agencies sometimes use selective factors inappropriately. Selective factors that are too restrictive can act as artificial barriers to open competition, eliminating qualified applicants from further consideration.

• The use of competitive examining—the traditional method of filling competitive service jobs—decreased from 64 percent in FY 1999 to 39 percent in FY 2005 for hiring new upper level employees. This decrease corresponded with the implementation of the Veterans Employment Opportunity Act of 1998. Since its implementation in FY 2000, hiring of new upper level employees under the Act increased from 6 percent of all the Government’s new upper level employees to 26 percent in FY 2005. The proportion of former military members hired under the Act has had considerable influence on the composition of the upper level new hires.

In 1953, about 75 percent of federal employees had a GS level of 7 or below. By 2009, in contrast, more than 70 percent of the workforce was GS 8 or higher (the 2011 pay scale for a GS 8 is $37,631 - $48,917; for a GS 15, it is $99,628 - $129,517, and can reach a high of $155,500 when locality pay is factored in). In 2009, there were 857,275 federal employees in grades GS9-GS15 — this figure represents the entire federal workforce, not just those in the Washington, DC metropolitan area. There were 445,749 federal employees in grades GS1-GS8. Of the total U.S. workforce, about 10 million Americans have incomes over $100,000 per year. [Source]

The average public sector worker spends about 30 years in the workforce and 30 years retired, and the average private sector worker spends about 40 years in the workforce and 20 years retired. California public sector retirees, on average, receive a retirement pension equal to 66% of their average base pay after working 30 years while private sector retirees receive retirement benefits equal to 33% of their base pay after working 40 years (in California the average base pay of public servants is $68,000 while the average base pay of private workers is $41,500). Extrapolated to the United States as a whole, it is clear that the California model would mean that public sector retirees would cost taxpayers $862 billion per year, which is only 6% less than the entire bill for Social Security for more than six times as many people. In other words, local and state public sector workers (16% of the workforce in California) retire 10 years earlier with retirement benefits 33% greater than private sector workers (84% of the workforce) — all at the expense of the taxpayers. [The Cost of Retirement Security in America, Free Republic, January 1, 2011]

If private citizens cannot collect Social Security benefits until age 62, and if the maximum Social Security benefit is $21,636 per individual, then why are federal employees allowed to retire at age 50 and why aren't their pensions capped at $21,636 per individual. Since 1987, federal employees including members of Congress have had the benefit of three guaranteed income payments in their retirement [for many federal retirees, their income is virtually unchanged — their retirement income is almost as much as their income while still employed by the federal government; and because they can retire so young, many of them start a second government career, double dipping into the public treasury].

Veterans Filing for Disability at Historic Rate

AP IMPACT: Almost Half of New Vets Seek Disability

May 27, 2012

AP - America's newest veterans are filing for disability benefits at a historic rate, claiming to be the most medically and mentally troubled generation of former troops the nation has ever seen.

A staggering 45 percent of the 1.6 million veterans from the wars in Iraq and Afghanistan are now seeking compensation for injuries they say are service-related. That is more than double the estimate of 21 percent who filed such claims after the Gulf War in the early 1990s, top government officials told The Associated Press.

What's more, these new veterans are claiming eight to nine ailments on average, and the most recent ones over the last year are claiming 11 to 14. By comparison, Vietnam veterans are currently receiving compensation for fewer than four, on average, and those from World War II and Korea, just two.

It's unclear how much worse off these new veterans are than their predecessors. Many factors are driving the dramatic increase in claims — the weak economy, more troops surviving wounds, and more awareness of problems such as concussions and PTSD. Almost one-third have been granted disability so far.

Government officials and some veterans' advocates say that veterans who might have been able to work with certain disabilities may be more inclined to seek benefits now because they lost jobs or can't find any. Aggressive outreach and advocacy efforts also have brought more veterans into the system, which must evaluate each claim to see if it is war-related. Payments range from $127 a month for a 10 percent disability to $2,769 for a full one.

As the nation commemorates the more than 6,400 troops who died in post-9/11 wars, the problems of those who survived also draw attention. These new veterans are seeking a level of help the government did not anticipate, and for which there is no special fund set aside to pay.

The Department of Veterans Affairs is mired in backlogged claims, but "our mission is to take care of whatever the population is," said Allison Hickey, the VA's undersecretary for benefits.

"We want them to have what their entitlement is."

The 21 percent who filed claims in previous wars is Hickey's estimate of an average for Operation Desert Storm and Desert Shield. The VA has details only on the current disability claims being paid to veterans of each war.

The AP spent three months reviewing records and talking with doctors, government officials and former troops to take stock of the new veterans. They are different in many ways from those who fought before them.

More are from the Reserves and National Guard — 28 percent of those filing disability claims — rather than career military. Reserves and National Guard made up a greater percentage of troops in these wars than they did in previous ones. About 31 percent of Guard/Reserve new veterans have filed claims compared to 56 percent of career military ones.

More of the new veterans are women, accounting for 12 percent of those who have sought care through the VA. Women also served in greater numbers in these wars than in the past. Some female veterans are claiming PTSD due to military sexual trauma — a new challenge from a disability rating standpoint, Hickey said.

The new veterans have different types of injuries than previous veterans did. That's partly because improvised bombs have been the main weapon and because body armor and improved battlefield care allowed many of them to survive wounds that in past wars proved fatal.

"They're being kept alive at unprecedented rates," said Dr. David Cifu, the VA's medical rehabilitation chief. More than 95 percent of troops wounded in Iraq and Afghanistan have survived.

Larry Bailey II is an example. After tripping a rooftop bomb in Afghanistan last June, the 26-year-old Marine remembers flying into the air, then fellow troops attending to him.

"I pretty much knew that my legs were gone. My left hand, from what I remember I still had three fingers on it," although they didn't seem right, Bailey said. "I looked a few times but then they told me to stop looking." Bailey, who is from Zion, Ill., north of Chicago, ended up a triple amputee and expects to get a hand transplant this summer.

He is still transitioning from active duty and is not yet a veteran. Just over half of Iraq and Afghanistan veterans eligible for VA care have used it so far.

Of those who have sought VA care:

—More than 1,600 of them lost a limb; many others lost fingers or toes.

—At least 156 are blind, and thousands of others have impaired vision.

—More than 177,000 have hearing loss, and more than 350,000 report tinnitus — noise or ringing in the ears.

—Thousands are disfigured, as many as 200 of them so badly that they may need face transplants. One-quarter of battlefield injuries requiring evacuation included wounds to the face or jaw, one study found.

"The numbers are pretty staggering," said Dr. Bohdan Pomahac, a surgeon at Brigham and Women's Hospital in Boston who has done four face transplants on non-military patients and expects to start doing them soon on veterans.

Others have invisible wounds. More than 400,000 of these new veterans have been treated by the VA for a mental health problem, most commonly, PTSD.

Tens of thousands of veterans suffered traumatic brain injury, or TBI — mostly mild concussions from bomb blasts — and doctors don't know what's in store for them long-term. Cifu, of the VA, said that roughly 20 percent of active duty troops suffered concussions, but only one-third of them have symptoms lasting beyond a few months.

That's still a big number, and "it's very rare that someone has just a single concussion," said David Hovda, director of the UCLA Brain Injury Research Center. Suffering multiple concussions, or one soon after another, raises the risk of long-term problems. A brain injury also makes the brain more susceptible to PTSD, he said.

On a more mundane level, many new veterans have back, shoulder and knee problems, aggravated by carrying heavy packs and wearing the body armor that helped keep them alive. One recent study found that 19 percent required orthopedic surgery consultations and 4 percent needed surgery after returning from combat.

All of this adds up to more disability claims, which for years have been coming in faster than the government can handle them. The average wait to get a new one processed grows longer each month and is now about eight months — time that a frustrated, injured veteran might spend with no income.

More than 560,000 veterans from all wars currently have claims that are backlogged — older than 125 days.

The VA's benefits chief, Hickey, gave these reasons:

—Sheer volume. Disability claims from all veterans soared from 888,000 in 2008 to 1.3 million in 2011. Last year's included more than 230,000 new claims from Vietnam veterans and their survivors because of a change in what conditions can be considered related to Agent Orange exposure. Those complex, 50-year-old cases took more than a third of available staff, she said.

—High number of ailments per claim. When a veteran claims 11 to 14 problems, each one requires "due diligence" — a medical evaluation and proof that it is service-related, Hickey said.

—A new mandate to handle the oldest cases first. Because these tend to be the most complex, they have monopolized staff and pushed up average processing time on new claims, she said.

—Outmoded systems. The VA is streamlining and going to electronic records, but for now,

"We have 4.4 million case files sitting around 56 regional offices that we have to work with; that slows us down significantly," Hickey said.

Barry Jesinoski, executive director of Disabled American Veterans, called Hickey's efforts "commendable," but said: "The VA has a long way to go" to meet veterans' needs. Even before the surge in Agent Orange cases, VA officials "were already at a place that was unacceptable" on backlogged claims, he said.

He and VA officials agree that the economy is motivating some claims. His group helps veterans file them, and he said that sometimes when veterans come in, "We'll say, 'Is your back worse?' and they'll say, 'No, I just lost my job.'"

Jesinoski does believe these veterans have more mental problems, especially from multiple deployments.

"You just can't keep sending people into war five, six or seven times and expect that they're going to come home just fine," he said.

For taxpayers, the ordeal is just beginning. With any war, the cost of caring for veterans rises for several decades and peaks 30 to 40 years later, when diseases of aging are more common, said Harvard economist Linda Bilmes. She estimates the health care and disability costs of the recent wars at $600 billion to $900 billion.

"This is a huge number and there's no money set aside," she said. "Unless we take steps now into some kind of fund that will grow over time, it's very plausible many people will feel we can't afford these benefits we overpromised."

How would that play to these veterans, who all volunteered and now expect the government to keep its end of the bargain?

"The deal was, if you get wounded, we're going to supply this level of support," Bilmes said. Right now, "there's a lot of sympathy and a lot of people want to help. But memories are short and times change."

2.2 Homesowners Eligible for a Cut in FHA Fees When Refinancing; Military Personnel Whose Homes Were Wrongly Foreclosed Will Receive the Amount of the Lost Equity Plus Interest and $116,785

For homeowners refinancing mortgages issued before June 1, 2011, the latest plan reduces the cost of up-front FHA mortgage insurance premiums to 0.01 percent from 1 percent of a borrower's loan balance [effective April 1, 2012, this fee will be increased to 1.75 percent for new mortgage loans]. It also cuts the annual fee for these loans in half to 0.55 percent. Many FHA borrowers have found refinancing prohibitive in recent years because of increased insurance premiums. The administration has been raising fees for FHA loans to shore up the agency's dwindling capital and shrink its footprint in the market. The agency backs about a third of all new mortgages.

Obama Offers Mortgage Relief to Millions of Homeowners

March 6 2012

Reuters - President Barack Obama announced on Tuesday a cut in fees on many government-backed mortgages that he said could help millions of homeowners refinance, part of an election-year push to boost the shaky U.S. housing market.

Under the plan, a typical borrower with a loan backed by the Federal Housing Administration could save a thousand dollars a year by refinancing into a new FHA loan, the White House said. The fee reductions would be on top of any savings from a lower interest rate.

Two million to three million borrowers would be eligible, although the White House said participation would more likely number in the "hundreds of thousands."

The step is the latest in a series by the Obama administration to aid a depressed U.S. housing market and homeowners threatened by a rising tide of foreclosures.

About 11.1 million Americans now owe more than their homes are worth.

"I'm not one of those people who believe that we just sit by and wait for the housing market to hit bottom," Obama said at a news conference. "There are real things we can do right now that would make a substantial difference in the lives of innocent, responsible homeowners."

Obama, who faces re-election in November, introduced the cut in mortgage fees alongside efforts to compensate members of the military who may have been wrongfully foreclosed.

The lower fees being put in place would be available to borrowers seeking a new loan through FHA's streamlined refinancing program, and even borrowers who owe more on their mortgage than their homes are worth would be eligible.

Under the streamlined program, borrowers must be current on their payments and income verifications, and appraisals are waived. The reduced fees announced today would be available to borrowers who are refinancing loans taken out before June 1, 2009.

BROAD BENEFITS FOR THE ECONOMY

Of the 5.4 million 30-year fixed-rate mortgages that the FHA backs, 3.2 million would not be eligible because they were issued after the June 1, 2009, cut-off date, according to Mahesh Swaminathan, an analyst at Credit Suisse Group AG.

The reduced fees, though, should help enough homeowners that there will be a positive ripple effect throughout the U.S. economy, according to Jaret Seiberg, senior policy analyst with Guggenheim Securities.

"This should be broadly positive for housing and the economy by reducing foreclosures and freeing up income for consumers to spend on other goods and services," Seiberg wrote in a note to Guggenheim clients.

The biggest banks, such as Wells Fargo & Co. (WFC.N), Bank of America Corp (BAC.N) and JPMorgan Chase & Co. (JPM.N), are likely to see an increase in refinancing volume, which could mean higher income from fees related to FHA mortgages, he wrote.

While mortgage rates are at historic lows around 4 percent, many Americans lack the equity to refinance. Others are locked out by tight credit conditions.

Obama has announced several changes to the administration's housing policies this year to help borrowers, including an expansion of an existing mortgage relief program that had failed to reach as many homeowners as hoped.

The latest plan, which does not need congressional approval, reduces the cost of up-front FHA mortgage insurance premiums to 0.01 percent from 1 percent of a borrower's loan balance. It also cuts the annual fee for these loans in half to 0.55 percent.

Many FHA borrowers have found refinancing prohibitive in recent years because of increased insurance premiums. The administration has been raising fees for FHA loans to shore up the agency's dwindling capital and shrink its footprint in the market. The agency backs about a third of all new mortgages.

MILITARY PERSONNEL TO GET RELIEF

The White House also announced more details about an agreement with mortgage servicers to compensate people serving in the military and veterans who faced wrongful foreclosure.

It said servicers will reviews thousands of foreclosures on properties owned by members of the military and will pay those whose homes were wrongly seized the amount of lost equity plus interest and $116,785.

The administration is also seeking refunds for military personnel who were wrongfully denied refinancing.