You may have heard that pensions for congressmen and most other federal employees are way out of whack. If you haven’t, listen to Hastings Keith.
Former Congressman Hastings Keith of Massachusetts is lobbying Congress to stop doling out far too generous cost-of-living increases, known as COLAs to retirees like himself. Keith says, “COLAs are supposed to keep up with the cost of living, not the cost of living it up.” He should know. Not only because he’s on the receiving end himself. Mr. Keith also chairs the National Committee on Public Employee Pensions. Keith says that after 14 years in Congress, his pension paid him $1,560 in the very first month after his 1972 election defeat. And now? Now he rakes in $7,172 a month almost a thousand more than he should after adjusting for inflation.
But the COLAs are also calculated too generously on his Social Security and on his widower benefits on his wife’s pension from the federal government. Only the COLA on his military pension falls short of inflation. In all, Keith pulls in more than $134,000 a year in retirement benefits. What did he have to do to get such a lucrative pay-out from taxpayers? He estimates he contributed less than $34,000 toward all these benefits, much of that in Social Security taxes. So, each year, Mr. Keith receives four times as much as he paid in over his entire lifetime. And he’s not alone. This is an outrageous rip-off of taxpayers, to the tune of billions of dollars. And everybody knows it.
This is Common Sense. I’m Paul Jacob.