Congress Reins In Excessive Pensions for Top Brass

Star creep—the creation of a top-heavy military with a historically large proportion of generals and admirals—hurts morale, combat effectiveness, and the budget. Congress took a small step to address the exorbitant financial costs of Star Creep in the fiscal year 2015 National Defense Authorization Act (NDAA) by freezing pay for top officers and ending the practice of paying some top officers more through their pensions than they received in uniform. This change comes over the protests of General Martin Dempsey, the chairman of the Joint Chiefs of Staff, who wrote to the House and Senate Armed Services committees in opposition to “piecemeal” reforms.

The practice of paying generals more in their pensions than they received when they were in active service was first reported in USA Today, when the 2007 NDAA changed the pension laws to increase the annual pensions exponentially. Prior to the change, a retired four-star officer could receive no more than $179,900 each year while in uniform and typically received $134,400 each year in pension. But under the 2007 formula, one retired four-star officer with 43 years of service, for instance, took home $272,892 per year—more than double the pension previously allowed by law, and nearly $93,000 more per year than what he received in active service.

The policy change was designed to address concerns that the military would lose too many experienced generals and admirals during the wars in Iraq and Afghanistan. The Pentagon’s controversial “military mentors” program, which allowed retired officers with financial ties to defense contractors to “help run war games and offer advice,” was justified under the same logic.

The Pentagon has never released any assessment to show that the pension reforms or the military mentor programs achieved their stated goals. We do know, however, that Secretary Gates’s decision to require these mentors to file public financial disclosure documents convinced 98 percent of the mentors to drop out of the program.

Senator Kelly Ayotte (R-NH) pointed out the costs of out-of-control pensions in a hearing last February, noting that the military services asked Congress to cut troops and benefits for enlisted military families without considering sensible reforms for generals and admirals.

Next month Congress will consider recommendations for additional cuts and reforms to military pay and benefits. We hope that they will continue to look critically on phony reforms that hurt the morale of our service members, combat effectiveness, and the taxpayer sand instead focus on trimming waste like fancy perks for top brass and wasteful weapon programs like the F-35 Joint Strike Fighter.