Woodward, Okla. — The measure, negotiated by Sen. Patty Murray, D-Wash., and Rep. Paul Ryan, R-Wis., averts $63 billion in across-the-board spending cuts that were themselves the result of an earlier inability of lawmakers and the White House to agree on a sweeping deficit reduction plan. That represents about one-third of the cuts originally ticketed for the 2014 and 2015 budget years and known in Washington as sequestration.
Democrats expressed satisfaction that money would be restored for programs like Head Start and education, and lawmakers in both parties and the White House cheered the cancellation of future cuts at the Pentagon.
To offset the added spending, the legislation provides about $85 billion in savings from elsewhere in the budget. Included are increases in the airline ticket tax that helps pay for security at airports and a fee corporations pay to have pensions guaranteed by the government. Most controversial by far was a provision to curtail annual cost of living increases in benefits that go to military retirees under age 62, a savings of $6.3 billion over a decade for the government.
By one estimate, the result would be a reduction of nearly $72,000 in benefits over a lifetime for a sergeant first class who retires at age 42 after 20 years of service. Veterans groups and their allies in Congress objected vociferously to what they said was a singling out of former members of the military, and key lawmakers in both parties said they would take a second look at the provision next year.
But Sen. John McCain, R-Ariz., said a veteran of identical rank who retired at 38 would still wind up with $1.62 million in retirement pay over a lifetime. He also pointed out that a prominent deficit commission headed by former White House chief of staff Erskine Bowles and former Sen. Alan Simpson had recommended abolishing cost of living increases for military retirement pay as part of a sweeping deficit reduction plan, a far deeper curtailment included in the legislation.