Wednesday, May 2, 2012

The Military Retirement Fund

It's projected to grow 300% over the next 10 years.  This is because the MRF gets special treatment:
"MRF uniquely benefits from a special law that obligates the Treasury Department to pay MRF an annual amount equal to a portion of the unfunded obligations of MRF. The law requires the Treasury to make the payment in “Warrants” (decidedly non-cash). The annual amount is calculated using a complex actuarial formula that is designed to eliminate 100% of the unfunded portion at MRS by 2026."

Social Security and the FERS also have large unfunded liabilities, but they are not entitled to have them covered with Treasury warrants.  "Those dependent on SS or FERS do not have the legal protection that MRS has. How can this be? As the annual cost of protecting military pensions skyrockets over the next few years, there will have to be political fallout. This will be an interesting war: the Retired American People versus the US Military. Who will win?"
--http://brucekrasting.blogspot.com/2012/05/military-winning-war-over-pensions.html

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