Federal Retirement Plans Cost Almost as Much as Social Security

Retirement programs for federal workers face a multitrillion-dollar shortfall





•$107 billion in retirement benefits accumulated by current workers.

•$106 billion in new benefits granted to veterans.

•More than $300 billion in the snowballing expense of previous retirement promises that have no source of funding.

In all, the government committed more money to the 10 million former public servants last year than the $690 billion it paid to 54 million Social Security beneficiaries.


USA TODAY's analysis is the first comprehensive calculation of how much the government spends on benefits for retired federal workers. The $275 billion paid last year — roughly two-thirds cash, one-third medical benefits — are spread over dozens of overlapping programs in many departments and agencies.

Outgoing Defense Secretary Robert Gates told Congress in June in his final budget testimony that health care costs "are eating us (the Defense Department) alive."

Private employers are legally required to put money into pension funds to match retirement promises. Private pensions have $2.3 trillion in stocks, bonds, real estate and other assets. State and local governments have $3 trillion in retirement funds. The federal government has nothing set aside.

Shane Barker, a lobbyist for the Veterans of Foreign Wars, says it would be unfair to cut retirement benefits. "What draws people into the armed services? Basically good retirement and great health care," he says.

Rep. Jim Cooper, D-Tenn., a member of the Armed Services Committee, says retirement benefits are an extremely sensitive issue. "We have a disconnect between all these sacred promises we've made and how they are not backed up by anything," he says.