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Saturday, December 10, 2011

Tales Exaggerate Congressional Pay and Pensions

As long as I can remember, there has been a vague general rumbling that members of Congress collect exorbitant salaries and outrageous pensions and other benefits. The rumblings have changed form over the years, from idle gossip to organized viral email campaigns, but the substance remains. Despite efforts to spread the truth, many Americans still contend that members of Congress take home truckloads of money, don’t participate in Social Security, and get full pay for their lifetimes after serving only a single term in Congress. Sorry, folks, it just isn’t true.


From 1789 to 1855, members earned just $6.00 for each day spent in Congressional legislative session. That would total $966 for House members and $924 for Senators for the 2011 calendar to date.

In 1855, Congress adopted an annual salary of $3,000. Raises came sporadically over the years, until the pay reached the current $174,000 in 2009. From that salary, they have to pay for two residences –one in their home districts and one in the Washington area.


Senate Majority and Minority Leaders Harry Reid and Mitch McConnell and their House counterparts Nancy Pelosi and Eric Cantor make $193,400. Speaker of the House John Boehner earns $223,500.


Congress passed the 27thConstitutional Amendment in 1789, but it wasn’t ratified until 1992. It states that Congress may vote itself a pay raise, but cannot accept that raise until after the next Congressional election. That gives the voters a chance to vote them out of office.


Since 1989, a cost of living adjustment raises pay automatically unless Congress votes not to implement it. The COLA is constitutional because it became law before the states ratified the 27thamendment. The Constitution prohibits Congress from passing ex post facto laws (Article I, Section 9, Clause 3). The law permits Congress to forgo its raise if the members choose to do so. Congress has not taken its raise since January, 2009.


Part of the griping alludes to the notion that Congress is the only group of people who can raise their own salaries. But if it were up to the voters, today’s members would still be making $6.00 a day. While “regular people” can’t give themselves a raise, corporate boards and officers routinely do so.


The current Congressional salary of $174,000 is almost five times the average American worker’s annual income of $33,272.20. The typical American corporate CEO made $9.25 million in salary, bonuses, and stock options in 2009. That’s 278 times the average worker’s pay.


No federal government employee, including members of Congress, participated in Social Security until 1984.They had their own retirement fund called the Civil Service Retirement System. In 1983, Congress amended the Social Security Act (P.L. 98-21), requiring all federal employees, including members of Congress, to participate in the Social Security Program and created a new, optional, retirement fund called the Federal Employee Retirement System. Members of Congress are eligible to participate in FERS.


Now, every person who tells you that members of Congress collect their full paychecks for life after serving only a single term in Congress is an absolute liar. Like most pensions, FERS is financed through a combination of employee and employer contributions. Also like private pension plans, benefits are calculated through a formula that considers both length of service and age at retirement.

According to a 2007 Congressional Research Service report:Under both CSRS and FERS, Members of Congress are eligible for a pension at age 62 if they have completed at least five years of service. Members are eligible for a pension at age 50 if they have completed 20 years of service, or at any age after completing 25 years of service. The amount of the pension depends on years of service and the average of the highest three years of salary. By law, the starting amount of a Member’s retirement annuity may not exceed 80% of his or her final salary.

The corollary to the outrageous pay canard is the delusion that members of Congress don’t bother to work for a living. Nothing could be further from the truth. I have been a public policy advocate and lobbyist for nearly 30 years. I have worked with members of Congress, their staffs, and Congressional committees. Regardless of my opinion of their politics, I can tell you that the vast majority of both elected representatives and staff members work harder than just about any other category of worker.


Membership in Congress is not a nine-to-five job. Congress only meets in legislative session about 100 days each year, but members spend much more time than that in committee meetings, hearings, staff and constituent meetings; reading bills, briefing materials, and correspondence; and making endless phone calls. And when they return to their home districts, they add functions, events, and town hall meetings to that list. And no matter where they go, someone is always grabbing their arms asking for “just a minute” of their time.

$174,000 is nothing to sneeze at. It’s a good living, but it’s not a fortune. I certainly wouldn’t want the job.


For more information:
Congressional Research Service: Congressional Salaries and Benefits, June 2011
Congressional Research Service: Retirement Benefits for Members of Congress, January 2011 

Pay and Perquisites of Members of Congress, Including A History of House and Senate Salaries
U.S House of Representatives
U.S. Senate

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