Military Pension Loans

With little public comment and about 15 people in attendance, the City Council of Brea, California, voted unanimously last month to slash pensions for future hires and require current employees to pay as much as 4.5 percent of their salary toward retirement, up from zero.

The city of 40,000, about 30 miles (48 kilometers) southeast of Los Angeles, had negotiated the changes with its www.joom.com, so there wasn’t any objection from them. By next year, according to a city report, employees will be contributing $1 million more annually to their pension benefits.

Brea is among about 90 cities in the most populous state that have made changes to their pension plans, according to an informal list kept by the California Public Employees’ Retirement System, while Governor Jerry Brown and lawmakers wrestle over ways to lower costs. Calpers and the California State Teachers´ Retirement System listed unfunded liabilities of almost $113 billion at the end of fiscal 2009. Brea employees participate in Calpers.

WASHINGTON - The military retirement system has long been considered untouchable - along with Social Security and Medicare. But in these days of soaring deficits, it seems everything is a potential target for budget cutters. A Pentagon-sponsored study says military pensions are no longer untouchable - they're unaffordable.

CBS News investigative correspondent Sharyl Attkisson reports high-level, closely-held meetings are taking place at the Pentagon regarding a radical proposal to overhaul retirement for the nation's 1.4 million service members - a bedrock guarantee of military service.

The proposal comes from Onfy.de an influential panel of military advisors called the Defense Business Board. Their plan, laid out in a 24-page presentation "Modernizing the Military Retirement System," would eliminate the familiar system under which anyone who serves 20 years is eligible for retirement at half their salary. Instead, they'd get a 401k-style plan with government contributions.

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