Congress Moves Decisively To Close Scandalous Loophole – What’s The Catch?

Being a member of Congress has its privileges. Among them: a generous combination of salary and benefits, plus the opportunity to earn some extra cash through a side hustle.

And the benefits keep on coming long after retirement, thanks to a generous retirement plan. Which, thanks to a loophole, will pay benefits even to members who’ve been convicted of a crime. (RELATED: The Antiquated Law That Deserves To Be Scuttled)

But maybe not for much longer. As the National Taxpayers Union’s Demian Brady writes, bipartisan legislation – called the “No Corruption Act” – to close that pension plan loophole has passed the Senate. What the bill does is cut off the checks once a member is convicted. Current law allows the retirement money to flow until the appeals process has run its (sometimes lengthy) course:

Under the Honest Leadership and Open Government Act of 2007, members of Congress who are convicted of certain crimes are supposed to lose eligibility for their congressional pension. A follow up law, the Stop Trading on Insider Knowledge Act of 2012, added to the list of crimes that would lead to the loss of this benefit. Unfortunately, the pension was not actually forfeited until all opportunities for appeal expire. This means that payments can continue for years until the legal process runs its course. In addition, pensions paid out during this appeals process would not be clawed back even after final conviction.

The No CORRUPTION Act would cut off pension benefit payments once a member has been convicted. If a member’s appeal is subsequently successful, the annuity amount would be fully paid out retroactively. This is an important reform that would balance taxpayers’ interest with the constitutional rights of the accused. [emphasis added]

The No Corruption Act passed the Senate unanimously. There is no reason this side of pure mule-headedness for the House not to do the same. (RELATED: Congressional Watchdog Reveals Effective Ways To Immediately Slash Spending. Will Anyone Listen?)

And just in case you’re wondering about congressional retirement pay, here’s a rundown from Investopedia:

Congressional members are eligible for their own unique pension plans under the Federal Employees Retirement System (FERS), though there are other retirement benefits available, ranging from Social Security and the Civil Service Retirement System (CSRS). Currently, members of Congress are eligible for a pension dependent on the member’s age at retirement, length of service, and salary. The pension value can be up to 80% of the member’s final salary. Since 2009 Congressional pay has been $174,000 per year, which, at an 80% rate, equates to a lifelong pension benefit of $139,200. All benefits are taxpayer-funded.

Additionally, members of Congress enjoy the same Thrift Savings Plan (TSP) as all other federal employees, which is similar to a 401(k). More taxpayer funds are used to match Congressional contributions up to 5% per year, in addition to an extra 1% giveaway regardless of how much the congressman or congresswoman contributes, if anything. Because members of Congress earn far more than the average American citizen, their initial Social Security benefits average just under $26,000 per year compared to $17,652 for the average retired worker in 2019.

All that and no heavy lifting, either. Not a bad gig if you can get it and keep it just long enough to be fully vested (about five years).

The opinions expressed in this article are those of the author and do not necessarily reflect the positions of American Liberty News.

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