The Foreign Service Journal, May 2005

T hroughout the spring and probably beyond, Topic A inWashington will be Social Security. This is of obvi- ous interest to Foreign Service retirees, many of whom either receive or will receive Social Security. It should be of particular interest to those who left the old “FSDRS” retire- ment system in order to join the new system, with smaller benefits. Eligibility for Social Security was a key element in the deal we were offered to encourage us to join the new system. If its benefits were now to be reduced, the result of the cost-benefit analysis we made before signing up for the new system could be substantially altered. However, in presenting his pro- posals for Social Security reform to Congress, President Bush said there would be no change in the benefits that Social Security annuitants now receive. The administration’s pro- posal would reduce the benefits eventually payable to younger peo- ple in order to allow them to invest part of their payroll taxes in stocks and bonds. The argument is that this will ensure both larger benefits—as a result of the active worker’s shrewd investments — and a smaller burden on the Social Security trust fund, because it will pay out less in benefits. For a detailed explanation and discussion of the pro- posals, I refer you to the AFSA retireeWeb page, www.afsa.org/rtvppage.cfm. AF SA will continue to update and expand the information on the site. Opponents of the administration proposals point out that the Social Security trustees say the system is good until 2041 and 2042 — the Congressional Budget Office says 2052—and that no reduction in benefits would be needed before then. That of course doesn’t mean reform isn’t needed; everyone seems to agree that some changes will have to be made, either now or later. Analysts outside Congress say there is no alternative to either reducing the level of benefits or raising the age at which benefits begin, or both. Needless to say, neither alternative looks palatable to Congress. AFSA, including its Social Security recipients on the Governing Board and the staff, will continue to follow the Congressional and public debate over the admin- istration’s proposals, and we will keep our members posted. My guess is that what- ever the outcome of this year’s debate, Social Security will continue to be on the public agenda for a long time to come. ▫ V.P. VOICE: RETIREE ■ BY GEORGE F. JONES Social Insecurity Eligibility for Social Security was a key element in the deal we were offered to encourage us to join the new system. MAY 2005 • AFSA NEWS 7 AFSA NEWS BRIEFS Briefs • Continued from page 6 The Last TSP Open Season Say farewell to the traditional Thrift Savings Plan open seasons. After this open season, running fromApril through June, the rules will change and you will be able to contribute adjustments to your savings plan at any time of the year. For news on the changes and to alter your current plans, visit the TSPWeb site at www.tsp.gov. In addition, TSP will soon be offer- ing a new fund, the “L Fund,”which will calibrate investments based on various retirement timing scenarios based on the expected year of retire- ment, such as: 2015, 2020, 2025, etc. Request for Information on Merian Cooper FSO Robert Wong is writing a story about Merian C. Cooper, and asks Journal readers for any anecdotes they may have about Cooper. Some Foreign Service members may have met him when he was chief of staff to General Chennault in China or when he was chief of staff to General MacArthur during World War II. Any personal memories would be appreciated. Robert Wong, currently serving in Dhaka, has found that Merian C. Cooper's name is remembered among people in the region when talking about past U.S. actions. You can send input to him at wongre@state.gov. Briefs • Continued on page 8