Thursday, May 22, 2008

Mr. Webb’s Flawed Solution

Virginia Senator Jim Webb scored his first major legislative victory today, when the Senate passed his “new” GI Bill by a veto-proof margin, 75-22.

The measure will significantly increase education aid to those who served in Iraq and Afghanistan, providing a monthly living stipend, plus tuition assistance equal to the most expensive public college in each veteran’s home state.

Webb’s “enhanced” GI Bill now goes to President Bush, who has threatened to veto it. The White House, along with Senate Republicans, offered their own measure. That plan would increase the current tuition aid to $1500 a month, an increase of $400 over the current Montgomery GI Bill.

The GOP measure would also raise tuition assistance to $2000 a month for personnel who serve at least twelve years, and eliminate the current $1200 enrollment fee now paid by participating service members.

Webb’s measure will also eliminate the fee, while providing full benefits to veterans who serve as little as three years. Under the current version of the GI Bill, service members must serve at least six years to receive full tuition assistance.

The Republican plan, offered by South Carolina Senator Lindsey Graham and North Carolina’s Richard Burr, offered limited assistance to veterans serving as a little as two years. However, the GOP bill required that personnel serve at least four years before receiving full benefits.

The living stipend in the Webb bill is aimed at providing the same level of benefits given to returning veterans of World War II. Republicans--whose plan did not include a stipend--claim the new plan is too expensive and gives service members more reason to leave the military. As Mr. Graham noted during the Senate debate:

“I am not going to sit on the sidelines and, under feel-good politics, create a new program that will result in hurting retention at a time when America desperately needs to increase the ability to retain this force,” he said.

According to GOP estimates, Mr. Webb’s plan will cost at least $51 billion over the next decade --$13 billion more than the Republican version. The Veterans Administration puts the 10-year price tag at closer to $64 billion. Democrats have proposed a 0.5 surtax on individuals making more than $500,000 a year to finance the plan. Republicans suggested a cut in other spending to pay for the bill.

In terms of its impact on retention, Webb’s measure seems to be a wash. A recent study by the Congressional Budget Office (CBO) estimated that today’s bill could lead to a 16% drop in re-enlistments.

However, the CBO also claims that the new plan would boost recruiting by the same percentage (supposedly) resulting in lower costs for enlistment bonuses and other incentives. Overall, the CBO estimates, the new GI Bill would increase retention costs by about $1.1 billion over five years—to maintain the current force. Projected increases in the Army and Marine Corps will push that total higher.

As a military retiree, it’s tempting to jump on the bandwagon for the new bill. Veterans who’ve worn the uniform in Iraq and Afghanistan certainly deserve improved education benefits. The skyrocketing cost of college tuition (something Democrats never complain about) justifies some sort of enhanced education program.

But what will veterans (and taxpayers) get for another $6 billion a year? For one thing, some fuzzy math. As the Air Force discovered a few years ago, expanded benefit programs tend to grow well beyond early projections. When the service increased tuition assistance for active duty personnel--from 75% to 100%--the outlay for that benefit quickly doubled, to more than $140 million a year. A recent audit revealed that some of that money was wasted on courses like massage therapy--hardly what the Air Force had in mind.

True, $140 million may sound like chump change in a $500 billion defense budget, but it underscores the tendency of government programs to grow exponentially. We can only wonder how much Mr. Webb’s bill will really cost, since colleges have no incentive to hold the line on tuition costs under his plan.

There’s also the matter of who should qualify for educational benefits. Both the Webb bill and the Republican plan offer a "transfer" option, allowing veterans to pass unused benefits to a spouse or child, after a specified period of time.

While no one doubts the sacrifices made by military families, we believe military education benefits should rest with the service members. If their family members need educational assistance, there are plenty of grant and loan programs available. Adding the transfer component will require the VA to track benefits for millions of additional beneficiaries, increasing administrative costs.

We also question the logic of awarding full benefits to veterans before completion of their first enlistment. From our perspective, the Montgomery GI Bill--which has been in effect for more than 20 years--has a couple of attractive features. First, it requires veterans to make a commitment to the military, serving for at least six years before receiving full tuition benefits.

Secondly, the program also forces young soldiers, sailors, Marines and airmen to make a commitment to their education, but setting aside the "enrollment fee" during the first year of their enlistement. With their own money invested in the effort, veterans have a greater incentive to complete their schooling.

There's also the matter of helping those who stay in uniform. Mr. Webb's bill does nothing to expand off-duty education programs for career officers and NCOs--the backbone of our armed services. Instead, the Senator is aiming his program at "first termers" who leave the military at the end of their initial enlistment. Officers and NCOs who plan to stick it out to retirement (and hope to pursue a degree on active duty) might ask Senator Webb: what can you do for me? The answer will likely disappoint.

Indeed, Webb's own statistics also show that some branches of the military--the Air Force and Navy in particular--have high re-enlistment rates. In the case of the USAF, 51% of first-term airmen reenlist, and the Navy's retention rates are almost as high. Those airmen and sailors would benefit more from improved off-duty education programs and more money for tuition assistance. An optimum GI Bill would address the educational concerns of active duty personnel, as well as those who've returned to the civilian world.

Unfortunately, there seems little chance that the Webb measure will be modified before it becomes law. With today's veto-proof majority vote, there's little incentive for compromise. The expected veto from Mr. Bush will give the Democrats a chance to make political hay, slamming the president for failing to support the troops.

In an era that requires multiple educational options for military personnel, Mr. Webb's bill seems almost frozen in time. By concentrating on veterans who've left active duty, he ignores the education needs of those who plan to make the military a career. With budgets for active duty education programs already at the breaking point, the armed services need relief in that area as well. And that's the great, glaring weakness of the Webb plan.


Mrs. Davis said...

The GI Bill made sense for a conscription force, ill educated, in an economy that had been racked by depression, probably with some paid under minimum wage. While the service of those who protect our freedom should not be slighted, the economic transaction today should be considered in the context of a well educated, all volunteer force that must pay market competitive rates to retain highly competent personnel. The world has changed.

SMSgt Mac said...

Good Post.
I am also concerned with the possibility of promoting and creating factions among the veterans. Not too long ago, the less than Solomonic solution of restoring promised medical benefits to WWII era vets essentially created two distinct subsets of veterans. This smells like more of the same.

Consul-At-Arms said...

I've linked back to you here: