Perks for Past Presidents Potentially Pruned

In a little-heralded move that was lost in the Friday afternoon news dump where important information typically goes to die in Washington, D.C., something verging on the miraculous occurred in the nation’s capital.

Congress agreed, in a broad bipartisan fashion, to cut future spending.

On Friday, July 8, 2016, the House of Representatives, without objection, passed H.R. 1777, the Presidential Allowance Modernization Act of 2016, which had been introduced by House Oversight and Government Reform (O&GR) Committee Chairman Jason Chaffetz (R-Utah) on April 14, 2015.  House passage followed Senate approval on June 22, 2016 of a companion bill, S. 1411, which had been introduced by Sen. Joni Ernst (R-Iowa) on May 21, 2015.

According to the Congressional Research Service, funding for former presidents dates back to the 1958 enactment of the Former Presidents Act (FPA), which was intended to “maintain the dignity” of the presidency, especially in retirement.  Before that time, former presidents received no pension or other federal assistance, to include any funds for informal public duties often required of a former president.  In fiscal year (FY) 2015, former U.S. presidents cost taxpayers more than $2.4 million in travel, office space, communications, personnel, and other expenses.  According to the OG&R Committee’s website, for FY 2016, the General Services Administration “estimates it will spend $3.2 million [for FY 2016] for former presidents who receive a pension equal to the pay for the head of an executive department, funds for travel, office space, support staff, and mailing privileges.”

The Presidential Allowance Modernization Act, if signed by President Obama, will accomplish several objectives, including setting former presidents’ pensions at $200,000 per year and increasing the annual survivor benefit for each surviving spouse to $100,000 from the current $20,000 per year.  The bill also caps the annual monetary allowance at $200,000 for costs such as travel, staff, and office expenses often associated with post-presidential duties.  More significantly, the bill reduces perks on a dollar-for-dollar basis for every dollar earned by a former president in outside income of more than $400,000 per year.  For example, if a former president earns $450,000 in outside income, his official expense allowance of $200,000 will be reduced by $50,000 (the amount of income in excess of the cap) to $150,000.

While the president’s pension (even for independently wealthy former presidents) will not fall below $200,000 per year, nor will funding for the security or protection of a former president be affected, it is certainly reasonable to expect that the taxpayer burden for official post-presidency expenses might be offset completely.  Consider the following statistics provided by the Independent Journal regarding the net worth of the living former presidents:  Jimmy Carter, $5 million; George H.W. Bush, $25 million; George W. Bush, $35 million; and the “formerly dead-broke” Clintons, $110 million.  According to the same source, the Obamas’ net worth is reported to be $12.2 million, before any lucrative post-presidency speaking fees and other income kicks in.

Earlier in the week during which the bill was passed, Chairman Chaffetz and Rep. Elijah Cummings (D-Md.), the committee’s ranking Democrat, were finding little in common, especially during the interrogation of FBI Director James Comey in the aftermath of the latter’s decision not to forward any prosecution recommendation to the Department of Justice in the case of former Secretary of State Hillary Clinton and her handling of classified materials.  However, by the end of the week, Chairman Chaffetz and Ranking Member Cummings, who had co-sponsored H.R. 1777, issued the following joint statement:

“We are pleased this important legislation is on its way to the president to finally become law.  The bill updates an outdated law and saves taxpayers money.  Upon leaving office, most presidents go on to make millions of dollars and are not in need of taxpayer subsidies.  This bill reforms government and ends an unnecessary expense on the American people.”

For her part, Sen. Ernst applauded the House passage:  “With our nation drowning in $19 trillion in debt, we must tighten our belts and find ways to cut wasteful spending.  The millions in expenditures and subsidies in presidential perks do not line up with the realities of post-presidential life.  The Presidential Allowance Modernization Act removes the unnecessary and outdated presidential perks and better reflects the spending needs of our time.”

After Friday’s congressional action, the bill was sent to President Obama for final signature.  Hopefully, the fact that the legislation will apply to him when he leaves office on January 20, 2017 will not preclude him from signing it into law.