Mr. Coble Departs Washington, Pension Reform Dream Denied

NEW YORK (TheStreet) -- Many campaign for office stating the "government should be run more like a business," but U.S. Rep. Howard Coble (R-NC) has actually focused his career on having generous congressional pensions more resemble those being forced on American workers at companies such as Boeing (BA), General Motors (GM), Bank of America (BAC) and others. 

In an exclusive interview with TheStreet in his office in the Rayburn House Office Building, Rep. Coble explained why he has taken this path less traveled during his tenure in office, which ends this year.

The timing could not have been better for an interview with the premier foe of the U.S. Congress' pension system. That day's Washington Post contained an editorial warning more cities and states would suffer the fate of Detroit if civil service pensions aren't reduced. For Coble, addressing this fiscal problem is "a matter of a pledge I made in my run for Congress. One of the complaints of those in my district was the lavish, overly generous pension plans for members of Congress."

"A calculation was made that I have given up about $2 million in potential pension benefits," Coble added.

As a state legislator in North Carolina, Coble also refused to participate in the pension plan.

"It just seems unfair to the taxpayer to have them pay a pension after a politician has retired," Coble said. "There is only one other pension plan that I know of that is more generous than that for a member of Congress," he said. "That is for a major league baseball player."

As the chart below shows, more and more major American corporations are greatly reducing the pensions they pay to workers. There has been a tremendous shift from defined benefit plans, where a fixed payment is received, to defined contribution programs, such as a 401(k). Since 1998, Fortune 100 companies offering defined benefit plans has fallen from around 90% to about 30%, at present. Firms such as IBM (IBM), Home Depot (HD), General Electric (GE), Walgreens (WAG) and others are using The Affordable Care Act, or ObamaCare, to reduce their retiree health care obligations.

Company

Change

Bank of America

Froze plans; shift to Defined Contribution

Boeing

Replaced Defined Benefit with Defined Contribution; froze benefits

General Electric

Shifted into Health Insurance Exchange

General Motors

Closing plans; buyouts

Home Depot

Shifted into Obamacare exchanges

IBM

Shifted into Obamacare exchanges

Walgreens

Shifted into Obamacare exchanges

Source: Pension Rights Center, other sources.

Because he refused to participate in the congressional pension program, once Coble retires he will not be eligible to continue his health benefits and will have to get his own health care coverage like everyone else. 

"During my first term in Congress, others would come up to me on the floor of the House and say, 'Shut up and stop talking about this. It is not a good issue,'" he said. "But I would tell them that it was a pledge that I made to the voters and that I would honor it."

Coble has introduced his legislation for congressional pension reform every Congress since first being elected in 1984.

"Over the years, I have revised it to attract more support," he details. "The latest bill, HR 2537, seeks to extend the vesting period from five years to 12 years. That means a United States Senator would have to serve two terms and a Representative would have to serve six terms. Even with that change, congressional pensions would still be better than the federal government and certainly for those in the private sector."

Even with the changes, Coble's bill has not received any support in this Congress.

"I guess I was naive. I thought I would pick up 20-25 co-sponsors. But not even a nibble," Coble laments. For Tea Party supporters, it would seem to be a natural issue. But none have jumped on board to support HR 2537. Shaking his head, Coble said, "I think our Founding Fathers would have enthusiastically embraced our pension reform bill."

During his time in Congress, Coble twice declined the opportunity to join the pension plan, an action that had little effect on his colleagues in the House when it came to his bill. "Of all the years that I have introduced the bill, there was only one subcommittee hearing. But it did not move past that," Coble notes.

Coble chairs important subcommittees and serves on five subcommittees of the Judiciary and Transportation and Infrastructure Committees. So he has general political support. A former Captain in the Coast Guard, active duty and reserves, Coble's military service also plays well in Congress.

Over the decades the issue of pension reform has become a hallmark of Coble's, which suits him fine.

"Back in 2004 we had a debate in my district. A female from the audience thanked me for my doing what I could to reform congressional pensions. My opponent, Will Jordan, jumped up and grabbed the microphone and said, 'He doesn't need the pension because he's never going to retire.' That was a great line that broke up the house!" Coble remembers.

Coble leaves Capitol Hill in January 2015.

There has been no interest by either congressional colleagues or even those running for office in continuing with the issue. No United States senator has ever attempted to advance the issue.

"That is a shame," Coble wants all to know. "The American taxpayer pays enough in salary and benefits that a lavish, overly generous pension program for retired Members of Congress is just not fair."

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 This article was written by an independent contributor, separate from TheStreet's regular news coverage.

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