Tuesday, May 7, 2013

The 27th Amendment Impacts Money Issues

Okay, here's your question: What is the 27th Amendment to the U. S. Constitution? Is that a blank stare I see on your face?  It was ratified on May 7, 1992 and probably isn't as well known as some other amendments.

It reads:
“No law, varying the compensation for the services of the Senators and Representatives, shall take effect, until an election of Representatives shall have intervened.”

In short, a sitting Congress can’t change its pay while it is in session for two years. But it can give the next Congress a raise. The amendment was proposed back in 1789 by James Madison along with other amendments that became the Bill of Rights, but it took 203 years for it to become the law of the land.

Members of the House and Senate are immune to pay cuts and furloughs, unlike many other government workers, because such cuts would change their pay while Congress is in session—in violation of the 27th Amendment.

Congress hasn’t seen a pay hike since 2009. Its members are now paid $174,000 per year on average.
If Congress had accepted a cost-of-living raise for the past four years, its average compensation would be $183,000 a year based on COLA estimates, or an 8 percent raise from 2008.

In March, some House representatives introduced bills that would cut the pay of the next Congress by at least 8 percent, an amount equivalent to the cuts to other workers’ pay triggered by the sequester. In April, Don Barber, a U.S. House representative from Arizona, pushed for a 20 percent pay cut for Congress in its next term.

Despite Congress’ low approval ratings, not everyone thinks Congress deserves a pay freeze or pay cut. One person who endorsed a small pay raise for Congress was President Obama, who signed an executive order late last year that gave House and Senate members a 1 percent raise as part of hike for federal workers. Just as they do for everything the President proposes, Congress rejected the offer.

Time will tell whether the sequester, budget battles and other congressional issues impact views on compensation for legislators.

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