Ready, Fire, Aim!!! Secretary of Defense Has No Idea What Expanding Benefits to Same-Sex Partners Will Cost DoD
Just a few months ago, Secretary of Defense Chuck Hagel and his predecessor Leon Panetta were pounding the table for TRICARE fee increases and pension reforms, arguing that over time, personnel costs would overwhelm the DoD.
Now the Secretary of Defense, having supported the repeal of the Defense of Marriage Act, has pledged to make the full range of lucrative benefits available to same-sex spouses of service members that are available to heterosexual married couples. These benefits range from the widely understood Tricare health insurance benefit to qualification for military housing, a significantly higher housing allowance (BAH Type II), free PCS moves and family separation pay.
So what’s this going to cost?
Well, the Secretary of Defense doesn’t know. Having advocated the policy change, the Administration had no idea what the fiscal effect on the Department of Defense was going to be.
The concern over the significant cost burden of paying benefits to the families of servicemembers is not new. In the early 1990s, then Commandant of the Marine Corps, General Carl Mundy, proposed saving money by prohibiting married individuals from joining the Marine Corps. This policy would have echoed the military practice of prior generations: In the 1950s, anyone below sergeant in the Army required the company commander’s permission before getting married.
As it stands now, the DoD estimates that there are about 17,000 military members with same-sex partners in marriages recognized by at least one state. That’s about a division equivalent.
You’d think that with the repeal of DOMA on the horizon for years, that the DoD or the Administration would at least come up with a ballpark budget-impact estimate. After all, local commands in the Reserve component have to come up with a cost-estimate worksheet just to hire a few people for a week to help prepare for an inspection.
The DoD, however, will apparently be blindsided by the cost of their own favored policy.
However, any cost estimate would have to include the difficult-to-predict impact that human responses to incentives will create. For example, how many gay troops over and above the 17,000 estimated will now get married in order to collect military benefits? Are there others who have not been identified? If the 17,000 estimate is low, then costs will be higher than projected. If they bothered to project them in the first place.
Will we see healthy partners of HIV-positive individuals join the military to give their partners access to Tricare benefits, and what will that cost? Will we see retired servicemembers come out and enroll their partners? Will we see same sex roommates engaging in sham marriages to get a higher BAH payout? How will we police that? Or will we?
A big part of the budget impact of the expansion of military benefits will have to do with how the DoD (and to a lesser extent, the Veterans Administration) defines what will and what will not count as a marriage for the purposes of DEERs enrollment. For example, will the DoD grant benefits to those servicemembers in domestic partnerships that aren’t formally marriages? If it does, will it grant the same benefits to heterosexuals in domestic partnerships? Will the state laws governing same-sex marriages have any bearing on the status of marriages within that state? How will the DoD treat servicemembers wishing to marry in states that do not recognize same-sex marriages? Will same-sex partners still have to show marriage certificates as heterosexual couples do in order to qualify?
The Broader Picture
To be fair, there are some early indications that the repeal of DOMA will cause a net increase in federal revenue, because of the marriage tax penalty that will be imposed upon married same-sex couples, and because married couples with combined incomes would be less likely to qualify for public assistance programs than two unmarried individuals with separate incomes. The Congressional Budget Office concluded in 2004 that same-sex marriage would have the effect of actually decreasing the federal deficit, because of these effects. However, this would not benefit the Department of Defense directly. To pay for these benefits, the DoD has a few options:
- Slash benefits across the board for all families to pay for the at least 17,000 new partners and counting.
- Increase TRICARE fees.
- Cut operational, maintenance, physical plant and spare parts budgets
- Cut a couple more brigade combat teams, ships, or aircraft programs or some combination of the three.
These cost saving measures are already well underway – prompted by the twin engines of a natural post-war cyclical drawdown and the additional requirements of sequestration. The DoD is already complaining that the sequestration requirements will force them to cut bone. The additional benefits paid will force further cuts in an already austere fiscal environment for the U.S. military.