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OCR Page 1 of 61P HW
THE WHITE HOUSE
WASHINGTON
THE PRESIDENT HAS SEEN
April 7, 1972
ACTION
MEMORANDUM FOR: THE PRESIDENT
VIA:
JOHN EHRLICHMAN
FROM:
KEN COLE
SUBJECT:
Recomputation of Retired Military Pay and
Reform of the Military Retired Pay System
FOR DECISION: The legislative and political strategy for handling
subject issue.
BACKGROUND: In 1968, you issued a statement supporting recomputa-
tion of retired military pay. In the fall of 1971, in order to fulfill this
campaign promise, you decided to propose a one-time Recomputation of
retired military pay coupled with a proposal to Reform the military re-
tirement pay system. Both proposals were to be advanced simultaneously
to Congress this spring. The dual proposal, product of an interagency
committee chaired by Roger Kelley, Assistant Secretary of Defense,
would result in a net savings to the Federal Government of roughly $30
billion over 30 years. (Savings from Reform would be $44 billion, minus
a Recomputation cost of $14 billion.) (First year costs of $296 million are
already in the FY '73 budget.)
CURRENT SITUATION: The Recomputation legislation is ready to go, but
the Reform proposal is blocked because Secretary Laird cannot get the
military leadership's approval on the current form of the Reform proposal.
Laird has thus directed further study (which some view as a stall) that
will take at least six more months. With this delay, some feel we may
never get Reform legislation since the proposals have been known for at
least five months.
In short, we face mounting pressure and dissatisfaction from retired
military groups because the Recomputation legislation has not yet gone to
the Hill. As things stand now:
1.
Secretary Laird wants to submit the Recomputation legisla-
tion now, but delay sending the Reform legislation until it
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