Every year or so, the Congressional Budget Office [CBO] releases a report to Congress with options to reduce the Federal deficit. As our current deficit is nearly $800 billion (deficit, not the national debt which is much crazier number in the trillions) this has aroused a lot of eyes on what the CBO releases. This past December, the budget gurus released their report and buried within was some troubling ideas to reduce VA disability benefits, and more specifically a “means-test” idea. This means-test would reduce the disability payment as it relates to the wages of the veteran. For example, if the veteran makes $125k a year in salary or hourly wages, the disability payment would be reduced by a certain percentage. If the veteran earns more than $170k, no disability payment would be awarded.

Another idea being suggested by the CBO is to begin taxing veteran disability benefits. This would, in effect, reduce the overall disability payments by a considerable amount, depending on the monthly payment. This would impact the quality of life substantially, especially for those who depend on this monthly stipend to survive.

Side note, VA Secretary McDonough has committed to zero cuts and confirmed this in an article by Military.com. But Bush Sr. said no new taxes too….and we live in extraordinary times.

Let’s get to the bottom line. How much would this means-test save Uncle Same over a 10 year period? It would save $253 billion or $25.3 billion per year. To put that in perspective, for FY 2024 we have earmarked $63.1 billion for “foreign assistance and diplomatic engagement” (USAID, 2023). We also earmarked $32 billion “in foreign assistance for USAID fully- and partially-managed accounts” (USAID, 2023). In 2021, according to the US State Department, we spent $8.9 billion for “International Security Assistance” which includes $6.175 billion in “Foreign Military Funding [FMF]” (US State Dept, 2023). Finally, in FY 2021, for “Bilateral Economic Assistance” we spent $24.8 billion which includes but is not limited to:

• $9.2b – Global Health Programs
• $4.4b – International Disaster Assistance
• $3.5b – Development Assistance [DA]
• $3.2b – Economic Support Fund [ESF] 

Maybe it is just me, but perhaps we are looking at the wrong areas to cut? I know what you are going to say, but the CBO puts out this report every year and it goes nowhere. If it was 2018, I’d say you’re right. However, we are in some tight economic times and with our national debt spinning out of control and record inflation, cuts will come and they are coming for veterans. Believe me or not, mark my words, they are looking to cut. But there are other places to find it.

I found a fancy infographic at the CBO and I’d like to point your attention to the portion that reads “Corporate Income Taxes”. Check it out, I will wait.