WASHINGTON

BUDGET PROPOSES $250,000 MILITARY DEATH BENEFITS

President Bush will propose a dramatic increase to $250,000 in government payments to families of American troops killed in the Iraq and Afghanistan wars and in future combat zones. The plan to increase the tax-free “death gratuity,” now $12,420, to $100,000 and provide an extra $150,000 in life insurance payouts will be part the 2006 budget proposal submitted to Congress next week, said David Chu, the Pentagon’s personnel chief. Veterans groups and many in Congress have been pushing for such increases. “We think the nation ought to make a larger one-time payment, quite apart from insurance, should you be killed in a combat area of operations,” Mr. Chu said. “We can never in any program give someone back their loved one,” he added. “There is nothing we can do about the hurt, to make it go away. But we can make your circumstances reasonable, in terms of finances.” Mr. Chu is to unveil the administration’s full proposal in congressional testimony today. In addition to the higher gratuity, the Pentagon would substantially increase life insurance benefits, Mr. Chu said. The death gratuity is a one-time payment intended to be given to the family immediately after a service member’s death; it is separate from an array of other survivor benefits such as housing aid.

– Associated Press

BUDGET OFFICE: IN 2020, SOCIAL SECURITY WILL START LOSING MONEY

The Social Security system will take in more money annually than it pays out in benefits until 2020, two years later than earlier estimated, the Congressional Budget Office reported yesterday in a modest change unlikely to alter the growing political debate over the program. Congressional budget analysts also estimated the program’s trust funds will be depleted in 2052, “meaning that beneficiaries will be able to count on receiving only 78% of their scheduled benefits beginning then,” analysts said. “After the trust funds are exhausted, Social Security spending cannot exceed annual revenues,” the analysts added. “As a consequence … benefits paid will be 22% lower than the scheduled benefits.” In both cases, the CBO estimates are more optimistic than the most recent projections made by the Social Security Board of Trustees. In the annual report it issued last March, the board said annual income would fall behind benefit payments beginning in 2018, and the trust funds would be empty in 2042. President Bush has cited the trustees’ estimates as evidence of a need for legislation to place Social Security on a permanently stable financial footing. The president also wants to give younger workers the option of setting aside a portion of their payroll taxes into personal retirement accounts. Aides have also indicated the administration may propose reducing the starting benefit for future retirees by as much as 40%.

– Associated Press

DEAN WINS BACKING OF STATE DEMOCRATIC LEADERS

Howard Dean won the backing of state Democratic Party leaders yesterday, putting him in a strong position to win the chairmanship of the Democratic National Committee. “If all of our members vote for him, that will be half of what he needs to win the chairman’s job,” said Mark Brewer, chairman of the Association of State Democratic Chairs. The party’s presidential front-runner in 2003 won 56 votes from the state chairs and Democratic activist Donnie Fowler won 21 during a national conference call yesterday. The state leaders ignored a recommendation made Sunday by the executive committee to back Mr. Fowler. Support for several other DNC chairman candidates from the state Democratic leaders yesterday was in single digits. “We’re asking all of our state chairs and vice chairs to follow our endorsements,” Mr. Brewer said, noting that would bring 112 votes. “And we think they will.” Dr. Dean, the former governor of Vermont, will bring changes the state parties have asked for, said Mr. Brewer. Dr. Dean revolutionized Democratic politics in the 2004 presidential campaign with his use of the Internet, organizing strategy, and his ability to energize new voters.

– Associated Press

EAST

CODEY WILL NOT SEEK FULL GOVERNOR’S TERM

TRENTON, N.J. – Citing family obligations and a need to focus on the business of state government, acting Governor Codey said yesterday he will sit out the gubernatorial race, eliminating the prospect of a divisive Democratic primary fight. Mr. Codey announced his decision at a statehouse news conference, during which he also endorsed the candidacy of Senator Corzine. “After much deliberation, I have determined that a run for governor is not in the best interests of my family, my fellow citizens, and my party. God knows, this has not been an easy decision for me to reach,” said Mr. Codey, flanked by his wife, their two sons, and a throng of party leaders. Mr. Codey’s move to the sidelines leaves a clear path to November’s general election for Mr. Corzine, the first-term senator and former Wall Street executive who is the only declared Democratic candidate. Seven Republicans are running in the June 7 primary. During his news conference, Mr. Codey said he and Mr. Corzine had spoken about the decision. Mr. Codey said no “deal” was discussed. If Mr. Corzine wins election as governor, he would appoint his own successor in the Senate.

– Associated Press