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Hi,

Your article about the DRAFT was an eye opener for me.

Did I read the article correctly (I read it 3 times in fact): Benefits
for retired military people were changed from what they signed up for.

I am not a lawyer but I thought once you signed a contract you had to stick with it, both sides. But the way I read your article a guy who signed up in, say, 1973 and retired in 1995 would receive benefits based NOT on 1973 or even 1995 but whatever happened to be on offer Today.
This doesn't make sense to me. If you signed up in '73 you should get what you signed up for in '73. If some other guy signed up in '87 then he gets what he signed up for in '87, and so on and so forth.

I've asked four other people to read your article and they are just as confused as I.

A simple reply is all I need. Either a YES they get what they signed up for in '73 or NO they get what's on offer today.

Thank you very much.

Glenn
Glenn,

You're making the same mistake that many people make. You think there is something in the enlistment contract that guarantees benefits. If you dig your contract out of the trunk <grin>, and read it, you'll find it guarantees nothing at all.

Military benefits are not an entitlement of a contract, but are rather authorized under the law. The law can be changed at anytime there are enough votes in the House and Senate to change it.

The first change to military retirement benefits happened in the early 80s. This change mandated that instead of receiving a percentage of base pay at the rank the person held when retired, that retirement pay would be based on the average of the last three paygrades the individual held. When the law was passed, those with over 10 years of military service were "Grandfathered." Those with less than 10 years of service fell under the new law.

The next change, changed retirement so that, when retiring at 20 years, one received only 30 percent of their pay until turning age 62, when it would revert to 50 percent. All on active duty at the time of the change were "grandfathered," during that change.

Free medical care for retirees were "promised," however, now retirees fall under TriCare, and must pay $400 per year, plus co-pay for each doctor visit. Several veterans filed a lawsuit, which was decided by a Federal appeals court last week. The court held that it didn't matter what was "promised," Congress could change the law at any time it saw fit (which they did, five years ago).

The G.I. Bill is another example. My Vietnam-era G.I. Bill has automatically converted to the McGomery G.I. Bill (the conversion happened in the 80s), which pays less. I also must use my G.I. Bill within 10 years of separation/retirement, even though when I first joined, it was for "life."

I could go on and on about changes from my original "contract." The point is, there is no contract. Benefits received are up to Congress/Senate, and they can/will change the laws anytime they think it is beneficial to do so.

Rod
Rod:
In scanning your article about the draft I found -

your statement - Commissary and Base Exchange prices were
raised so that their civilian counterparts could remain ompetitive."
That is incorrect.

I was the Military Sales Manager for the Mennen
Company for 15 years.We sold Skin Bracer, Speed Stick, and other items to the exchanges and commissaries. The Commissaries are part of the defense budget. They sell all items at cost If they buy something for $1.00 they sell it for
$1.00. There is a surcharge - I think it is 3%. That is to cover the cost of the building maintenance.

The Commissary system was set up, years ago, when the bases were out in the boondocks, to provide necessaries to military families.
The commissaries sell - mostly groceries, and a few health and beauty aids, toothpaste, shaving cream, like that.

The Army and Air Force Exchange System (AFFES) is unique. It is different that any other business in the world. It is NOT owned by anyone. Profits are used to provide, on base services for military personnel. Movies, golf course, swimming pools,
etc. The exchanges sell - everything but groceries.

The Navy, and Marine Corp have their own exchange system. But it operates like AFFES.

Most Food and H&BA corporations have a special sales force that sell exchanges and commissaries. Also, there are Military Brokers that call on Bases and rep companies that don't want to have a special sales force.

Are these necessary? Not any longer. They were established when the bases were out in the boondocks. But, now the towns have grown up around the bases and provide all necessary retail
services.

Why hasn't it been abandoned? Profit.Profit to the companies that sell the Commissaries and exchanges.

It is a very specialized business. To sell the commissaries
items must be listed in a Procurement guide. ONLY items listed case be purchased. An item can NOT be listed until 6 commissaries stock the time. No commissary can stock an item until it is listed.Catch 22. That was what I did. I knew how to follow their guidelines and get ouritems listed.

Cigarettes are special. Since the Commissaries HAVE TO - BY LAW - sell atcost. They now buy their cigarettes from the
exchanges, instead of directly from the cigarette companies. That was how they got around the priceraise, a couple of years ago, when there was allthat flack about - the military being able to buy
the cigarettes at a lower price. Which encouraged smoking.

ONLY Active duty or retired military personnel can buy at a commissary or exchange.

In CRations - which were boxes of food given tofront line troops before mess halls were erected -each CRation contained a small 2 or 3 pack of cigarettes.

I can not vouch for this, but I have heard, that Coca Cola had a portable bottling plant that went ashore during invasions, in the 2nd, or 3rd wave. Coke sold the Defense department - nothing makes a soldier feel more at home than a bottle of Coke.
Sounds fair. After the war these portable bottling plants were converted to permanent plants. Walla - Instant World Wide distribution of Coke.

Ken
Ken,

I know very well how the commissary and Base Exchange System work, and stand by my statement <smile>.

By law, the commissary must resell for the same price it purchases items for (with a five percent markup).

However, the cigarette price-setting you mentioned above is my case-in-point (as far as commissaries go). The commissary service arbitrarily decided to jack up the price of cigarettes without the permission of Congress, and in order to do so, sought a more expensive supplier. Now that the precidence is set, they are free to do so on any item they wish. If the commissary arbitrarily decides that red meat is bad, they may search for a more expensive supplier. The same for sugar, the same for any food item. Because the commissary has, without the permission or authority of Congress, decided on their own that they can set their prices to meet their own goals, simply by choosing who their supplier will be, means they artificially raise the price.

The Base Exchange Service makes a "profit," to be used for other MWR uses, sure. However it sets it's profit by surveying local businesses for "like" items, and setting the price accordingly. Cigarettes are one example. BX's buy cigarettes without any State or Federal tax, at about $3.00 per carton, and resell them for $20.00 per carton.

Gasoline is another example. The BX also does not pay state or federal taxes on gasoline purchases. It buys gas at about 20 cents per gallon, and resells it for a penny or two below the local off-base rate. Alcohol is another example. Again, no local or federal taxes, but alcohol is sold for the same price as it is off base.

The same goes for anything the BX sells. No matter how cheap the BX buys the item for, they will set the resale price to be just a few dollars below the off-base like item in order to maximize the "profit."

Although the Commissary/BX may have been originally designed because of remote locations of bases, they have been actively advertised as a valuable military benefit for the past several years. My point is, it not not such a benefit.

The last time I shopped at the commissary at Offit AFB, which is about 100 miles from my house, my shopping bill (over $200) was only a couple of dollars cheaper than when I shop here in town for the exact same items. Give a couple of bucks to the baggers, and it was about the same.

Rod
Rod

>>> Can't really call AAFES a "more expensive supplier"<<<

The decision to raise the price of cigs was in response to an outcry to make the commissaries Stop selling cigs all together.

There has been a movement for years,I was outspoken about it - even when I was selling the Military - to close the commissaries.
They are no longer needed. AAFES had a contingency plan to run them if/when the commissaries are shut.

>>Now that the precidence is set, they are free to do so on any
item they wish.<<

That is kind of a stretch.

>>If the commissary arbitrarily decides that red meat is bad,
they may search for a more expensive supplier. The same for sugar, the same for any food item. Because the commissary has, without the permission or authority of Congress, decided on their own that they can set their prices to meet their own goals, simply by choosing who their supplier will be, means they artificially raise the price. <<

What is artificial about raising a price?
Don't get your point.

>> The Base Exchange Service makes a "profit," to be used for other MWR uses, sure. However it sets it's profit by surveying local businesses for "like" items, and setting the price accordingly.
Not so.
Their prices are set on a standard markup that the board sets.
>>Cigarettes are one example. BX's buy cigarettes without any State or Federal tax, at about $3.00 per carton, and resell them for $20.00 per carton.<<

NOT SO.
AAFES buys cigs at the same price as everybody else.
I use to do stocking work for Commonwealth brands.
The 2nd largest cigarette retailer in the US is in La$ Vega$.
It is the store on the Indian reservation - down on Main Street.
They ALL pay the same thing for cigs.

AAFES is NOT covered by the
Robinson Pattman Act.

>>Gasoline is another example. The BX also does not pay state or federal taxes on gasoline purchases. It buys gas at about 20 cents per gallon, and resells it for a penny or two below the local off-base rate. Alcohol is another example. Again, no local or federal taxes, but alcohol is sold for the same price as it is off base.<<

Never sold anything thing that had a tax sticker on it, so I don't know about alcohol or tobacco.

Question -
why do they make a profit?
Who gets the profit?
They have no shareholder, or owners, or partners.

>>The same goes for anything the BX sells. No matter how cheap the BX buys the item for, they will set the resale price to be just a few dollars below the off-base like item in order to maximize the "profit."

No reason to maximize "profits".

>> Although the Commissary/BX may have been originally designed because of remote locations of bases, they have been actively advertised as a valuable military benefit for the past several years. My point is, it not not such a benefit.<<

Of course it is a benefit.
I did not have Comm privileges but I checked the price of
Frozen Grapefruit juice we were on a grapefruit juice diet.
The cheapest in LV wa 1.25 the comm at Nellis AFB sold it for .89.

>>The last time I shopped at the commissary at Offit AFB, which is about 100 miles from my house, my shopping bill (over $200) was only a couple of dollars cheaper than when I shop here in town for the exact same items. Give a couple of bucks to the baggers, and it was about the same.

Not so.
Are you retired Military?
Must be if you shopped at Offit, I know what Walmart sells Mennen Items for and I know what Nellis Comm
and BX sells Mennen Items for Comm are cheaper - same as their cost BX next lower Walmart next.

I hope you don't shop at the comm
I hope they close them.


Ken

Ken,

Let me try and respond to many (most?) of your points. First, yes, I'm retired military. You can read my bio at
http://usmilitary.about.com/mbiopage.htm. In my many years as an Air Force first sergeant, I've lost count of the number of AAFES and Commissary Advisory Councils I've been a member of. I know how the system works.

The BX *does* make a "profit." The profit is used by other MWR activities throughout the services. The more "profit" made, the more money that is made available for these activities, therefore the greater motivation to make a "profit."

The AAFES council sets its "markup," *NOT* based on what the item cost them, but based on what the item costs in non-AAFES Facilities. In other words, AAFES does NOT say, "Let's make a 20 percent markup," they say instead, "We buy toilet paper for 20 cents per roll, and the average off-base price for toilet paper is 60 cents per roll, so we'll sell ours for 55 cents per roll." The "markup" is determined by the offbase competition price, not a "reasonable" markup from the price of purchase.

You can't take a single commissary item which you found cheaper, and then speculate that all commissary items are always cheaper than like items off base. In my case, by the time I paid the 5 percent surcharge, and a four dollar tip to the bagger, my $200 worth of groceries from the commissary were not significantly cheaper than what I pay here in town. (Probably about $10.00). Certainly not worth the gas I had to pay to drive the 100 miles.

AAFES does not pay any Federal or State Taxes on cigarettes or alcohol or gasoline purchased. Period. State and Federal Taxes on cigarettes equate to over $1.00 per pack.

Although I don't see the BX's and commissaries as much of a benefit, I don't wish to see them closed, because they *ARE* needed. We have several bases like Edwards AFB, where Base Housing is on-base, 37 miles away from the nearest town (Lancaster, CA). We also still have plenty of bases overseas, in places like Korea, where meat is sold off base in open-market, unrefrigerated stalls, and where any item made in American bought downtown costs 7 times as much as they do in the States.

Have you ever used Korean toilet paper? Or, have you ever had to drive 40 miles to go shopping after a 16 hour workday? If you had, you wouldn't be so quick as to try and take AAFES/Commissaries away from our troops.

Rod

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