George W. Bush knew exactly what he was going to do as an ex-president: make “ridiculous money” on the lecture circuit, he said, to “replenish the ol’ coffers.”
He sure did: more than 200 paid speeches so far, at typically $100,000 to $175,000 a pop, not to mention a reported $7 million for his memoir “Decision Points.”
He’s not alone among ex-presidents with gilded nest eggs piled up in post-White House earnings from the speaking circuit, publishers and the like. And one other noteworthy revenue source: taxpayers.
Did Bush really need the $1 million he took in from federal coffers in 2015, according to the Congressional Research Service? That figure included his $200,000 annual pension, $96,000 for staff, $102,000 for staff benefits, and $434,000 for office space.
Many don’t think so. Just months out of office, Barack Obama offers the latest confirmation of the virtually guaranteed riches enjoyed by modern ex-presidents: He and his wife, Michelle, have already signed a book deal worth a reported $60 million. So doubts about whether presidential pensions are still necessary seem likely only to grow.
Cato Institute Vice President Gene Healy, author of “The Cult of the Presidency: America’s Dangerous Devotion to Executive Power,” said it was “absurd” for taxpayers to cover lifetime office expenses and free mailing privileges for exceptionally wealthy people. Ordinary Americans, after all, see their access to many federal benefits limited by their own means. And by the way, their retirement savings are typically paltry if not nonexistent.
“You could argue that the cost, $4 million or so a year, is chump change in a $4 trillion federal budget,” Healy said, referring to all five living ex-presidents, “but we’re chumps for allowing it.”
In a rare moment of bipartisan agreement, Congress approved legislation in 2016 that would have capped presidential pensions at $200,000 per year and staff, travel and other expenses at another $200,000. Future increases for both would be tied to those given Social Security recipients.
And it also applied a limited form of means testing, stipulating that every dollar a president earned in outside income above $400,000 would result in a one-dollar decrease in the expense allowance, excluding costs for security.
But Obama vetoed that measure -- one of only 12 vetoes during his presidency. His own financial stake in the matter drew little comment at the time.
In his message accompanying the veto, he said he agreed with the “goal” of reforming payments to ex-presidents, but claimed this bill would “impose onerous and unreasonable burdens on the offices of former Presidents.”
The bill’s chief sponsors, Rep. Jason Chaffetz (R-Utah) and Sen. Joni Ernst (R- Iowa), vowed to reintroduce the measure, though Chaffetz has since said he will resign from the House. Their hope is that President Trump, who has committed to donating his salary or giving it back to the Treasury, will be more receptive (his first quarterly check went to the National Park Service).
Larry Sabato, a political scientist at the University of Virginia who has long advocated for presidential pension reform, said the payments make little sense now that “each ex-president is a mini-corporation, guaranteed to be very profitable.”
While critics increasingly claim that Washington is out of touch with ordinary Americans, Sabato said “presidents are in a class all their own,” and that the “handouts” should be reduced because “everything about the presidency takes on larger symbolic meaning.”
Most presidents enjoyed great wealth even before they were elected to office.
According to 24/7 Wall Street, George Washington’s net worth, based on extensive land holdings and his marriage to the wealthy widow Martha Custis, was roughly $580 million in 2016 dollars. Honest Abe Lincoln, the rail splitter born in a log cabin, was a very successful corporate attorney. John F. Kennedy, son of one of the nation’s richest financiers, former SEC chairman Joseph Kennedy, had a fortune that would be worth more than $1 billion today.
Some former presidents, however, did leave office in dire financial straits. “James Monroe came close to dying a pauper,” Healy said. “In order to leave something behind for his family, Ulysses S. Grant had to rush to finish his memoirs as he was dying of oral cancer.”
Industrialist Andrew Carnegie proposed to privately fund a $25,000 pension for former presidents in 1912 so they could “spend their latter days free from pecuniary cares in devoting the intimate knowledge they have gained of public affairs to the good of the country.”
President Theodore Roosevelt, who was already a wealthy man, rejected the offer, saying he wasn’t interested in pensions for ex-presidents, but wanted pensions for “the small man who doesn’t have a chance to save.”
Congress considered a publicly funded pension in the 1920s, but never acted on the idea.
Sentiment changed in the 1950s, when it became widely known that former President Harry Truman, who refused offers to serve on corporate boards or give paid speeches, was in financial difficulty.
In his biography of Truman, David McCullough wrote that when Truman left office in 1953, "he had no income or support of any kind from the federal government other than his Army pension of $112.56 a month. He was provided with no government funds for secretarial help or office space, not a penny of expense money."
But Healy says Truman’s tax records show he really wasn’t as bad off as his biographers, and historians, like to think.
“In his worst post-presidential year, 1954,” Healy said, Truman “made more than four times the median income, and by 1955, he was pulling down over $100,000.”
Indeed, Truman sold his memoirs to Life magazine in 1953 for $600,000 – worth $5.4 million today.
Nevertheless, Congress established the first presidential pension in 1958, The initial amount was $25,000 per year – worth roughly $212,000 today. Truman, who died in 1972, and Herbert Hoover, who lived until 1964, were the first pensioners.
The legislation also gave pensions of $10,000 per year to widows of former presidents. The first two to receive payments were Eleanor Roosevelt and Edith Wilson.
The pension, however, became all but unnecessary just a few years later. Richard Nixon cashed in big-time on the office – in his case, an office he left in disgrace – by agreeing to a TV interview with David Frost in 1977 for at least $600,000 (about $2.4 million today).
The modern ex-presidential gold rush got under way in earnest, in the view of many, after Ronald Reagan left office in 1989 and soon commanded a reported $2 million for two speeches in Japan, on top of $7 million for his memoirs.
But few former presidents have made as much as Bill Clinton.
Tax returns Hillary Clinton released in advance of her bid for the 2008 Democratic presidential nomination, covering the years 2001 through 2006 and estimates for 2007, showed the former president made $51.8 million from speeches, and an additional $29.5 million from advances and royalties on two books.
By the time Clinton announced her second White house bid in 2015, Bill and Hillary combined earned more than $153 million from paid speeches over a 14-year period. Critics attacked the arrangements as selling influence, since much of that time Mrs. Clinton was secretary of state or a serious presidential contender or both.
While Sen. Ernst has yet to reintroduce her presidential pension reform bill, three pending House bills tackle congressional pensions. (Unlike former presidents, former members of Congress do not receive special benefits.)
Any action on presidential pension reform, however, depends in part, on whether the nation’s current billionaire president is willing to get involved.
As a candidate, Donald Trump discussed pay and pensions for Congress on the campaign trail, telling a crowd at a New Hampshire campaign stop that he would not accept the job’s $400,000 per year salary.
“That’s no big deal for me,” Trump said.
Responding to a question about congressional pensions, Trump said that "when these guys go to Congress, as per your question, when they go to Congress, a couple of things happen. First of all, they get benefits that nobody else can even think about, OK? And they don’t like to talk about it. But we’ll work on that."
RealClearInvestigations contacted the White House press office for comment on this and presidential pension reform, but has received no comment.
For the most recent former president, whose net worth is estimated at $20 million, the book deals and speaking fees may not be the end of his financial ambitions.
In a 2015 interview with GQ magazine, Obama said he would “absolutely” like to be a part owner of a professional basketball team, saying he had “fantasized about being able to put together a team and how much fun that would be.”
In March, Dallas Mavericks owner Mark Cuban told TMZ he would sell Obama a 10 percent ownership stake in the team for $300 million.
For pension critics like Healy, Obama’s hoop dreams are additional proof the time has come to end the handouts.
“As for ‘maintain[ing] the dignity’ of the presidential office, the original rationale behind the ’58 Act—that ship has sailed,” Healy said.
“Presumably, a future ex-president who’s down on his luck could always take a gig as a contestant—or host—on ‘Celebrity Apprentice.’”