Murray hasn't endorsed any specific plan for change. | John Shinkle/POLITICO Murray backs off military pension cut

Sen. Patty Murray is distancing herself from a cut in military pensions in the budget deal she brokered with Rep. Paul Ryan.

Her unease about a key element of her own deal, which passed the Senate on Wednesday and is now headed to President Barack Obama, comes amid a backlash from veterans groups and Senate defense hawks that has put her and her colleagues in a tough spot going into an election year.


Murray’s response: The pension cut isn’t final.

“We wrote this bill in a way that will allow two years before this change is implemented so that Democrats and Republicans can keep working to either improve this provision or find smarter savings elsewhere,” she said on the Senate floor this week.

( PHOTOS: Senators vote on budget deal)

“In other words,” she added, “we can and we will look at other, hopefully better ways to change this policy going forward.”

Her stance provides a major opening for opponents of the cut to work to get it tossed out or replaced with alternate savings — an effort that could weaken the budget deal and force vulnerable senators to continue defending their support for an agreement that would provide sequester relief for federal agencies at the expense of veterans.

“We’re probably going to lose this fight, but we will win the war,” Sen. Lindsey Graham, who voted against the budget deal, declared to a group of veterans on Tuesday — vowing to take this fight into the next year.

( PHOTOS: Paul Ryan through the years)

The South Carolina Republican won’t face much resistance from Murray, who left her perch this year as chairwoman of the Veterans’ Affairs Committee to lead the powerful Senate Budget Committee. The Washington state Democrat made clear on the Senate floor this week there is time to replace the pension cut before it kicks in at the end of 2015, though she hasn’t endorsed any specific plan for change.

She’s also promising a “fix” next year that would exempt all disabled veterans. And at least one person close to the issue is pointing a finger at Murray’s Republican counterpart, the chairman of the House Budget Committee.

“This was something that Ryan pushed for,” said a source close to the negotiations, discussing the issue on the condition of not being identified.

( Also on POLITICO: Senate passes budget deal)

Ryan’s backing of the provision would make sense, given that he’s long called for major reforms to federal pensions. But an aide to the Wisconsin Republican sidestepped the question on Wednesday, noting the two budget committee leaders both agreed to the terms of the deal.

Under the two-year agreement, working-age military retirees would see their pensions increase at a slower pace, with their cost-of-living adjustments pegged to the rate of inflation minus 1 percentage point. Once they turned 62, they would go back to receiving adjustments pegged to the full rate of inflation.

The provision, expected to save about $6 billion over the next decade, has sparked outrage among Senate defense hawks — some of them facing tough reelection battles. It has also mobilized powerful advocacy groups for service members and veterans, including the Military Officers Association of America, which contacted every Senate office this week with a blunt message: Don’t single out those who’ve sacrificed for their country.

Behind the scenes, though, some are celebrating the pension cut as an unexpected victory. The defense industry, in particular, stands to gain from the deal, which would provide $63 billion in sequester relief over the next two years, split between defense and nondefense programs.

For the industry, the agreement represents a first step in reining in the military’s personnel costs — which have risen dramatically over the past decade, along with the rest of the defense budget, eating up funds defense companies would rather see spent on their weapons programs. “If you’re for the troops, you want them to have the best weapons,” one defense lobbyist said on Wednesday, casting the pension cut as a necessary step that the House and Senate Armed Services Committees have been unwilling to take.

“They all know these are things that have to be taken care of,” the lobbyist added, asking not to be identified.

Graham also characterized the pension cuts as a win for the defense industry but said that was all the more reason to oppose them. “Contractors have lobbyists running around up here like crazy,” he said.

The senator — a member of the Air Force Reserve who could be eligible for a pension himself at age 60 — is urging military advocacy groups to buy television ads shaming those who supported the deal. He’s also vowing to get to the bottom of exactly who put the cut forward in the first place.

“It’s funny that nobody will step up and own this,” said Graham, who faces several conservative primary challengers back home and has much to gain from his opposition to the budget agreement, which met fierce resistance from tea party groups because it increases the spending caps set by the Budget Control Act of 2011.

“Patty Murray said ‘Ask Paul Ryan,’” Graham said of his search for person responsible. “I talked to Paul Ryan; he said it came from the Pentagon. I talked to [Defense Secretary] Chuck Hagel, who had nothing to do with it.”

But, Graham added: “We’re going to find the culprit here.”

Other Republican defense hawks are also protesting the pension cut, including Sens. Kelly Ayotte of New Hampshire and Roger Wicker of Mississippi. And Democratic Sen. Jeanne Shaheen, who’s up for reelection next year in New Hampshire, is pushing a bill to replace the cut “by eliminating a tax loophole for offshore corporations,” according to a new release from her office.

Meanwhile, the Armed Services Committees are exploring other possible changes to military compensation — and could seek to alter the pension cuts in the budget deal before they roll out in 2015.

Sen. Carl Levin (D-Mich.), who chairs the Senate committee, said his panel “is going to review this change after we convene next year,” noting that Congress last year created the Military Retirement and Compensation Modernization Commission, which is studying the issue.