Congress Allows Pension Cuts For Current Retirees
A provision in the recently passed spending bill will allow some underfunded multi-employer pension plans to cut benefits for current retirees.
“The move was the result of an alarm from the Pension Benefit Guaranty Corp. (PBGC) that multi-employer plans covering more than 1 million participants are substantially underfunded and, without legislative changes, will probably fail,” Washington Post business columnist Michelle Singletary wrote.
Under the law, “plans that estimate they won’t have enough money to pay 100 percent of benefits within 15 or 20 years can cut benefits,” but not for retirees who are 80 or older, or those who are on disability. Cuts would also be phased in gradually, so retirees between the ages of 75 and 79 would face smaller cuts than those under 75.
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So what will most companies do when they see the chance to reduce their operating expenses with the support of the government?
David DeGerolamo
David:
I would argue that the PBGC, as well as the FDIC, are insurance corporations who can rely on the taxpayers to back their policies. As opposed to any number of “private” insurance corporations who have to back their underwriting with their own finances, they depend on the taxpayer as a backstop.
I would agree that the whole “house-of-cards” needs to come crashing down, but the taxpayers shouldn’t be left holding the bag.
Let me ask you: Who is the beneficiary of a “pension”? Have you every worked for an entity which offered a Defined Benefit Plan as opposed to a Defined Contribution Plan? In my adult working life, the only entities offering such a plan are union shops and governments.
If one is ignorant enough (note that I didn’t say stupid enough) to relegate their retirement funding to a third party (such as Social Security or a “pension”), then they chose poorly.
NW
As outlined in the Creature from Jekyll Island, the plan was always for the people to be responsible for the debts of the banks. This is another extension just as the recently passed continuing resolution transference to the taxpayer for the TBTF banks’ derivative exposure of several hundred trillion dollars.
At this point, it does not matter if you have a retirement account or individual savings for retirement: money will be worthless. As the people in Russia are showing the rest of the world by withdrawing their rubles and buying durable goods.
Got Faith?
The ERISA law said they could not cut pensions until the money was gone. Laws don’t mean nothin’ no more.
If the rule of law means nothing, then the republic is gone. The only thing left is for the people to realize this and its consequences: Tyranny and Slavery.
The republic died April 9th, 1865.