May 20, 2015: Nearly 400,000 Teamsters and retirees are threatened with pension cuts. How Hoffa helped put the hit on their retirement.
Nearly 400,000 Teamsters and retirees in the Central States Pension Plan are threatened with the worst pension cuts in Teamster history. So are thousands more in some local plans in New York, New Jersey and Western Pennsylvania.
Long before Congress passed pension cut legislation in December, the Hoffa administration helped pave the way for this disaster.
Passing the Buck
The Hoffa administration tries to blame the stock market meltdown of 2008 for the problems at Central States.
That’s not a complete lie: the Central States Fund lost $9.5 billion in 2008.
Figures don’t lie, but liars can figure.
After all, every pension fund, including the huge $35 billion Western Conference of Teamsters Fund, is invested in the stock market. Why is the Western fund healthy and Central States on the rocks?
The Big Sell-out of 2007
In 2007, UPS demanded to pull all its members out of the Central States Fund. Hoffa and Ken Hall gave UPS exactly what they wanted.
That is the single biggest cause of the Central States Fund disaster.
In return for the pullout, UPS was required by law to pay $6 billion to the fund, but in 2008 the fund promptly lost 35% of that, with Goldman Sachs managing the money.
Kroger: Another Sellout?
The IBT has made a tentative deal to let Kroger pull out of the fund without even paying the withdrawal liability required by law!
This sellout would cost Central States approximately $1 billion in unpaid withdrawal liability plus $50 million a year in contributions.
The Central States Fund issued a letter in April stating that they will not recognize the illegal deal; at press time, the issue is unresolved.
The Union Response
Hoffa Sr. built the Central States Fund. Hoffa Jr. is dismantling it.
The problem goes way beyond the Hoffa administration. Deregulation and job loss have taken a toll on pension funds. Some small Teamster pension funds in the East that faced no UPS pullout are in trouble due to deregulation and job losses.
The threats to our pension funds are real. The job of our union leadership is to mount a defense: by organizing new companies into the funds and mobilizing political power to defend our retirement security.
Under Hoffa it’s been the opposite. the Central States Director testified in favor of the pension cut legislation. Not one Hoffa administration official has spoken out against the Central States pension cut plan.
Working Teamsters and retirees are mad—and we’re taking action. Join the movement to save union pensions. The retirement you save may just be your own!