Breaking Pension Promises is No Solution at All

Kyle Garrett
Pension Rights Center
June 11, 2014

Complexity is to be expected when discussing an issue like pensions. So for the moment let’s make things simple: 150 to 200 multiemployer plans are severely underfunded and may run out of money in 15 to 20 years if no action is taken. There are approximately 1.5 million workers and retirees in these plans. To solve this problem, members of Congress are considering a proposal that would allow the trustees of these plans to immediately cut benefits across the board for all participants, including those who have been retired for many years.

Let’s borrow an example from a Wall Street Journal article to illustrate how this proposal would work: Greg Smith worked for 31 years under the Central States Teamsters Plan, which is underfunded. He currently receives a monthly pension of $3,019. If this proposal were implemented, Mr. Smith’s benefit would be cut immediately by more than half, down to $1,200 per month. 

Click here to read more at the Pension Rights Center.

 

Get Advice Join TDU Donate

Recent News

Zoom Call for IBT Election Volunteers on Saturday, August 14

TDU will hold a national zoom call on Saturday, Aug. 14 for Teamsters who are volunteering to elect the O’Brien-Zuckerman Teamsters United Slate. Join candidates, campaign coordinators and Teamster activists for an update and to make plans to Get Out the Vote and win this fall. Click here to register. 

Central States Assets Fall – But Relief is Coming!

The assets of the Central States Pension Fund fell to $9.8 billion at the end of March, a drop of $573 million in the first quarter.  The fund projects forward that it will pay $2.83 billion in pension benefits this year, while taking in $651 million in employer contributions.

View More News Posts