Six years after the financial crisis, the economic aftershocks are still rattling the halls of Congress -- this time in a debate over an esoteric pension provision tucked into an end-of-year budget bill. Though that legislation, known as the “cromnibus,” is supposed to be about annual appropriations for government agencies, lawmakers have inserted language that would give private pension plans the power to cut benefits to thousands of current retirees whose pension savings were decimated by investment losses from the financial collapse of 2008.
If the initiative is enacted, experts say, it would be the most consequential change to retirement policy in the United States since the passage of landmark pension legislation 40 years ago. Altering the 1974 Employee Retirement Income Security Act to permit benefit cuts could prompt a slew of efforts to chip away at formerly untouchable guarantees of income to millions of retirees.
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