Congress pushing $165 billion union pension bailout

[Argyle58]

The Washington Examiner:


Congress pushing $165 billion union pension bailout
By: Mark Hemingway

Get ready for the next ginormous taxpayer bailout:

A Democratic senator is introducing legislation for a bailout of troubled union pension funds. If passed, the bill could put another $165 billion in liabilities on the shoulders of American taxpayers.

The bill, which would put the Pension Benefit Guarantee Corporation behind struggling pensions for union workers, is being introduced by Senator Bob Casey, (D-Pa.), who says it will save jobs and help people.

As FOX Business Network’s Gerri Willis reported Monday, these pensions are in bad shape; as of 2006, well before the market dropped and recession began, only 6% of these funds were doing well.

Although right now taxpayers could possibly be on the hook for $165 billion, the liability could essentially be unlimited because these pensions have to be paid out until the workers die.

Faithful Examiner readers already know that I warned this was happening in a column in early April:

The mother of all taxpayer bailouts is right around the corner.

Union bosses want taxpayers to foot the cost for bailing out the labor organizations’ many failing pension plans that millions of their members are counting on to “be there” when they retire. Unfortunately, the average union pension plan has only enough money to cover 62 percent of its financial obligations.

Such a low level of funding puts those plans on the government’s critical list. Pension plans funded below 80 percent are considered “endangered” by the government. Below 65 percent is “critical.” With union membership declining, that puts these funds into a tailspin from which they’ll likely never pull out.

The government’s Pension Benefit Guaranty Corporation only guarantees pensioners $12,000 a year, should their pension plan fail. Good luck retiring on that.

But as the economy sours, there’s increasing pressure to bail out workers from failing unions. Last July, for example, the PBGC agreed to take on $6.2 billion in pension liabilities from bankrupt auto parts manufacturer Delphi. And that’s just one company. In 2007, the PBGC was already running a deficit of nearly a billion dollars. Things will only get worse as the PBGC is expected to assume $86 billion in liabilities by 2015.
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They won't make a move to try to fix Social Security, but union pensions take on priority status.

[Casino67]

"Although right now taxpayers could possibly be on the hook for $165 billion, the liability could essentially be unlimited because these pensions have to be paid out until the workers die."

 

This is the real problem. When does the government stop paying? This is what got Greece in trouble, unlimited benefits paid for by taxpayers. As they say, "Socialism works until the other guy runs out of money."

[pinz]

The reason why the pensions are unfunded is because corrupt union bosses (excuse the redundancy) use the dues to fund leftist political campaigns instead of investing the money like they're supposed to do.

 

Now that the lefties are in power, they want to raid our pockets to pay off their debts. Thus freeing up union funds for continued political activity.

 

Not only are they killing off the Golden Goose, they are forcing it to commit suicide. I just cleaned out the garden shed. Thank goodness I saved a few old pitchforks when I was decluttering!

[SrWoodchuck]

MrsSrWoodchucks union Local 7 UFCW:

 

$28 million out of a strike fund of $32 million, went to elect Obama & Colorado liberals, with no option to withdraw your support, if you're not Democrat......then five months later.....ooops , time for our contract negotiation.....waaaah, we have no money.

 

UFCW Local 7 Pension in yellow zone-hovering at 80%

[Sanguine]

"Although right now taxpayers could possibly be on the hook for $165 billion, the liability could essentially be unlimited because these pensions have to be paid out until the workers die."

 

This is the real problem. When does the government stop paying? This is what got Greece in trouble, unlimited benefits paid for by taxpayers. As they say, "Socialism works until the other guy runs out of money."

 

Oh, no, the government is not paying. They are writing a check, signing the taxpayers names, and borrowing the money from China, etc., and giving it to unions so that....oops, that's where my argument falls apart. I just don't get it. The only reasons someone would do that is to illegally and unethically repay one's political bosses and minions, or as a part of a plan to destroy the economy, integrity and sovereignty of the U.S., theoretically speaking of course.

[clearvision]

Wait until we have to start bailing out the state pensions.

[Argyle58]

According to the FEC, out of the top 107 contributors to federal election campaigns, 26 are labor unions. From 1989 through 2009 they have contributed $561,230,073.00 to federal campaigns, 90.35% of those contributions going to democrat candidates.

 

These figures cover only those in that top 107 list, and doesn't include state and local elections. It also doesn't include the approximate $65M a year spent on lobbying congress.

 

I wonder what the shape of their pension funds would be in if they were contributing to them, instead of politicians. I know that the country would be in better shape.