Are Unions Next To Be Bailed Out By The American Taxpayer?

[Geee]

Investors Business Daily:

Moral Hazard: America has become the bailout nation. From automakers to investment houses to banks, Washington has used taxpayers' money to rescue one failed business or another. What's next? It might be the unions.

 

First, some history. The Pension Benefit Guaranty Corp. has been around for 40 years. It's an "independent" government agency that says its role is to protect "the retirement incomes of more than 40 million American workers in more than 26,000 private-sector defined benefit pension plans."

 

In other words, its job is to pay benefits to retirees whose pension plans have failed.

 

The PBGC is funded by "insurance premiums from employers that sponsor insured pension plans, earns money from investments and receives funds from pension plans it takes over." And it is essentially broke.

 

The PBGC's annual report says its multi-employer program has a $42.4 billion deficit, up almost 500% from its $8.3 billion deficit last year. The big jump, says RachelGreszler of the Heritage Foundation, is due to the expected insolvency of two large plans that will add $26.3 billion to the program's expected liabilities.