Hoffa: Congress must act to avert pension crisis
Opposition is growing in Michigan and across the Midwest against a devastating pension cut proposal put forward by the Central States Pension Fund that would slash benefits by as much as 65 percent. Thousands of Teamsters are letting the federal government know they must reject the plan if they want retirees to be able to subsist on their own.
In December alone, rank-and-file Teamsters and retirees attended meetings in Columbus, Ohio, Milwaukee and Washington to inform decisionmakers at the U.S. Department of Treasury that the application put forth by Central States last fall is unacceptable and will financially ruin many retirees who contributed to the plan throughout their careers. Additionally, more joined in on phone-in conference calls.
Teamster leadership is also resolute in our opposition, writing Treasury officials last month to tell them the pension proposal will not succeed in saving the fund, only destroy the futures of tens of thousands of retirees in their golden years if it is adopted.
After extensive review and analysis, this union does not believe Central States, an independent entity, can save itself through more intensive cuts or higher employer contributions. The reality is that Central States will become a “zombie” plan — its funding ratio will sink to 40 percent and its active worker population will decline by two-thirds. If the federal government is truly concerned with the economic future of Central States’ participants, it will find a way to provide direct financial support to the plan and its participants.
The Teamsters are far from alone in their opposition. Nineteen members of House of Representatives have signed onto two separate letters sent to Special Master Kenneth Feinberg, who is overseeing the process, urging him to reject efforts to slash monthly pension payments. One of those letters signed by Rep. Dan Kildee, D-Flint Township, and 17 others says doing so is a matter of fairness.
“Simply put, America’s workers are entitled to the pensions they’ve earned over a lifetime of hard work — and the big corporations that fall into financial trouble or even declare bankruptcy should not be permitted to take those problems and failures out on employee pensions, especially while executives secure golden parachutes,” they wrote.
The heart of the problem is Congress’ approval of the Multiemployer Pension Reform Act (MPRA) in late 2014. That’s what allowed Central States to put forward such a ridiculous pension proposal in the first place that now is being mulled by the Treasury Department. But there is a way to fix it.
Capitol Hill lawmakers should take a close look at the Keep Our Pensions Act sponsored by Sen. Bernie Sanders, I-Vt., and Rep. Marcy Kaptur, D-Ohio, or the Pension Accountability Act offered by Sen. Rob Portman, R-Ohio, and Reps. David Joyce, R-Ohio, and Tim Ryan, D-Ohio, as a way to solve the crisis facing Central States and other pension plans.
In the end, Congress must start over and do whatever it can through the broad powers and resources of the federal government to protect the pensions of millions of retirees who had nothing to do with the crisis, but whose burden they are now being asked to bear.
Meanwhile, Teamsters need to continue to contact Feinberg and the Treasury Department so the federal government listens to their needs and opposes the Central States’ proposal.
Workers deserve better.
Labor Voices columns are written on a rotating basis by United Auto Workers President Dennis Williams, Teamsters President James Hoffa, Michigan AFL-CIO President Ron Bieber and Michigan Education Association President Steven Cook.