Complete Text of Letter
Its Time to Fix Americas Broken Pension System
If a National Threat Level existed for Americas pension system, its current condition would have to be rated severe based on recent events that threaten the financial security of the nations retirees. Senate Commerce Committee Chairman John McCain has aptly described the situation as a looming train wreck that could cost the taxpayers of America untold billions of dollars.
Sen. McCain was responding to alarming testimony by the director of the Pension Benefit Guaranty Corp. (PBGC), the federally backed insurer of pension funds. According to the director, the solvency of the pension insurance program is at risk, creating the potential for a multi-billion dollar taxpayer bailout of the PBGC.
Since 2001, hundreds of thousands of American workers, retirees and dependents have seen their pension plans taken over by the PBGC, bringing that agencys deficit to more than $11 billion last year. Another 120,000 workers and retirees will fall under PBGC as a result of United Airlines stopping payments to its various pension funds, representing the largest default by a U.S. company.
Recent action by the PBGC to increase the premiums it charges to insure company pensions is only a stopgap measure that does nothing to address the longer-term solvency of the agency, or to fix our broken pension system. The situation demands a comprehensive legislative solution from Congress that will protect the pensions of some 45 million current and future retirees under single and multi-employer pension plans.
Unfortunately, calls for federal action from retiree organizations including NRLN, as well as from unions and the PBGC, have been lost in the current election rhetoric. Instead of listening to those constituents most directly affected by the collapse of privately funded pensions, our elected officials appear to be guided by the same corporate lobbyists whose advice led us to the current crisis.
Presidential and congressional candidates need to wake up to the concerns of retiree and employee organizations and involve them in advancing a legislative remedy before this national threat becomes a reality, necessitating a multi-billion dollar taxpayer bailout of the PBGC and continued economic hardship for millions of Americas retirees.
A.J. (Jim) Norby
National Retirees Legislative Network (NRLN)