As the Trumpsters Hoover up every dollar, whether committed or not,
into the hopper of the Elite 1%, older Americans will be forced into
bankruptcy. In the long haul, the Ruling Class is guaranteeing their
own demise. But in the short haul, many working class families will
suffer.
Of course our history has been so altered by the Ruling Class that it
bears little resemblance to actual events. Still, it should be
obvious to anyone who can pull their heads out of the TV, that the
bottom line for the Ruling Class is total possession...of everything.
And yet there are those who think we can negotiate or compromise with
them. Truly we are on a Ship of Fools. And we are the crew.
Carl Jarvis
On 3/16/17, Roger Loran Bailey <dmarc-noreply@xxxxxxxxxxxxx> wrote:
http://themilitant.com/2017/8111/811104.html
The Militant (logo)
Vol. 81/No. 11 March 20, 2017
(front page)
Pension funds for nearly 1 million workers are on verge of collapse
BY BRIAN WILLIAMS
Increasing number of U.S. workers, already feeling the squeeze of
slow-burn depression conditions pressing down on them from the worldwide
capitalist economic crisis, now face losing pensions that supposedly
were guaranteed to them by the bosses for as long as they lived. Large
portions of these funds were gambled away by money managers or pension
“specialists” assigned to administer them when the financial crash hit
in 2008.
Nearly 1 million workers retired or still working are covered by pension
plans in imminent danger of insolvency, the Pension Rights Center
reported Feb. 28.
Based on a law Congress passed in December 2014 — the Multiemployer
Pension Reform Act — pension funds deemed to be in “critical and
declining status” can apply to the Treasury Department for permission to
slash retirees’ payments. And growing numbers of fund managers are doing
just that. According to the center, 68 private-sector union pension
funds fit that description today.
In February pensions for some 4,000 retired members of Teamsters Local
707 in New York were halted as officials announced the fund was
insolvent. The same circumstances may soon be facing another 35,000
workers covered by the New York State Teamsters Pension Fund in the
Albany region and 407,000 in the Midwest and South covered by the
Central States Pension Fund.
“I had a union job for 30 years,” Local 707 retiree Tim Chmil, 71, told
the New York Daily News. “We had collectively bargained contracts that
promised us a pension. I paid into it with every paycheck. Everyone told
us, ‘Don’t worry, you have a union job, your pension is guaranteed.’
Well, so much for that.”
Money managers seeking to turn a profit gambled away these funds
speculating on stocks, bonds, hedge funds and other financial schemes.
When the financial markets crashed in 2008, 40 percent of the Teamsters’
Central States Pension Plan’s investments went up in smoke.
And things have continued to get worse. As of last August, pensions run
by companies in the S&P 1500 index were underfunded by $562 billion — up
$160 billion in just seven months, reported the Financial Times.
The crisis is rooted in how these pension funds were set up — on a
company-by-company basis, or in the case of multiemployer plans,
industry by industry. Instead of basing pensions on the pipe-dream of
the perpetual profitability of the bosses, retirement for all working
people should be government-financed at union scale.
In February 2016 monthly pensions of Local 707 members were slashed by
more than 30 percent in hopes of keeping the fund solvent. But a year
later the fund went broke and retirees received even lower amounts from
the Pension Benefit Guaranty Corp., a federal agency that insures union
pension funds. Average monthly take home pay after taxes was only $570,
agency officials said, with many Teamster retirees getting only
one-third of what they were promised at retirement.
But the government’s Pension Benefit Guaranty Corp. itself will soon go
belly up. “We’re projected to run out of money in eight to 10 years,”
Tom Reader, the group’s director, told the media.
In Cleveland, Iron Workers Local 17 approved benefit cuts ranging from
20 to 60 percent for retirees at the end of January, in hopes of
extending the lifespan of their “declining status” fund.
Joe Finley, 63, who regularly worked 12 hours a day and took weekend
shifts to earn more credits for his pension, told the Washington Post
that his monthly check is being reduced to $1,900 from about $3,500 — a
gap equal to his monthly mortgage payment. “You play by all the rules,”
he said, “and then they pull the rug out from under you.”
Last year several thousand Teamsters rallied at the U.S. Capitol to
protest cuts up to 50 percent in retiree benefits proposed by Central
States Pension Fund administrators. The action helped hold off the cuts.
But the Treasury Department said it didn’t see anything that could
prevent the fund’s collapse.
Pension funds for federal, state and city government workers are also in
deep crisis, unfunded by more than $5 trillion. South Carolina alone has
a projected shortfall of $24 billion, more than triple the state’s
annual budget.
In Puerto Rico, a U.S. colony, the government Employee Retirement
System, which owes $45 billion to nearly 100,000 retirees, will run out
of cash this year. In a desperate effort to keep things afloat, managers
had wrapped the fund’s assets up as bonds and sold them on the market.
Today they’re close to worthless.
Related articles:
On the Picket Line
Wash. farmworkers join union, protest conditions
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