Fort Report: Labor Day
A woman named Mary came into my office recently with two truckers. Their pensions were in danger. Mary wanted to livestream the meeting so that truckers around the country could watch. I said, “Mary, that’s not our policy. What’s on your mind?” We just talked. Mary began to tear up as she explained the dire circumstances in which the two men found themselves.
It was not the first time I had heard about this problem. At several town halls a few years back, the multi-employer pension crisis came up. I listened intently as a constituent named Bob walked me through the harsh realities of exactly how unfair this was. And I quickly realized that he was exactly right. Many people are affected.
Multi-employer pension plans are sponsored by employers in the same industry and maintained as part of a collective bargaining agreement. Here is the problem. Bad decisions by investment companies, corporations, and unions have left these people vulnerable. Some of these plans have such insufficient plan assets that they may be unable to pay 100% of the benefits promised to plan participants. A few very large multi-employer direct benefit pension plans are in such dire financial condition that they are expected to become insolvent within 10 or 20 years.
Congress created a Joint Select Committee to solve the multi-employer pension crisis with bipartisan legislation by the end of December. In the meanwhile, I have cosponsored the Rehabilitation for Multi-Employer Pensions Act, which establishes a Pension Rehabilitation Administration within the Department of the Treasury to make loans to multi-employer-defined benefit plans. I am hopeful that the committee—whose 16 members are evenly split between Democrats and Republicans—can develop a workable legislative approach to address the current crisis and help ensure that we can avoid similar problems in the future for the pension plans of hardworking Americans.
We often hear in political circles that Social Security and Medicare are “entitlements.” They are not entitlements. Yes, there are future actuarial concerns, but people worked for the money they paid into those programs. They deserve their own money, they deserve their own care, they deserve a reasonable retirement. In the same way, pensions are not entitlements. Hardworking Americans—plumbers, pipe-fitters, truckers, electricians, teachers—paid into their pension plans, with a reasonable expectation that when they retired that they would have a modest savings for retirement.
As we head into Labor Day, we need to remind ourselves that some people work with their hands and shower at night; some people work behind a desk and shower in the morning. At the same time, we all have the same aspirations—to raise a family, give as good a life to our children, and have enough to be secure later on. Persons with pension plans worked hard, did their duty, and were given a promise. No one should be told they face a massive cut after they have worked hard their whole life.
While many of these workers will not get all their money back, the principles of fairness, dignity, and compassion mandates that Congress, in a bipartisan manner, lays down a mark for a constructive solution. Therein lies the deeper meaning of Labor Day.