Here is a partial explanation of the pension reforms in the omnibus bill just passed. As a Local union pension trustee said, all the options suck. Some funds fail due to poor management, poor luck, or both. Increased life spans sometimes mean retirees outnumber active contributors, and early-outs may be a factor. What isnt mentioned in this article is the biggest factor: the huge destructive impact of the 2007-08 financial crisis, the worst money mess since the Great Depression. That, and the previous irresponsible practices of mortgage lenders leading the the housing bubble bust, destroyed weak funds and severely damaged even well managed and well funded pension plans, as well as the PBGC itself, which also depends in part on investments. (not taxes) That crisis is almost universally blamed on inadequate regulations and the greed of large banking corporations and Wall Street who operated unethically at the edge of, and even beyond illegality. Some moderate legislation (Dodd-Frank) was passed to partially restore effective regulation and hopefully prevent further mischief by Wall Street. Slipped into the budget bill just passed by congress was legislation designed to reduce the minimal Dodd-Frank restraints on Wall Street, as well as providing greater giveaways to large corporations, and reductions for the needy. So workers pensions take a hit, while the people most responsible for the problems walk away. Or drive to the Yacht in a S63 Mercedes-Benz. Just sayin: put blame where it belongs.
Posted on: Sun, 14 Dec 2014 05:42:52 +0000
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