Download production-quality video of Senator Brown’s opening remarks and questions from the hearing HERE.
WASHINGTON, DC – U.S. Senator Sherrod Brown (D-OH) joined Senator Orrin Hatch (R-Utah) today to chair the fourth hearing of the bipartisan, joint House-Senate Committee tasked with solving the pending pension. Today’s hearing highlighted the dire consequences for businesses and the economy if Congress fails to act. The Chamber of Commerce and other witnesses from the business community joined Brown in urging a bipartisan solution as the Chamber released a new report, titled: “The Multiemployer Pension Plan Crisis: Businesses and Jobs at Risk.”
Employers across the county face burdensome liabilities through no fault of their own as result of systemic failures and other companies going bankrupt. Many of these employers are small, family owned businesses at risk of collapsing if they end up on the hook for pension liability they can’t afford to pay, lacking the resources of larger companies.
“Small businesses that have been in the family for generations could face bankruptcy,” Brown Said. “Workers will lose jobs at businesses forced to close up shop. These businesses are already feeling the effects of this crisis. Uncertainty surrounding their future threatens their access to credit, their ability invest in the business, and their decisions as to whether to expand and create jobs. That’s why this issue cuts across party lines, across ideological lines, and through every region of the country.”
Aliya Wong, the Executive Director of Retirement Policy for the United States Chamber of Commerce, testified before the Committee that businesses are already starting to see negative impacts from the crisis.
“Employers are starting to see banks and lenders question their creditworthiness, leading to less optimal lending rates, or even denial of credit,” Wong said. “Employers have lost the opportunity to expand their business operations through mergers because other companies do not want to be associated with the potential withdrawal liability. Furthermore, small, family businesses are deciding not to pass the business down to heirs for fear of leaving them to pay a future withdrawal liability. Instead of continuing these family businesses, owners are shutting down the businesses and selling the assets, which is a preferable outcome to paying a withdrawal liability that could bankrupt the business. All of these events result in lost business opportunities and fewer jobs.
“The risk to businesses include employers not only in declining plans but also in healthy plans,” Wong continued. “And the job risks impact not only union employees but also non-union employees. This is not a future crisis; it is a current crisis.”
Numerous Ohio pension plans, including the massive Central States Teamsters Pension Plan, the United Mine Workers Pension Plan, the Ohio Southwest Carpenters Pension Plan and the Bakers and Confectioners Pension Plan are currently on the brink of failure. The Ironworkers Local 17 plan has already had to cut benefits. If nothing is done to the plans, they will fail and retirees will face massive cuts to the benefits they earned over decades of work.
Brown has been fighting to solve the pension crisis for years and has introduced his own solution, the Butch Lewis Act. Earlier this year, he secured the creation of the Committee as part of the overall budget compromise. At Brown’s urging, the Committee will have instructions to report a bill by the last week of November, and will be required to hold at least five public meetings, including the option of field hearings outside of D.C., so members of Congress can hear directly from retirees, workers and businesses affected by the pension crisis. The solution the Committee produces will be guaranteed an expedited vote in the Senate without amendments.
The following witnesses are scheduled to testify:
Mr. Chris Langan, Vice President of Finance, UPS, Atlanta, GA
Ms. Aliya Wong, Executive Director of Retirement Policy, U.S. Chamber of Commerce, Washington, DC
Ms. Mary Moorkamp, Chief Legal and External Affairs Officer, Schnuck Markets, Saint Louis, MO
Mr. Burke Blackman, President, Egger Steel Company, Sioux Falls, SD