WASHINGTON, DC – U.S. Senator Sherrod Brown (D-OH) today said the newly released Pension Benefit Guaranty Corporation (PBGC) report underscores why it’s critical that Congress act to solve the multiemployer pension crisis. According to the PBGC report, the agency hit a record deficit of $65.2 billion, compared to $53.9 billion last year. This $11.3 billion loss shows that this crisis gets more difficult and expensive to solve the longer Congress waits. The PBGC is the arm of the federal government that insures pension plans, and the Multiemployer Program is highly likely to become insolvent by 2025 at the latest.
The pension crisis threatens the retirement of more than 1-1.5 million workers and retirees nationwide and could put small businesses across the country in jeopardy. These miners, truck drivers, carpenters, bakers and others worked hard all their lives and gave up raises at the bargaining table in order to put that money toward retirement for themselves and their families. Now that retirement is at risk.
“What Washington doesn’t understand is that Ohio workers and retirees gave up raises at the negotiating table because they were counting on these pensions and benefits when they retired. It’s up to us to ensure that these workers and their families receive the full benefits they earned over a lifetime of hard work,” said Senator Brown. “News that the PBGC could run out of money and put workers, retirees, and small businesses at risk even sooner underscores the importance of fixing this crisis now, before it is too late. Failure is not an option when millions of American are counting on Congress to act.”
Numerous pension plans, including the Central States Pension Plan, the United Mine Workers Pension Plan, the Bakers and Confectioners Pension Plan, and more are at risk of failure. Several other plans have already had to cut benefits. If nothing is done to help the plans, they will fail and retirees will face massive cuts to the benefits they earned over decades of work.
If the plans are allowed to fail, not only will they no longer be able to pay promised benefits, but taxpayers and small businesses would be at risk of having to pay billions because the PBGC would be on the hook for billions of dollars it cannot pay.
There are several causes for this crisis, including the fact that the economic collapse of 2008 devastated these plans and the people who depend on them. These retirees and workers who have done everything right did not cause this crisis, and Congress must not turn its back on them.