Unions want Washington’s help (your money) with pension funds
Not enough to give them GM and Chrysler, unions now want US to pay for their exorbitant pensions.
Private businesses could take hit from labor
By Kevin Mooney SPECIAL TO THE WASHINGTON TIMES
Nonunion workers and private companies could be forced into absorbing the financial liabilities of underfunded union pension plans, thanks to pending health care mandates and an executive order that could be finalized this year, policy analysts and trade group representatives have concluded.
Even as unions continue to market themselves to new members on the basis of generous pension programs, government figures show these plans are performing poorly in comparison with retirement packages that operate beyond the orbit of organized labor.
In addition, unions are pushing the Obama administration on project labor agreements (PLAs), which, among other things, will give their pension plans new sources of outside funding – nonunion workers on government contracts worth more than $25 million.
The average union pension has resources to cover only 62 percent of what is owed to participants, according to the Pension Benefit Guarantee Corp. Pensions with less than 80 percent of the assets needed to cover present and projected liabilities are considered “endangered,” while those that fall below a 65 percent threshold are classified as “critical” under the Pension Protection Act of 2006.
Pension Benefit Guarantee Corp. figures also state that less than one in every 160 workers is covered by a union pension with required assets.
Michelle Ringuette, a spokeswoman for the Service Employees International Union (SEIU), acknowledged that pension funds for her union and for others were facing difficulties but said the fault lies with businesses, not the unions.
“SEIU’s pension funds – like all pension funds – were hit hard when the market collapsed in late 2008. The union is deeply concerned about the instability big banks and the high-finance industry have created in the markets and throughout our economy, and we take very seriously all threats to the retirement security of our members and people who work for a living,” said Ms. Ringuette, who represents the nation’s largest union by number of members.
Diana Furchtgott-Roth, a scholar with the Hudson Institute, dismissed that explanation.
“A lot of these plans were in trouble even before the stock crash, and the members are entitled to know,” she said, adding that “there should be a law against putting out information about pension funds that is simply false.”
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