Earl Pomeroy Introduces Bailout For Union Pension Plans

Union pension funds in America are in a lot of trouble. Last year news broke about the union member pension fund of one of the nation’s largest unions, the SEIU, was only 75% funded (compared to the 103% funding level of the fund for the SEIU’s union bosses). Now Earl Pomeroy (who counts unions as 12 of his top 20 political contributors) wants to give the unions a big, fat bailout at the expense of American businesses and with the backing of the US taxpayer.

FARGO — The nation’s economy will take a big hit if employers don’t receive more time to fully fund their pension plans, Rep. Earl Pomeroy, D-N.D., said Thursday.
“It’s imperative that Congress pass, immediately, pension fund relief for these defined-benefit pension plans,” said Pomeroy, who has introduced legislation that would provide such an extension.
Pomeroy spoke in a telephone news conference Thursday from Washington, D.C. Also participating were James Klein, president of the American Benefits Council; Kathy Cloninger, chief executive officer of the Girl Scouts of America; Barbara Crane, president of the National Federation of Nurses; and Katy Beh Neas, vice president of government relations for Easter Seal.
Klein said many employers are struggling to comply with the federal Pension Protection Act of 2006.
The stock market’s 2008 plunge and extremely low interest rates have caused massive losses in the plans’ asset values, he said.
Defined-benefit plans provide a specified monthly benefit at retirement.
As matters stand now, affected employers will be forced to put billions of dollars into their defined-benefit plans to comply with the 2006 Act, Klein said.

So how does all that transfer into “bailouts for the unions”? As is typical with big government liberals like Pomeroy, the devil is in the details:

…the bill as currently drafted would be a costly sop to unions, which have done so much to get Mr. Pomeroy elected. (Twelve out of his top 21 donors are unions, according to opensecrets.org.) It would allow the unions, which have badly mismanaged pension funds in the past, to make new companies liable for the pension obligations of workers at other companies, in other industries. It also would create an explicit taxpayer guarantee if it all comes crashing down. …
The draft would allow union-controlled multiemployer pension plans to form alliances with one another. It also would create something known as a fifth fund that the Pension Benefit Guarantee Corp., with taxpayer help, would use to prop up failing union pension plans.
Multiemployer union pension alliances might sound innocent enough, but consider what that actually means. Moody’s Investors Service recently warned of a vast underfunding problem with multiemployer pensions. Many employers fear being shackled into them. Even though the funds are controlled by unions, employers are liable not just for their own employees, but for every worker in the plan regardless of how the plan is managed or mismanaged.

So, in summary, unions get all the control and businesses (you know, the folks we’d like to be creating jobs right now) get stuck with all the expense. And not just for their employees, but all union members enrolled in the particular pension plan they’re funding.
And if that doesn’t work? Well then the unions get a nice, fat taxpayer-funded bailout.
If a major US corporation underfunded its pension plan the way the unions have they’d be the target of crusading politicians. But the unions? Well they get a nice, luxurious back-scrub from a paid-off member of Congress like Earl Pomeroy.