What Am I Missing?

CIO Magazine has published an article that cites the Congressional Budget Office (CBO) indicating that the proposed pension legislation “The Rehabilitation for Multiemployer Pensions Act of 2019” (H.R. 397) won’t be enough to protect and preserve all of the plans. In fact, a CBO “study projected that approximately one-quarter of the pension plans that would be eligible for loans through the bill would become insolvent over the next 30 years and would not fully repay their loans. For those plans that do repay their loans, the CBO projects that they will become insolvent within ten years of repayment.” What’s the issue?

At present, there are roughly 125 multiemployer pension plans that are defined as critical and declining.  With no action, all of these plans are expected to become insolvent within the next 15 years. By providing loans to these struggling plans, we are extending the payment of benefits by 30+ years. If 25% fail to repay the loan in 30-years, so be it. We’ve renegotiated terms on a number of government-funded programs, why should this be any different.

The CBO estimated that the Pension Rehabilitation Administration (PRA), which would be established to issue the loans, would only have to provide $39.7 billion in funding. Seems like a drop in the bucket when compared to TARP. Furthermore, they estimated that only $7.9 billion would be returned. I’d love to understand the inputs that they used in creating this analysis. When Cheiron, a leading pension actuary, conducted their analysis on the original 114 plans, only 3 – the Central States, Coal Miners, and the Bakery, Confectionery, Tobacco Workers – would need extra support from the PBGC. In fact, the remaining 111 plans could meet current benefit payments, interest on the loan, future pension liabilities, and the balloon payment in 30-years while earning only 6.5% on their investments.

Given the modest cost of this loan program and the economic benefit of continuing to provide pension payments to nearly 1.3 million American workers, it seems like a no-brainer to me.  What is the economic benefit? According to Congressional testimony, the “cost of doing nothing in terms of lost tax revenue and increased social safety net spending is estimated to be between $170.3 billion and $241.3 billion over the 10-year budget window, and between $332 billion and $479 billion over the next 30 years.”

So, please explain to me why we, as taxpayers, wouldn’t want to “invest” $39.7 billion in a loan program that has, in my humble opinion, a high degree of success, when not doing so would potentially result in a “loss” of nearly $500 billion in economic activity in the next 30-years?  I would hope that ideology isn’t getting in the way of making a rational decision to finally tackle the pension problem that has existed for decades and one that will only get worse with the passage of more time.


11 thoughts on “What Am I Missing?

  1. “a CBO “study projected that approximately one-quarter of the pension plans that would be eligible for loans through the bill would become insolvent over the next 30 years and would not fully repay their loans”What’s the issue? Well Russ the issue may be that you and the NUCPP lied. Now you are admitting it “is” a bailout and saying so be it.Speaks a bit about credibility dont you think. Also confirms the fact that truth or not you are not an unbiased helpful commentator here to explain to us poor ‘do not have a clue” retirees.but pursuing an agenda.Something you refused to do before. What about these lies..”The loans will be paid back 100%””This is not a bailout” Anybody that has challenged these lies were attacked and censored.When you were asked about this previously you refused to answer. How about answering this which you also refused to,answer.If loans become available under your HR397 language will Central States qualify for a loan.I am sure you will not answer this as well.

    • I have never dodged anyone and I’ve never lied to anyone regarding my knowledge of how this plan works and to suggest otherwise is not fair. Others have called it a bailout so I said well if it is a bailout what’s the big deal, as previous gov’t bailouts have actually been profitable. Second, I don’t know who the NUCCP is and have never worked with them. My only interest is seeing the DB pensions preserved and pensions saved for the participants who have done nothing wrong to deserve this fate. What is your agenda? Furthermore, to your point about Central States, I am lead to believe that any plan that is currently in C&D status can file for a loan (under BLA). I do know that the original analysis had CS needing further assistance from the PBGC. Lastly, I have not made one penny from my advocacy work, yet I continue to do my best to get information into the airwaves. Never was in a union, never had a DB plan, but I certainly understand why they are important to preserve. If you want to ridicule me some more please call me at 201/675-8797, and we can speak for as long as you want.

      • Good luck with your ongoing debate with this woman. You have my sincere condolences in your attempt to explain this to her

      • You do good work..please don’t stop. I dont understand the complexity of all of this and as my health goes down the toilet, I understand less. I still try fighting. But I read your blogs, I see you are the “real thing. ” so thanks for all you do.

    • Russ ; Could you in the future figure the tax implications for the government by the extra federal tax revenue gained by restoring benefits with the BLA. Including all the revenue that the government will lose on future benefit cuts from pensions yet to fie under MPRA. Would this lessen the cost of the Butch Lewis Act substantially? Joe

    • Read the text of the BLA its in there about a fund that can’t pay. So it would be the individuals who wrote the text of the BLA.Without this loophole would the BLA pass in the Senate? Probably no, they would find another reason

  2. I prefer we continue this in this public forum. It is what you use to promote your product which you call free “advocacy” work. Now I could be way off base here and I would love to be corrected but according to statements released by the IBT you were part of the IBT “team” who with others created the Hoffa Act(HR397). Is this false?? If so are you claiming you and the others did not get “paid” for your work. On Friday, April 13, 2018 you appeared before the Committee on Ways and Means with
    John Murphy, Vice President of the International Brotherhood of Teamsters.
    David Blitzstein, Blitzstein Consulting
    Gene Kalwarski, Cheiron, Inc.
    Peter Hardcastle, Cheiron, Inc
    Judy Xanthopolous, Quantria Strategies
    Ronald Ryan, Ryan ALM, Inc.
    to promote the loan program. Are you saying you did not get paid for this appearance? I have asked you if you got paid for your work on the Hoffa Act before and you skirted the question and replied “I was never a Teamster”. So if you did indeed get paid for your work in my opinion you are not advocating. You are promoting a work product.
    You have dodged questions. I have posted here and on your facebook questioning your claims on the Hoffa Act(HR397) and you have refused to answer them. They were legitimate questions such as will the Central States fund qualify for a loan under the language of HR397. Just like you have refused to answer the question now and have instead skirted the question by replying “I am lead to believe that any plan that is currently in C&D status can file for a loan (under BLA)” I did not ask you if they would apply for a loan. I asked you if under the language in the Hoffa Act would they meet the criteria to qualify for a loan. In further response to your answer “any plan that is currently in C&D status can file for a loan” Central States is not just any fund. Central States in under a consent decree. This is another question I have asked that you would not answer Is it not true you have no idea if Central States will even be allowed to apply for a loan. In your opinion do they not have to get permission from the court to apply? A consent court that has already been informed by Segal, who also did an actuarial analysis at the request of Nyhan, that say the loan program will not work. The point of these questions is to ask what good is HR397 if it leaves 400,000 Central States participants in the same position.

    Now you claim you have no idea who the NUCPP is. I find that hard to believe but if you say so. You are the go to expert for the NUCPP. The Teamster Pension Crisis Facebook is the NUCPP propaganda clearinghouse and John Anderson, whom you have praised, is the NUCPP chief propagandist. The site is used by the NUCPP, who have became paid IBT fronts, to provide misinformation to retirees, to promote the Hoffa Act, to run mail in campaigns and to falsely claim to speak for and represent all retirees. You are portrayed as the Hoffa Act expert who has repeatedly dispelled the challenges of the Hoffa Act nay sayers. All your blog posts are copied to the site with commentary such as “”BAIL OUT” ? KAMP & RYAN BEG TO DIFFER” Odd and you say you do not know who they are. Now Anderson has recently posted on this NUCPP site the following” Central States does not qualify for a Loan, that’s what happens when there is not enough time or remaining funds available… CS must rely on grants ALONE (basic total BAIL OUT for them), from PBGC under the BLA program”… Is this statement false??
    The fact is you have made multiple statements saying this is not a bailout and the loans will be repaid. By the way free money from the PGBC or loans that are not repaid “IS A BAILOUT” no matter how you try to spin it. And now the CBO has declared 25% of the funds would not be able to repay the loans and you answer is what’s the issue? I notice you are not arguing that they are lying and as you previously stated the loans will be paid back. And for the record to answer “So, please explain to me why we, as taxpayers, wouldn’t want to “invest” $39.7 billion in a loan program”.I am sure the taxpayers would have no problem with investing in a loan program that “bails out” retirees who are victims of both failed Federal oversight and Union leadership who have been looting and mismanaging the funds they entrusted them to protect. But I can also see where Taxpayers would certainly strongly object to legislation that gives Federal tax dollars to the same group of crooks who have mismanaged and looted their participants funds and then wrote and implemented MPRA to rob from their own retirees. And that is what your ”work product” will do if passed. Perhaps if you really wanted to advocate for retirees you would not have chosen to conspire with the well documented crooks at the IBT to craft legislation that gives those that created this crisis something they have been after for years. Taxpayer dollars which allows them to continue to loot funds and rob retirees and then apply for loans to cover for their actions. Perhaps you might have created legislation that directly bailed out retirees while eliminating the people that robbed them in the first place. Just a thought. You do realize that while calming to oppose cuts Murphy and Hoffa used the IBT lobby and spent millions to lobby FOR MPRA..

    I am not trying to ridicule you nor do I have an agenda other than trying to decide for myself if your “work product” best serves retirees. And to be clear I strongly oppose giving a dime of taxpayer dollars to those who are directly liable for this crisis without serious conditions. Despite you rhetoric your work IS a bailout of Union funds and that is its intended goal. Maybe not yours but certainly your friends at the IBT. Any money retirees receive is a by product I been wondering why Teamster funds not projected to go insolvent until 2030 are applying for cuts under MPRA when the Hoffa Act(HR397) is in the works. I mean Hoffa recently made a deal with Jack Copper allowing them to enter the Nyhan created Hybird Pool and cut their contributions to the CS fund so it seems Hoffa in violation of ERISA is controlling the Central States and other Teamster funds. I see nothing where they put this deal before the consent court or got approval. You are aware of the Hybrid Pool created by Nyhan in 2012 and these “deals”. Another question you dodge. I asked you what damage to the fund this hybrid pool has done and is still doing to the CS fund. I asked how the “deals”, like cutting their contributions as much as 50% and withdrawal liability deals, impacted the fund and its funding status. It seems the feds were asking the same questions and the PGBC said it may not have approved the hybrid pool back in 2012 if the terms of these deals had been revealed” information regarding the terms of the settlements could have affected PBGC’s analysis of whether the statutory criteria had been satisfied”.
    but lets use your work to give Central States taxpayer money (if they even qualify) or a complete bailout form the PGBC before these questions are answered. I don’t think so.

    You have adamantly claimed this is not a bailout and the loans will be repaid. Now according to the CBO and others they will not be repaid so this is a bailout. Something those of us who can think for themselves and who are not biased/promoting have questioned all along You are not arguing their conclusions on the 25%. You are now saying “so what” And this write up is not the first time you have alluded to the “so what” position. A stark change from the “this is not a bailout” position. Now you can choose not to post this but rest assured I am posting it in another public forum. Not to ridicule but to question. Retirees are facing a life changing crisis and turning to the Federal Government for a solution. To consider a real solution to this crisis, which will have a ripple effect many will not cover from, retirees much search for the truth to make informed decisions.

    • Good morning, Richard. I hope that you had a great weekend. Not sure that I can be any simpler in my response. I have never made a single penny on any of my advocacy in support of multiemployer plans. Didn’t get paid for my work with John’s team and in fact, didn’t get reimbursed for my expenses associated with my trips to DC to help support the BLA.

  3. Thanks for your support and help with our fight for our retirement savings.

  4. Russ. Rather revealing that you have no problem posting Bob “The Bad Hair Piece” Amsdens insulting posts but fail to post my response.As we all know Bob is an NUCPP muppet who is a consummate liar in regards to the Hoffa Act. No bias here is there.

    • Hi Richard – Good afternoon. Actually, I was speaking at the Opal conference in NYC the last couple of days. Again, happy to provide education to our industry at my own expense, as I don’t get paid or reimbursed for my expenditures. Also, I happen to be on a flight to AZ to provide more education to a public pension system with no guarantee of getting any business. I do these things because our industry needs help. Since I have been out of the office for the last three days, I haven’t been able to respond to your tome. In the future, please keep your comments and/or questions to one per note. I don’t have enough hours in my day to respond to pages of comments. As for the posting of the other comments, I don’t know that individual nor do I know the organization to which you are referring. Furthermore, I would sincerely appreciate keeping this site professional at all times, so that the purpose of my postings, which is to provide education can be fulfilled. Thank you, and have a great day.

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