Failure to pass important legislation to protect and preserve critical and declining multiemployer plans will lead to a national crisis that will not only impact the nearly 1.4 million Americans who were promised a pension, but the economic fall-out will take a much greater toll on the U.S. economy. The economic stimulus provided by annual benefit payments dwarfs the potential cost, yet our august Senators fail to understand this basic math. Could it be that their politics is blinding them? It certainly seems so.
In the latest display of economic ignorance, we have Senator Enzi (Republican from Wyoming) railing about the potential impact as calculated by the CBO of $49 billion over 10 years. Is he kidding? The Republican “lead” (a term that I am using quite loosely) Senate has overseen a series of annual Federal budget deficits that have been topping $1 trillion. The roughly $5 billion per year would be equivalent to <0.05% of the annual deficit.
Furthermore, he is assuming, and we know what the problem with that is, that the loans involved in the legislation H.R. 397 would not be repaid. As we’ve mentioned many times, the actuarial firm Cheiron calculated that all but three of the pension systems receiving the low-interest rate loans would be able to pay back the loan upon maturity significantly reducing that $49 billion estimated impact on the taxpayer. More important, these plans would be able to protect and preserve the promised benefits for at least the next 30 years instead of seeing these plans fail within the next 15 years.
We need true statesmen at this time who will forego their ideological politics by putting forward a bi-partisan approach to solving this crisis. The plan participants didn’t create this crisis, but they are certainly the ones that will be most harmed should our leaders once again fail us. If Senator Enzi thinks that he’s protecting the U.S. taxpayer he should realize that the lost economic stimulus will have a greater negative impact on them and our broader economy.