Washington, D.C., November 4, 2010 — America has voted and the power in Congress has shifted. House Democrats who kowtowed to union special interests have been duly punished by their constituents. But taxpayers aren’t off the hook yet.
There are currently two bills in Congress that propose using taxpayer dollars to bailout private union pension funds. The Preserve Jobs and Benefits Act was introduced in the House last year by Reps. Earl Pomeroy (D-ND) and Pat Tibiri (R-OH). This past March, Sen. Robert Casey (D-PA) introduced the Create Jobs and Save Benefits Act of 2010.
CEI Labor Policy Counsel Vincent Vernuccio points out that if either of these bills are passed, the Pension Benefit Guaranty Corporation will be allowed, for the first time in history, to use public funds to bailout mismanaged union pension plans.
In this month’s issue of Capital Research Center’s Labor Watch, Vernuccio urges members of Congress to recognize these two bills for what they are–a gift to Big Labor at the expense of American taxpayers.
“The public is increasingly aware that state government and union pensions are essentially a giant pyramid or Ponzi scheme,” Vernuccio says. “The system, which promises benefits to retirees, cannot be sustained unless new members are enrolled in order to pay for the pensions of retiring workers. Think of the promises Bernie Madoff made to his clients–or the promises Social Security makes to retirees. Government and union pensions are on a collision course with disaster that is bound to accelerate over the next decade. However, unlike government pensions and Social Security, union pensions aren’t open to political fixes or backstopped by Y.S. taxpayer dollars–for now. However, all this may change if Big Labor persuades some Democrats and Republicans in Congress to see things their way.”
Read Vincent Vernuccio‘s full Labor Watch article, “The 2010 Union Pensions Bailout Bills,” here.