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Fears grow over Teamsters pension fund
Washington Examiner ^ | 4/7/13 | Sean Higgins

Posted on 04/07/2013 7:59:37 AM PDT by markomalley

Many unions are facing a serious looming problem: Drastically underfunded pension plans. The hole may be as deep as $369 billion. That’s giving businesses that are tied to the plans the willies.

The way many unions plans work is that several different businesses that represent the workers pay into a common fund. If one business goes under the remaining are legally obligated to cover that company’s pension obligations. That has many businesses looking to get out of these plans early. That’s especially true with those paying into the Teamsters pension fund, the Wall Street Journal reports:

Some companies are pushing to withdraw their workers from a giant Teamsters pension plan that faces a deep funding shortfall and questions about its long-term viability.

Investment losses during the financial crisis and hard times for trucking companies that pay into the Teamsters’ Central States Funds have sapped the fund of money it uses to pay promised benefits.

With just 60 cents of assets for every $1 in obligations, the Teamsters pension fund is considered in “critical” status by the Pension Benefit Guaranty Corp., the federal agency that backstops failed pensions.

Central States has about $18 billion in assets, ranking it the nation’s second-largest multiemployer pension plan. Such funds get contributions from numerous companies.

The Teamsters pension fund pools money from about 1,900 companies, and its investments have been overseen by advisers jointly approved by representatives for union and management.

Recent efforts by Republic Services Inc. to pull out about 800 sanitation workers from Central States show the uphill battle facing a pension plan founded by the late Teamsters President Jimmy Hoffa.

Last week, Republic Services finalized deals with three local Teamster unions in Michigan to move out of Central States to a better-funded Teamster-run plan. Food service distributor Sysco Corp. removed its last Teamster unit from Central States in January.

“There is a reasonable possibility that this plan could run out of money in about a dozen years,” Central States Executive Director Thomas Nyhan said in an interview.

More companies leaving the fund “accelerates insolvency,” Mr. Nyhan said.

Read the whole thing here. It’s a major problem for unions because their pension plans are a major part of their appeal to workers.


TOPICS: Business/Economy; Extended News
KEYWORDS:

1 posted on 04/07/2013 7:59:37 AM PDT by markomalley
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To: markomalley

Why am I not crying any tears over these union thugs problems ?


2 posted on 04/07/2013 8:01:40 AM PDT by American Constitutionalist
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To: markomalley
Every union pension fund is eventually looted by the union leadership.

It's the law.

3 posted on 04/07/2013 8:04:25 AM PDT by E. Pluribus Unum ("Somebody has to be courageous enough to stand up to the bullies." --Dr. Ben Carson)
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To: markomalley
If one business goes under the remaining are legally obligated to cover that company’s pension obligations.

Why would a company go for this in the first place? Who knows what the viability of the other companies is? This is insanity.

On the other hand, Obama will use a stimulus to bail them out (just like GM).

4 posted on 04/07/2013 8:05:44 AM PDT by OrioleFan (Republicans believe every day is July 4th, Democrats believe every day is April 15th.)
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To: markomalley
Osama Obama proposing a 950 billion dollar bailout of union pension funds in 3...2...1....
5 posted on 04/07/2013 8:08:24 AM PDT by Gay State Conservative (Leno Was Right,They *Are* Undocumented Democrats!)
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To: American Constitutionalist
Why am I not crying any tears over these union thugs problems ?

You probably should be as you and I will end up shoring these plans up.

6 posted on 04/07/2013 8:09:13 AM PDT by 03A3 (The reset is gonna be epic.)
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To: OrioleFan

I think UPS has been trying to get away from these Teamster pension funds for years.


7 posted on 04/07/2013 8:10:34 AM PDT by Alberta's Child ("I am the master of my fate ... I am the captain of my soul.")
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To: 03A3
What retirement plans ? don't ya know ? the guberment is putting their hand into the cookie jar, there won't be anything left when they get done with it.

8 posted on 04/07/2013 8:17:20 AM PDT by American Constitutionalist
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To: Alberta's Child

That cannot be right, I recall Hoffa saying that the loans to the gangsters to build a string of casinos in Las Vegas in the 60s were money makers for the fund and not one dime was lost. Perhaps when they were lending to the mobs they made money but when they began buying off politicians they did not get any return on their dollars??


9 posted on 04/07/2013 8:18:04 AM PDT by Mouton (108th MI Group.....68-71)
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To: markomalley

The teamsters supported Obama, now let them live with the consequences.


10 posted on 04/07/2013 8:20:59 AM PDT by anoldafvet
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To: Gay State Conservative

Pension fund shortfalls, increasing number of bankrupt cities, student loan deliquincies and defaults, ballooning federal deficit and debt, and massive unemployment. The financial crises are building serious momentum. Can a game changing event be that far away? Buckle up.


11 posted on 04/07/2013 8:23:53 AM PDT by Starboard
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To: Starboard


12 posted on 04/07/2013 8:39:56 AM PDT by Chode (Stand UP and Be Counted, or line up and be numbered - *DTOM* -ww- NO Pity for the LAZY)
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To: markomalley

Given that the Teamsters have killed so many trucking companies the pension sharing plan shows foresight. Although it does beg the question of; did they plan to kill off companies?

That stated, I think after they killed off CF they realized that they have to start to work with companies more. When the recession hit YRC (aka Yellow Brick Roadway)took first a 10% cut, then a 5% cut shortly after to keep the company afloat. I think they finally started to get some back recently. I’m not sure if they are funding the pension again yet.

In contrast at my non-union trucking company we took a 5% cut, got 1/2 back the next year and the other half back the year after that. And no, YRC was not making more than we were.


13 posted on 04/07/2013 8:42:53 AM PDT by logic101.net (How many more children must die on the alter of "gun free zones"?)
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To: American Constitutionalist

Don’t hold back from crying just yet... Union goons prop up liberal elites - that bunch will find a way to take YOUR taxpayer money and bail out the union crooks.


14 posted on 04/07/2013 8:44:56 AM PDT by GOPJ (New AP term for Illegal Aliens IS Undocumented Democrats.... Jay Leno)
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To: markomalley

What’s the big deal? Just have the union raise their dues on their members.

Mark


15 posted on 04/07/2013 9:13:23 AM PDT by MarkL (Do I really look like a guy with a plan?)
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To: American Constitutionalist

We NEED a bankruptcy of a major state or union pension fund, and the ensuing political debate, to spotlight changes to entitlements and Gov’t union corruption that must be made

Its a Rahm Emanual “don’t let a crisis go to waste” opportunity for conservatives. Let’s hope it happens soon.


16 posted on 04/07/2013 9:15:09 AM PDT by PGR88
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To: markomalley

couple things,
If it’s bad for unions it’s good for America.
I don’t give a rats patootie if unions have problems.


17 posted on 04/07/2013 9:15:14 AM PDT by Joe Boucher ((FUBO))
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To: E. Pluribus Unum

18 posted on 04/07/2013 9:17:03 AM PDT by PGR88
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To: PGR88

You understand the system well.


19 posted on 04/07/2013 9:30:44 AM PDT by Vaduz
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To: Gay State Conservative

Well, since the billionbs which have been stolen from the funds to keep getting democrips elected and fund ‘community activism’ groups, what would we expect from criminals but to raid the tax coffers to repay their funds for future use?


20 posted on 04/07/2013 9:39:28 AM PDT by MHGinTN (Being deceived can be cured.)
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To: markomalley
There are now more unionized government employees than those in the private sector

Lets hope they all go broke quickly.

21 posted on 04/07/2013 9:42:34 AM PDT by dragnet2 (Diversion and evasion are tools of deceit)
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To: American Constitutionalist

“With just 60 cents of assets for every $1 in obligations, the Teamsters pension fund is considered in “critical” status by the Pension Benefit Guaranty Corp., the federal agency that backstops failed pensions.”

While not currently funded by tax revenues, you can bet that when some of these big union pension funds go belly up, the Pension Benefit Guaranty Corp. will run to Uncle Sugar for cash.


22 posted on 04/07/2013 10:16:36 AM PDT by VanShuyten ("a shadow...draped nobly in the folds of a gorgeous eloquence.")
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To: markomalley

Undersunded union pension plan???

employers pay into it...

not their fault..

IDGAF....


23 posted on 04/07/2013 12:13:26 PM PDT by joe fonebone (The clueless... they walk among us, and they vote...)
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