Bobby Bailout: Casey to Put Taxpayers on Hook for Teamsters’ Shenanigans

National Review ^

[roses of sharon]

Sen. Robert Casey (D., Pa.) and Rep. Earl Pomeroy (D., N.D.) are pushing legislation that would commit taxpayers’ dollars to bailing out the Teamsters’ retirement pension fund. The financial crisis and the Great Recession may have upset your retirement plans, but that’s not reason that politically connected union thugs have to share the pain.

Here’s the deal, as former Department of Labor official Vincent Vernuccio, now an analyst at the Competitive Enterprise Institute, tells Exchequer: Under the Democrats’ plan, the U.S. Pension Benefit Guaranty Corp., which is basically a pension-insurance fund run by the federal government, would be able to receive tax dollars to bail out so-called orphan pensions — pensions for which employers have ceased making contributions, usually for reasons of insolvency. Under normal circumstances, PBGC does not use taxpayer money to bail out pensions; it charges aninsurance premium to the funds it covers and uses that money to make good on pension obligations if a particular pension fund goes bankrupt. It’s like an FDIC for pension funds: If a fund is sufficiently mismanaged, PBGC can step in, take it over, and take care of its obligations.

The Casey bill would change all that, creating a “fifth fund” within PBGC that would receive taxpayer support. Currently, federal law carefully specifies that PBGC obligations are not obligations of the U.S. government. Casey-Pomeroy would reverse that, mandating that “obligations of the corporation that are financed by the [fifth fund] shall be obligations of the United States.” In other words: You, sucker, are paying the bill.

[roses of sharon]

August 17, 2010

But wait, there’s more: “As galling as it would be to bail out the Teamsters and their other private-sector union buddies — whose meatheaded management of their pensions has left them with as much as $165 billion in unfunded obligations, according to Moody’s — things would immediately get much, much worse if that precedent were used to justify a bailout of the public-sector unions, whose unfunded pension liabilities run into the trillions. (President Obama’s home state of Illinois is leading the way down the toilet when it comes to state-employee retirements. California’s pension shortfall, Vernuccio notes, is larger than the GDP of Saudi Arabia.) Casey-Pomeroy wouldn’t authorize public-sector bailouts, but it would establish an all too easily expandable template. Second, Casey-Pomeroy almost certainly would lead to a broader union bailout.”

Posted by Glenn Reynolds at 10:29 am

[Boogieman]

They want taxpayers to pay for the mistakes union leaders made getting in bed with the mob and letting them siphon off all the money from the pension plans? This is a load of dung.

[gimme1ibertee]

Know their names.
Mark them down.
Vote them OUT!

[DCmarcher-976453]

This is so un-Constitutional to allocate our taxpayer funds to anyone’s bailout. Somebody, a Republican, must at least ask the Constitutionality of this crap.

[Gasshog]

Tax revolt in order. STARVE THE DIM MACHINE

[Fresh Wind]

We’re stuck with Casey until 2012.

[steveab]

“....with the mob and letting them siphon off.... ‘

All Union pension plans should be audited for the last twenty years to see where the money went. I bet that would be an eye opener.

This is as bad as CO2 cap and tax scam.

[JrsyJack]

And guess where some of those taxpayer funds will go...right back to the Casey election fund. It’s an old, old scam...provide the unions with public funds then allow them to channel it back to the pols as campaign contributions.