Not Kicking On Multiemployer Plan Bailout

There is much that this National Review article got wrong about the imminent federal bailout of multiemployer plans (there are actually about 10 million participants) but most glaring:

The House of Representatives passed H.R. 397, the Rehabilitation for Multiemployer Pensions Act, before leaving town for summer recess. Proponents claim that this legislation would protect the pensions of over a million private employees whose pension funds have gone insolvent. In truth, all H.R. 397 does is kick the can down the road while saddling taxpayers with the cost in the meantime.

H.R. 397 has nothing to do with kicking any can down any road. It IS the solution and as long as these blank checks are good there is no more crisis – for participants in multiemployer plans and those who run them. But for everybody else:

  1. That unlimited federal backstop could be quite the selling point for unions looking to attract new members with negotiated low-ball contribution requirements.
  2. Will there even be funding rules any more?
  3. 40 million participants in public pension plans are in line.

Of course well-thought out language and rigorous enforcement could mitigate these concerns……but how likely is that to happen?

33 responses to this post.

  1. Posted by PS Drone on August 7, 2019 at 1:36 pm

    Alfred E. Neuman is in charge of the Federal Treasury.

    Reply

    • Posted by Rex the Wonder Dog! on August 8, 2019 at 11:32 am

      Alfred E. Neuman is in charge of the Federal Treasury.
      “Mad Magazine” just ceased operations after 67++ years 😦

      Reply

  2. Posted by stanley on August 7, 2019 at 2:07 pm

    Wilford doesn’t say what real reforms would look like. Those who don’t strongly oppose a bailout appear to think that the government can fund any program and the financial markets have no say in the matter. I would argue that minimal support for MEP PBGC would be quite extravagant assistance and the most a moral dictum could demand. After all are we all supposed to drink the Jim Jones Cool Aid because some fools at the MEP plans couldn’t make simple decisions in managing money? I have no use for aggressive panhandlers.

    If financial markets were strong with limited, responsible indebtedness, under funded pensions might not pose so much of a problem. That is not the case and I believe that it can be well argued that if there were no pension problems the world would be facing really serious difficulties of a historical world wide bubble.

    It will be interesting to see what the Senate comes up with and how it is resolved in the conference committee.

    Reply

  3. Posted by Tough Love on August 7, 2019 at 10:25 pm

    Off Topic…………

    A judge just terminated this former NJ Police Chief’s pension.

    https://www.nj.com/hudson/2019/08/state-judge-revokes-pension-of-former-jersey-city-police-chief-who-admitted-to-no-show-security-job.html

    Definitively a BIG price to pay for taking $31,000 in corrupt payments for off-duty security details he did not work.

    I was starting to feel a bit sorry for him UNTIL I got to this part …..

    “When Zacche retired in 2017, he cashed out 450 sick, vacations and comp days for $512,000.”

    WTF, shit like this NEVER EVER EVER happens in the Private Sector, and in the PUBLIC Sector, it’s the Taxpayers (the vast majority of whom of whom work in the PRIVATE Sector) that pay for it. This is beyond outrageous and NJ’s taxpayers have been so enormously ripped-off by such deals.

    Sorry buddy …………… get used to NO PENSION !

    Reply

    • Posted by Anonymous on August 8, 2019 at 7:15 pm

      Few people are considered lucky if they somehow managed to save, invest and sacrifice to have 512K as their entire retirement plus SS and Medicare

      Reply

      • Posted by Rex the Wonder Dog! on August 9, 2019 at 2:19 am

        450 “sick days” = $512K payout…????… that equals $1,138 per day. The sick day pay outs should be based on the value of the sick day on the day it is earned, not when the guy is maxed out as Chief. 450 days/38 years = 12 sick days per year. He never took ONE sick day n 38 years? Bullshit.

        Reply

        • Posted by E on August 9, 2019 at 7:48 am

          The 450 days included vacation and comp days. He probably had a couple hundred hours of comp and had banked some vac days.
          I agree with you on the sick cap. If anything officers should be encouraged to roll the unused sick time into a 457 account. I have done that for years.
          An officer needs to protect himself from an off duty injury. Our policy is that for an off duty injury(broken ankle skiing etc) we need to use 40 of our sick days. Then we get four months of “salary continuance”. (Disability time I guess) and then we need to use the rest of our sick time at which point once we run out of time we don’t get paid or the town can move to involuntary retire us on a disability. The bad kind that pays a 40% pension.
          I encourage guys to bank 80 days to protect against two 6 month injuries in case you get hurt. Once at 80, unless you are making out your 457 plan, roll the days into that. I did that for years until recently when I have been making out the last 5 or so.
          We get 12 days a year, and cash them in for half pay. 6 a year. Being able to roll 6 days in a year, is a reasonable incentive to not have officers take a “mental health” day. If your sick your sick and stay the fuck home. But if you not, get your ass to work. Overtime is more costly than cashing those days in.
          I feel an 80 day cap with once you hit the 80 you can’t bank and all current sick days expire in Jan of the next year. (Use it or lose it will have everyone using it and be more costly due to manpower replacement). We run min staffing st least 20% of the time before people take vac and stuff. So figure it is almost half the time. When do u think the sick time will happen? And no cashing in unused vac days.
          Comp time is different and by federal law must be cashed in if it is not used. The limit there is 400+ hours. (Garcia decision—bus driver).

          Reply

          • Posted by E on August 9, 2019 at 7:59 am

            And the 80 days at career end (if an officer has that much) would really be a 40 day payout. Or 2 months of work. The high end of these payouts would be in the $30k range. Much better than the $500 payouts and much better than ballooning your overtime budget.
            Currently we can bank as many as we don’t use in a given year up to retirement for half pay. I would not be opposed to changing that. However, our dept is now half full of post 2010 guys that can only bank $10k or $15 not sure which. Among the rest of us only 1 guy has less than 18 years. The town would already be on the hook for what the old guys have earned. So basically they would be giving up something at contract time for that. It is not that big up a deal for them anymore because they will lose most of the tier 1 guys(including el Gaupo) within 10 years and most of them will be gone within 5-6.

  4. Posted by Tough Love on August 7, 2019 at 10:47 pm

    And quoting chief Zacche …………….

    “”I will never be able to afford COBRA.”

    Though sh** ! Private Sector workers VERY rarely get employer-sponsored retiree healthcare benefits, and neither should you. Just wait until COBRA ends, and you’ll have to pay AGE-based full-freight insurance premiums. The COBRA will seem cheap !

    Reply

    • Posted by E on August 8, 2019 at 7:43 am

      Yea it is a very strong penalty. However, he was the boss of a large city. And he DID know better. There are several job related offenses that result in the loss of pension. Mostly integrity relates.
      I wouldn’t worry to much about his health care. He stayed a whopping 38 years. (Way to long—-that’s how you get into trouble—ask the old Wyckoff Chief.). He’s gotta be pretty damn close to 65.
      Perhaps the penalty is too harsh I don’t know. But he did in fact know what he was doing was wrong. I can say with no doubt that the handsome one would NEVER do that. How stupid to throw your pension away like that.
      Oh well. Maybe the next chief will learn from his mistake.
      Well there you have it. As the ONLY reason TL “off topiced” is again is that she wanted to hear my opinion and perhaps turn some of the folks on here against me. Lol. Here’s a tip—-they still think you’re a jealous windbag.
      Que the outrage over the sick pay (which I agree witb that reform—and would’ve been completed for current employees as well in 2010 but Christie wanted no payout instead of $7500). As if that’s a lot of dough for a whole career). And que my retort absout the JC contract needing to be reopened in the middle at the city request because they were losing guys left and right. Never heard of a city that won an arbitration decision reopening a contract to give back what they had won.
      She is so predictable. And jealous. She’s be all the that Anderson fellow too if he gave it back to her. He wisely ignores her. That’s my flaw. I try to get a rise out of her. She sucks…

      Reply

      • Posted by stanley on August 8, 2019 at 9:52 am

        Lighten up Constable! How likely is it that Phil’s $31K in benefits for work not performed was his once and only offense. If that were the case, he would not have done it. A very severe penalty is necessary to punish a very grievous offense and to send a message to other policemen. And to let the public know that no one including the police is above the law.

        Reply

      • Posted by Tough Love on August 8, 2019 at 8:10 pm

        Quoting El gaupo ……………

        “As the ONLY reason TL “off topiced” is again is that she wanted to hear my opinion and perhaps turn some of the folks on here against me. ”

        Against “you” or against ………. all ludicrously excessive, unnecessary, and unaffordable Public Sector pensions ?

        Reply

        • Posted by E on August 9, 2019 at 8:01 am

          You off topic every chance u get…. like this is your blog or something. Start you own if you don’t like Johns topics. Instead of hijacking this one because you can’t stand me (and what I represent)

          Reply

          • Posted by Tough Love on August 9, 2019 at 11:03 am

            Told you before …………. I don’t “dislike you” (don’t even know you)……….. but yes the Taxpayers shouldn’t be forced to provide or fund (or be “responsible for” even if not currently funding) your ludicrously excessive, unnecessary, and unaffordable pension and benefits.

          • Your opinion….and
            you’re not forced. You can 1) move
            2) run for office and change things, or
            3) don’t pay your taxes and see what happens—-you know— the revolution you keep talking about. 😂I’m assuming you still have a mortgage, so that one will be tough.
            Move to Sunny Springs, or whatever the hell place you love in Georgia is called. Lol. Utopia?

          • Posted by Tough Love on August 9, 2019 at 3:21 pm

            El gaupo,

            No “revolution”, just an end to the unnecessary, unjust, unfair to Taxpayers, unaffordable, ludicrously excessive DB pensions, and benefits (both while active and retired) that are VASTLY more generous (and hence more costly) than what Private Sector workers typically get from their employers.

            No matter what YOU think, you”re not “special” and deserving of a better deal ….. on the Taxpayers’ dime.

          • Posted by E on August 9, 2019 at 6:38 pm

            Doesn’t matter what either of us think. I’ll get my pension. Thanks. Nothing will change for me. It’s a nice feeling.
            And I deserve whatever I can negotiate with my employer. Sorry you don’t get such a nice pension. 😭😭😭😭😭😢😥😥

          • Posted by Tough Love on August 9, 2019 at 10:19 pm

            Hopefully, the Taxpayers will prevail in the endgame, and unjust/excessive amounts (especially those granted by Elected Officials BOUGHT with Union campaign contributions) will ultimately NOT be paid.

            Doesn’t really have much effect on me personally, but it would certainly be an appropriate and just outcome …….. with the “moochers” losing.

          • Doesn’t have much effect on me personally…..she says.
            Of course not. As I said, you’re entire police salary budget costs you maybe 6-7 hundred a year. $2 a day. It’s all jealousy. I don’t feel slighted because Tom Brady just signed for more millions in his forties. If it doesn’t affect you….why do you obsess so much about it? I can see the school portion of your taxes per se.
            If my pension goes south, it’s becuae the whole state has and your home won’t be worth shit. Be careful what you wish for. Jealous plain and simple. You’ve never denied that have you?
            You’re pathetic TL. I’m sorry but you really are.
            Doesn’t really effect you (if it does that means your living above your means) but hopefully my pension isn’t paid. Lol. Fuck you TL.
            It’ll be paid. Whether it affects you or not. 😎.
            Sorry you hate me (and apparently most if not all cops).
            You need to stop wishing I’ll will on something that”doesn’t effect you”.
            Sorry you’re life didn’t turn out better. Still hope YOUR salary and bennies aren’t ever cut. Does t effects me so why the hell would I? Strike that. I do know. Loser.

          • Posted by Tough Love on August 10, 2019 at 1:44 pm

            El gaupo,

            I did my own est and came up a bit higher (likely because I included a proper cost of your absurd pension and benefits) ….. a bit under $1,100 per year per household. But like many other #s Unions (and others who dislike transparency) like to put forth, it’s hard to determine what to make it it ….. high ? low? about right ?

            You see, what really matter is …… are we overcompensating the Police. And by EVERY reasonable metric we ARE, and by a VERY large amount.

            YOUR annual compensation (wages, current benefits, pension & benefit accruals) is now about $250K …. patently absurd by any measure.

          • High finance guys compensation—patently absurd. However, u don’t hear me saying I hope they lose what they have. I don’t care

          • Posted by Tough Love on August 10, 2019 at 2:53 pm

            El gaupo,

            YOU don’t pay for what the High Finance guy earns, his clients do AND can chose OTHER advisors if they feel that they are paying too much for the service provided.

            Taxpayers are WITHOUT doubt OVERCOMPENSATING you …. and we have no choise as to the service provider.

            ————————————–

            I don’t want to to lose what you’ve “earned” ……….. just the 50+% of your total comp (primarily in the pension & benefit components) that was NEVER justifiable nor “earned”.

          • Shut up and pay dopey. If u can’t afford ur property taxes, move to Sunny Springs. lol.

          • Posted by Tough Love on August 10, 2019 at 7:16 pm

            El gaupo,

            The mantra of Public Sector “moochers”, telling Taxpayers to ………… “shut up and pay” ….. just so that they can continue to get pensions and benefits that often cost Taxpayers 10 TIMES what Private Sector workers typically get in retirement security contributions from their own employers.

            How do you spell “moocher” ?
            ——————————-

            Ever heard of Stein’s Law …………….. “If something cannot go on forever, it will stop.”

    • Posted by stanley on August 8, 2019 at 8:24 am

      “…you’ll have to pay AGE-based full-freight insurance premiums. The COBRA will seem cheap !”

      He can go on Medicare in 2.5 years and he is probably healthy enough to skip insurance until then. He has assets of $1M and I’m guessing that he will still get about $2400 per month from his pension. His wife works and will probably get Social Security. His cut in her SS will probably pay for his Medicare premium. He might not be able to afford the taxes on his $500K house. Maybe move to Alabama, get something less expensive?

      I wonder how many people would think that he is receiving excessive punishment. What about other policemen? I bet that what he did is so commonplace that the police consider it business as usual. Maybe he won’t have a retirement of plenty and ease? Inflation will bugger the heck out of that $2400 per month.

      Reply

      • No. He gets zero pension. Nothing.
        As I stated earlier; he deserves what he gets because he knew the rules.
        And Stanley, as a police officer and can tell you that it is NOT common. At all. You are free to think otherwise. But you would be wrong. He was the boss and not only did he allow it but he took part in it. Toxic culture from the top.
        The issue I think that gave TL pause momentarily at least, is that is someone committed a similar infraction in the private sector would they in fact lose their pension. That would depend on each individual situation. Because you know TL wants to be “equal”.
        But alas, good man you can’t have it both ways. If the police are held to a higher standard, as they should be particularly when it comes to integrity issues than it should stand to reason that their pensions should be higher as well. Right? Or so we have a problem witb equal????
        You know what is the thing that gets cops jammed up and in trouble the most??? Not the initial infraction. Everyone is human and makes mistakes. It is the lying. Sometimes I’ve seen what would normally just be a written reprimand turn into a suspension because they lied.
        “Yes I made a mistake and did that” is a lot better than “no I didn’t” followed by “I just wanted to stay out of trouble”.

        Reply

        • Posted by stanley on August 8, 2019 at 12:08 pm

          “No. He gets zero pension. Nothing.”

          I don’t believe that is correct. According to the story posted, the pension part that is based on his contributions continues in effect. I guesstimated that to be about 20% of the $12K per month pension. Maybe I should have used 10%?

          I don’t know if you can legitimately compare this case to a private sector case. You don’t find the early retirement practices in the private sector and when you do the pension is deeply discounted to reflect the longer payout period. And,,,,,most importantly, you don’t find the terribly extravagant pensions in the private sector. Top management might get a huge pension but that’s about it. And, they have to meet funding requirements in the private sector.

          Another problem facing Chief Phil is that he doesn’t have experience in living within his means–but he will get some experience unless his union can step in and get this whacking reversed.

          Reply

          • Uh….he is top management, Stanley. And he stayed in the job, stupidly, until his early sixties. Not an early retirement in the traditional sense.
            And I think once his contributions are returned, whether that is paid out monthly or in a lump sump, that’s it.

        • Posted by Rex the Wonder Dog! on August 9, 2019 at 2:11 am

          The judge’s order allows Zacche, 63, to retain only benefits based on money he contributed to his pension, but the state will no longer contribute its portion.
          He will only get what he contributed. I m really shocked his entire pension, all 38 years of it, can be yanked going back to Day #1. Usually they yank it juist back to the date of the crime, all contributions BEFORE that still count, including employer side.

          Reply

      • Posted by MJ on August 8, 2019 at 7:18 pm

        Stanley, I agree, probably not his first offense just the one he got caught on!

        Reply

  5. Posted by geo8rge on August 8, 2019 at 6:39 am

    If a senator wants to argue against the bailout:

    1) Make it a yearly appropriation, not a lump sum forever bailout.
    2) Since it is an arbitrary bailout demand that all pensions be equalized to the same average amount. My guess is about 2/3 of retirees will have a pension increase.
    3) Demand Sears and all other retirees be included.
    4) Although the headline numbers of retirees seem large, many have tiny insignificant pensions. The actual votes you may be getting by backing the legislation vs what you will lose by voting against it probably aren’t that large. Voting against it might be a lowcost way of being fiscally conservative.
    5) Toss out the Butch Lewis Act and replace it with a PBGC + Social Security (healthplans) bailout because the pensions are too corrupt to save. Replace the actuaries with dependable government bureaucrats.
    6) Given that the fashion these days is to talk about race and gender issues, I suspect the big Teamster pensions go to one particular race and gender. This would also argue for item (2) above.
    7) Do it for the children. The Pension bailout makes it much harder to be a young person as it sets a precedent for even more resources going to the elderly.
    8) Watch the trailer for “The Irish Man” teamster mafia fantasy movie about the disappearance of Teamster boss Jimmy Hoffa, just in time for the vote on the Teamster bailout. Coincidence? The best reason to vote against the bailout is those that are benefiting from the bailout are too old and not numerous enough to make a difference. The point of the movie is glory days of the teamsters as a force in politics are in the now distant past.

    Big business and the government are trying to pull us down:
    You might be demonstrating a failure to show appreciation:

    Reply

  6. Posted by Tough Love on August 10, 2019 at 8:37 pm

    Thought a summary of name-calling from our local constable El gaupo would be in order…………

    So far …in just this ONE Blog post, El gaupo has called me (in comments):

    Jealous, windbag, sucks, pathetic, “fuck you TL”, shut up, dopey,

    Proud of that ?

    The REAL problem is that you KNOW that what I’ve been stating (about the ludicrously excessive generosity of your pension & benefits) is accurate, and you can’t seem to comes to terms with that because it means that you have been ripping-off your your town’s taxpayers for decades …… even if not (thanks to cooperating Elected Officials) a “crime”.

    —————————————————————————————

    Perhaps I’ve strayed, but I try to limit such name-calling to “moocher” because it fits so perfectly

    Reply

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