Re­tirees still des­per­ately seek­ing fix for pen­sions

The Columbus Dispatch - - Front Page - By Jes­sica Wehrman The Colum­bus Dis­patch

WASH­ING­TON — Rita Lewis ac­cepted Sen. Sher­rod Brown’s in­vi­ta­tion to the State of the Union ad­dress this year with a sin­gu­lar thought in mind: Per­haps she could once again draw at­ten­tion to the plight of the nearly 1.3 mil­lion re­tirees at risk of los­ing their en­dan­gered pen­sions.

The West Ch­ester woman’s hus­band, re­tired truck driver Butch Lewis, died on New Year’s Eve 2015 wor­ry­ing about the pen­sion cri­sis and its im­pact both on him and his fel­low re­tirees. When he died, Rita Lewis took up the fight.

More than three years later, the prob­lem still looms.

Last year, a joint com­mit­tee of House mem­bers and se­na­tors vowed to solve the prob­lem of what to do with trou­bled multi-em­ployer pen­sions. They had un­til Nov. 30 to come up with a so­lu­tion. They missed the dead­line, but Brown and fel­low Ohio Sen. Rob Port­man, who have more than 60,000 con­stituents sad­dled with these trou­bled plans, vowed to press on.

But now, two months into the 2019, a so­lu­tion that both sides can agree on re­mains out of reach. For Rita Lewis and other af­fected re­tirees, it’s a unique brand of pur­ga­tory, tem­pered by high hopes and deep dis­ap­point­ments.

“We al­ways get so close to some­thing, then there’s a ma­jor devel­op­ment, whether it’s a hur­ri­cane or a dis­as­ter and the peck­ing or­der changes,” she said.

“I’m told it’s a pri­or­ity,” said Mike Walden, head of the Team­sters’ Na­tional United Com­mit­tee to Pro­tect Pen­sions. “It’s just the (fed­eral gov­ern­ment) shut­down

has taken away some things and read­justed the pri­or­i­ties.”

Walden, a re­tired truck driver from Cuya­hoga Falls, was a mem­ber of the Cen­tral States’ pen­sion pro­gram— a multi-em­ployer pen­sion that al­lowed em­ploy­ers to pool re­sources and pro­vide work­ers with re­tire­ment se­cu­rity.

The plans, ne­go­ti­ated by unions, were ad­min­is­tered by trus­tees se­lected by the union and em­ploy­ers and were a key part of col­lec­tive bar­gain­ing. Many of those in the Cen­tral States plan, of­fered the choice of higher salaries or bet­ter re­tire­ment, chose the lat­ter. But by the mid-2000s, that choice sud­denly went bad; the re­tire­ment of the baby boomer gen­er­a­tion and a va­ri­ety of other fac­tors put the pen­sions at risk.

In 2015, Cen­tral States of­fered a pro­posal that would slash re­tirees’ ben­e­fits. The Trea­sury Depart­ment ul­ti­mately re­jected that plan, and the pen­sion­ers have re­mained in limbo ever since.

The fund con­tin­ues to bleed money: The 2018 third quar­ter Fi­nan­cial and An­a­lyt­i­cal Re­port on the Cen­tral States Team­sters Fund, thep­en­sion that Butch Lewiswas in,found it had $14.1 bil­lion in as­sets as of Sept. 30, 2018— $1 bil­lion less than the start of 2018.

Brown, a Demo­crat who co-chaired the joint com­mit­tee tasked with solv­ing the prob­lem, has vowed to keep fight­ing. Even as he weighs a bid for the White House, he in­sists his com­mit­ment to solv­ing the prob­lem Rita Lewis at­tended the State of the Union ad­dress in Wash­ing­ton last month as the guest of U.S. Sen. Sher­rod Brown. The Butch Lewis Act — which aims to re­form and sta­bi­lize worker pen­sions — is named for her hus­band, who died on Dec. 31, 2015.

hasn’t changed. Last year, he in­tro­duced a bill named af­ter Butch Lewis that aimed to end the cri­sis by creat­ing a loan pro­gram for plans in crit­i­cal, de­clin­ing and in­sol­vent sta­tus.

“Ex­cept for keep­ing the gov­ern­ment open, there is no greater leg­isla­tive pri­or­ity in my mind,” he said.

Port­man, a Repub­li­can who also served on the com­mit­tee, was named this year to chair the Se­nate Fi­nance Com­mit­tee’s Sub­com­mit­tee on So­cial Se­cu­rity, Pen­sions and Fam­ily Pol­icy. He also said the en­dan­gered pen­sions are very much on his mind.

Let­ting the pen­sions fail, he said, “would hurt the en­tire econ­omy.”

“I hope we’ll be able to use this fo­rum, this sub­com­mit­tee

to be able to get back to where we were at the end of last year, when we were very close to an agree­ment,” he said, not­ing that so­lu­tion would likely in­clude “shared re­spon­si­bil­ity” with pen­sion­ers, com­pa­nies, re­tirees and the gov­ern­ment weigh­ing in to fix the prob­lem.

Else­where, the en­vi­ron­ment has shifted. With Democrats now hold­ing the House ma­jor­ity and Rep. Richard Neal, the chair­man of the pow­er­ful House Ways and Means Com­mit­tee, serv­ing as the main House backer of the Butch Lewis bill, it seems plau­si­ble, if not likely, that the House will pass that mea­sure. But its chances in the Se­nate re­main grim.

The con­ven­tional wis­dom is that the longer Congress waits to act, the worse it will get. Among the key wor­ries is the “con­ta­gion ef­fect”— the idea that if those pen­sions fail, oth­ers will fol­low, cas­cad­ing to cre­ate a fi­nan­cial cri­sis.

David Brenner, se­nior vice pres­i­dent and na­tional di­rec­tor of multi-em­ployer con­sult­ing for Se­gal Con­sult­ing, said the gov­ern­ment has an obli­ga­tion to help be­cause it con­trib­uted to the short­fall in the first place.

The dereg­u­la­tion of the truck­ing in­dus­try in the 1970s— a gov­ern­ment ac­tion— as well as mar­ket crashes be­cause of a dereg­u­la­tion of Wall Street con­trib­uted to the af­fected pen­sions' trou­bles.

“When you look at the roots of the prob­lem, the gov­ern­ment has a very heavy hand in it, which is some­thing not a lot of peo­ple pay at­ten­tion

to,” he said.

De­spite the com­mit­tee's fail­ure so far, he is op­ti­mistic.

Brenner said that if the pen­sions de­fault, the gov­ern­ment might ul­ti­mately be on the hook.

“If these plans go un­der, where are peo­ple go­ing to go? They’ll start re­ly­ing more on the so­cial safety net and gov­ern­ment pro­grams. One way or the other, some­one’s go­ing to pay for this.”

Walden pre­dicts that there will be lit­tle ac­tion on the is­sue un­til March or April, as Congress deals with the af­ter­math of the shut­down and ba­sic or­ga­ni­za­tional work.

He said there has been some­thing of a sea change among Repub­li­cans, an ur­gency that may trans­late to ac­tion.

“Peo­ple are con­cerned on both sides of the aisle,” Walden said. “We’re all just kind of wait­ing around to see what they come up with be­fore we make our next move.”

Both he and Rita Lewis are trou­bled that so lit­tle at­ten­tion is be­ing paid to the is­sue. When the gov­ern­ment shut down, 800,000 peo­ple lost their pay­checks. Though it was ap­pro­pri­ate that so many wor­ried about them, they ar­gue that the pen­sion cri­sis mer­its at­ten­tion, too.

“We just went and spent $11 bil­lion on the shut­down,” said Rita Lewis, re­fer­ring to the costs of clos­ing the gov­ern­ment for 35 days. “We could’ve used that money to se­cure our pen­sions.”

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