Companies with underfunded pension plans would get relief for three years under legislation backed by the U.S. House of Representatives Ways and Means Committee on Friday, in an acrimonious session to which police were called.
Under the measure that the committee approved, traditional “defined benefit” pension plans would be allowed to assume a more generous return on investments based on an index of high-grade corporate bonds rather than the current formula based on 30-year U.S. Treasury bond yields.
But critics say changing the method of valuing the funds is an accounting device that doesn’t address the shortfall.
Companies will be allowed to SAY they are getting higher returns on their pension savings than they really ARE making. And just how bad is the problem?
Total pension underfunding exceeds $300 billion at U.S. companies, with $60 billion in the auto industry, according to the agency that bails out troubled corporate pension plans.
That’s right – the companies are $300 billion in the hole owed to pensions – but it is not on their books for purposes of evaluating investments in the companies. Hence the new stock market bubble.
Think about this – those companies that still give pensions don’t have enough money saved up to PAY the pensions, and the Republicans are letting them off the hook here. Meanwhile, our Social Security money went away to pay for the huge Bush tax cuts! So the ENTIRE “baby-boomer” generation is losing its pensions, its Social Security and those lucky enough to have had jobs with 401Ks, well, half of that’s gone, too. It MATTERS who wins elections!
And, by the way, how did the Republicans get this passed?
The measure was rushed through by the Republican majority as Chairman Bill Thomas of California called a voice vote while committee Democrats were conferring over last-minute changes in an adjacent library.