WASHINGTON – Senate Democrats blocked a motion by U.S. Sen. Chuck Grassley (R-Iowa) to push for structural fixes to troubled multiemployer pension plans in their partisan $1.9 trillion COVID spending package. Instead, Democrats opted for an $86 billion bailout with no strings attached, all but guaranteeing that taxpayers will be on the hook for future intervention to rescue the failing retirement plans.
“This bailout is not coupled with any reforms to ensure the long-term sustainability of the multiemployer pension system. So, it’s just a blank check, with no measures to hold mismanaged plans accountable. That’s why I spent much of last Congress working on a responsible proposal to rescue and reform the failing multiemployer pension system. Unless meaningful reforms are included, the precedent will be set that the taxpayer, not the PBGC, is the ultimate guarantor of private-employer pension promises,” Grassley said.
This week, Grassley reintroduced legislation to put troubled multiemployer pension plans on a path to sustainability and address the challenges facing the Pension Benefit Guarantee Corporation, which insures the plans and is projected to become insolvent in five years. Grassley’s motion during debate on the Democrats’ partisan spending bill would have sent the pension bailout provision back to the Senate Finance Committee, where it could be amended to include more responsible and sustainable policies, like Grassley’s bill. The motion failed to advance by a vote of 49-50.