Friday, September 26, 2008

Unions Want Congressional Pension Protections

The financial bailout of the financial markets, a Hail Mary play to be sure, may cost US taxpayers in excess of $700 billion. That's about $2,500 McDonald's apple pies per American as one late night funster commented. It's also about 220 Rolexes or 175 Prada bags (I need to go shopping).

Already organized labor is positioning itself. Instead of wanting a piece of the $700 billion pie, it wants Congress to add money to the pot to protect employee pensions.

Jimmy Hoffa, Jr's Teamsters Union, which boasts over 200,000 retirees, fired off a missive to Congress this week asking for money to bail out union pension funds which were negatively impacted by losses in the investments that backed those pension funds. If one considers that most pension funds for large-scale employers rake in about 7% from their investments, the fact that these funds have been getting spanked in the markets is a terrifying thought to retirees, let alone active employees. What the Teamsters and other union want is for the government to skip the penalties they would normally impose on employers whose pension fund management decisions preclude their pensions from paying out as promised. Instead, they ask the Feds to give thees employers extra time to make up the shortfall cause by their tanked investments.

Teamsters and other unions also support limits on executive pay. But that's another post.