Glen Heck spent 28 years sweating in a Campti, La., paper mill that he likes to say was âhotter than nine kinds of hell.â
But now, Heckâs sacrifice may have been for nothing because his multiemployer pension plan is one of aboutÂ 150 nationwide set to go broke. If that happens, the 78-year-old Heck will have to find a cheaper, lower-quality health plan and keep the beef herd heâs itching to sell.
TheÂ Democratic-controlled House passedâwith bipartisan supportâa commonsense planÂ to save Heckâs pension and those of another 1.3 million workers, retirees and widows. But Republican leaders in the Senate refuse to consider it.
In the meantime, the futures of workers and retirees like Heck hang in the balance. Many face retirement with fear instead of anticipation.
Multiemployer pension plans like Heckâs include workers from two or more companies in industries such as transportation, entertainment, construction and paper.Â Employers make contributions for workers as part of their compensation.Â Heck and others often give up wage increases or other benefits to fund those plans.
ManyÂ of the 1,400 plans nationwide are still healthy. But through no fault of workers or retirees, about 150 are struggling.
Recessions in 2001 and 2008 cut the plansâ investment earnings, andÂ some corporations used bankruptcies to evade pension obligations. DeregulationÂ forced less-competitive companies out of business, straining the plansâ resources.
Now, they owe more money to beneficiaries than they have coming in, and theyâre at risk of collapsing. The PACE Industry Union-Management Pension Fund (PIUMPF)âHeckâs planâis one of them. According to recent projections, the fund will be insolvent in as few as 10 years.
Under the bill passed by the House, theÂ Butch Lewis Act, the Treasury Department would loan money to troubled plans. The plans would use the money to meet their obligations to retirees, and they would repay the loans over 30 years.
The federal government already has an agency, the Pension Benefit Guaranty Corp. (PBGC), to pay benefits to retirees when multiemployer plans crumble. But itâs no substitute for the Butch Lewis Act.
PBGCÂ provides only a fraction of the benefits beneficiaries earned. Also, so many plans are imperiledÂ that the PBGCâs insurance program itself is at risk of collapse.
If plans fail, workers and retirees will loseÂ as much as 98 percentÂ of their benefits. The Butch Lewis Act would ensure that they receiveÂ the money they earned, not pennies on the dollar.
Heck, a former officer with United Steelworkers (USW) Local 13-1331 in Campti, knows widows of paper workersâone with a small childâwhoâd be financially devastated without their late husbandsâ pensions. He knows a retiree with major health problems whoâd have no way of paying medical bills without his pension checks.
âHeâs just worried to death about it,â said Heck, who worked at the paper mill under a handful of operators, including current owner International Paper.
Cedric McClinton, president of Local 13-1331 and a technician at the paper mill, said pensions are the main source of retirement income for many workers and retirees. If those benefits get cut, thereâs no easy way to make up the difference.
âYouâre either looking at working longerâand who wants to work until youâve got one foot in the grave and the other on a banana peelâor youâre looking at making concessions after youâve worked all that time,â McClinton said.
Workers worry about downsizing their homes, giving up travel plans and going on government assistance programs.
âWe talk about these things all the time,â McClinton said. âItâs real.â
Instead of passing the Butch Lewis Act to fix the pension crisis, Senate Republicans introduced legislation that would make the problem worse.
Sens. Chuck Grassley of Iowa and Lamar Alexander of Tennessee wantÂ to increase the premiumsÂ that retirement plans pay PBGCâsomething that would push currently healthy plans into financial ruin and put more workersâ retirements in jeopardy. The added costs also would propel someÂ employers into bankruptcy, costing workers their jobs.
Grassley and Alexander also want to increaseÂ taxes onÂ pensions, taking a bigger slice of the benefits workers earned and imposing a greater burden on retirees unable to afford it.
Workers and retirees didnât create the pension crisis. But Grassley and Alexander want them to pay for it.
âThatâs mind-boggling,â fumed Travis Birchfield, whoâs lobbied for the Butch Lewis Act on behalf of Evergreen Packaging workers represented by USW Local 507 in Canton, N.C. âWeâve done bailouts and tax cuts for millionaires and billionaires, and then working people canât get a damn loan?â
Uncertainty gnaws at Birchfieldâs co-workers. Some in their 60s are thinking about retirement, but hesitate because of the pension crisis.
âTheyâll ask us, âwhat do you think is going to happen?â We canât answer those questions,â Birchfield said.
McClinton and Birchfield pounded the halls of the Capitol to share membersâ stories and concerns. But Senate Republicans fail to get the message.
Pensions arenât perks or âextras.â Workers earned these benefits, and they rely on that money being there during their golden years, just as members of Congress count on receiving taxpayer-subsidized pensions when they leave office.
Failing to pass the Butch Lewis Act means consigning 1.3 million Americans to meager retirements. Some will fall into poverty after supporting themselves all of their lives. Many already see their dreams slipping away.
These hard-working men and women deserve immediate Senate passage of a responsible bill that safeguards their futures.
âNobodyâs trying to get rich here,â Birchfield stressed. âWeâre just trying to get our retirements.â
This blog was originally published by AFL-CIO on February 14, 2020. Reprinted with permission.Â
About the Author: Tom Conway is international president of the United Steelworkers (USW).