America Is Facing A Pension Crisis. Retirees Will Pay The Price If We Don’t Act Now
The comments below are an edited and abridged synopsis of an article by John Boehner and Joe Crowley
Millions of retirees and workers are at risk of losing their pension benefits, because their plans will likely become insolvent in the near future. Today’s crisis also puts the US on the path toward a systemwide collapse, and the elimination of billions in retirement dollars and tens of thousands of jobs.
Today’s crisis is the result of many factors. In addition, some employers in multi-employer pension plans have gone bankrupt, forcing the employers that remain to assume financial responsibility for the bankrupt employer’s former workers, or orphan participants.
Inaction leaves Americans out to dry: The widowed grandmother whose financial stability depends on her husband’s pension, the aunt and uncle who rely on their pensions after health problems forced early retirement, and young new employees, excited about their first job, but scared they may never see retirement benefits.
Left unchecked, this crisis will decimate the retirement future of millions. The number of retirees is increasing, while the number of active participants and employers is decreasing. This imbalance, combined with the market decline from the Great Recession, has put many pension plans on an unsustainable path.
Several large pension plans in the US are headed for trouble. The collapse of the system would further compound the pension crisis at hand and have a domino effect on the US economy, potentially leading to widescale business closures, layoffs and rising unemployment.
Doing nothing to address this crisis is unconscionable. It’s important that the public sector and private sector work together now to fix the multi-employer pension plan system.