WASHINGTON - Thousands of retired truckers hit Capitol Hill on Thursday to ask Congress to rescind a law that might reduce their pensions by as much as 70 percent.
The participants in a troubled 400,000-member multi-employer pension fund called Teamsters' Central States Fund were there to protest a 2014 provision they say will impose financial hardships on retirees, such as bankruptcies, lost houses and the inability to buy medicines.
"This will kill people - this will maim people," predicted Mike Walden of Cuyahoga Falls, who retired after 31 years as a driver for Roadway Express. "This will lead to strokes and heart attacks when people can't afford their medications."
Teamsters General President Jim Hoffa said Congress should be willing to help out ordinary workers after it bailed out Wall Street.
"We will use every resource available to our union to stop these cuts," he said.
What's the problem?
Multi-employer pension plans like the Central States Fund are administered on behalf of employers and unions in industries where workers often move between companies in the same field.
Enough of them were endangered by poor returns during the last recession that Congress decided to act. The Central States Fund has $18 billion in assets and $35 billion in liabilities, with yearly payouts that exceed contributions.
What's the law?
To keep plans like the Central States Fund from going broke and potentially threatening the solvency of the beleaguered federal Pension Benefit Guaranty Corp., Congress passed legislation that would let them cut benefits. Only pension plans that projected they wouldn't be able to pay 100 percent of benefits within 10 to 20 years could qualify.
Backers of the measure said it would ensure retirees got some money and the federal pension guaranty corporation would stay afloat. They said that even in the worst cases, workers with at least 30 years of service would get slightly more under the deal than the $12,870 they'd get at retirement if their pensions were dumped on the federal government.
What's the truckers' perspective?
A payment slightly higher than the government guarantee is still much less than Central States retirees were counting on. They were chagrined when the fund's administrators said they'd use the new law to cut benefits.
They said Wall Street interests milked their pension fund for commissions instead of keeping it from losing money. Rather than penalizing those who mismanaged the fund, they accused Congress of shifting the burden to them.
"The union is getting smaller so they're trying to kick us to the curb and steal our pension money," said Oak Harbor retiree Jerry Collins, who fears the pension he earned after 34 years as a trucker will be cut by 60 percent and put him at "poverty level."
What's the solution?
The retirees say they back a bill sponsored by Democratic presidential candidate Bernie Sanders and Toledo Democratic Rep. Marcy Kaptur that would channel more money into the Pension Benefits Guarantee Corp. by eliminating two tax breaks enjoyed by the wealthy.
One break protects taxation of certain high-end real estate sales that are characterized as property "exchanges," with some taxes now put off indefinitely. The other concerns tax avoidance on estates with valuable holdings such as artwork.
The retirees have also asked the Treasury Department to deny the benefit reduction application that their pension administrators submitted under the new law. A decision is due on May 7.
Sen. Rob Portman, an Ohio Republican, has proposed a bill that could force plan trustees to negotiate with retirees and, Portman says, "let the democratic process work."
His bill would keep the Treasury Department from overruling any vote retirees could take against potential pension cuts and require that only filled-out ballots be counted. That would keep pension trustees from sending out ballots that are never returned and counting them among the votes in favor.
"You're the ones who are affected by it, you're the ones that should have a voice and should have a seat at the table," Portman told the crowd.