Zerohedge: “I Guess It’s Food Stamps”: 400,000 Americans In Jeopardy As Giant Pension Fund Plans 50% Benefit Cuts

http://www.zerohedge.com/news/2016-02-18/i-guess-its-food-stamps-400000-americans-jeopardy-giant-pension-fund-plans-50-benefi

Dale Dorsey isn’t happy.

After working 33 years, he’s facing a 55% cut to his pension benefits, a blow which he says will “cripple” his family and imperil the livelihood of his two children, one of whom is in the fourth grade and one of whom is just entering high school.

Dorsey attended a town hall meeting in Kansas City on Tuesday where retirees turned out for a discussion on “massive” pension cuts proposed by the Central States Pension Fund, which covers 400,000 participants, and which will almost certainly go broke within the next decade.

“A controversial 2014 law allowed the pension to propose [deep] cuts, many of them by half or more, as a way to perhaps save the fund,” The Kansas City Star wrote earlier this week adding that “two much smaller pensions also have sought similar relief under the law, and still more pensions are significantly underfunded.”

“What’s happening to us is a microcosm of what’s going to happen to the rest of the pensions in the United States,” said Jay Perry, a longtime Teamsters member.

Jay is probably correct.

Public sector pension funds are grossly underfunded in places like Chicago and Houston, while private sector funds are struggling to deal with rock bottom interest rates, which put pressure on expected returns and thus drive the present value of funds’ liabilities higher.

Illinois’ pension burden has brought the state to its knees financially speaking and in November, Springfield was forced to miss a $560 million payment to its retirement fund. In the private sector, GM said on Thursday that it will sell 20- and 30-year bonds in order to meet its pension obligations.

At the end of last year GM’s U.S. hourly pension plan was underfunded by $10.4 billion,” The New York Times writes. “About $61 billion of the obligations were funded for the plan’s roughly 360,000 pensioners.” Maybe it’s time for tax payers to bail themselves out.

Speaking of GM, Kenneth Feinberg – the man who oversaw the distribution of cash compensation to victims who were involved in accidents tied to faulty ignition switches – is now tasked with deciding whether the Central States Pension Fund’s proposal to cut benefits passes legal muster. “Central States’ proposal would allow the retirees to work and still collect their reduced benefits. But some are no longer able to work, and the idea didn’t seem plausible to others,” the Star goes on to note.

“You know anybody hiring a 73-year-old mechanic?” Rod Heelan asked Feinberg. “I’m available.”

“I’ll have to go find a job. I don’t know. I’m 68,” Gary Meyer of Concordia, Mo said. “It would probably be a minimum-wage job.”

To be sure, retirees’ frustrations are justified. That said, the fund is simply running out of money. “We simply can’t stay afloat if we continue to pay out $3.46 in pension benefits for every $1 paid in from contributing employers,” a letter to retirees reads.

The fund is projected to go broke by 2026. Without the proposed cuts, no benefits at all will be paid from that point forward.

According to letters shared with The Star, cuts range from around 40% to 61%. “[The] average pension loss was more than $1,400 a month,” the paper says.

As for what will become of those who depend upon their benefits to survive, the above quoted Gary Meyer summed it up best: “I guess food stamps. Hopefully not. It would be a last resort.”

Don’t worry Gary, you aren’t alone…

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5 Responses to Zerohedge: “I Guess It’s Food Stamps”: 400,000 Americans In Jeopardy As Giant Pension Fund Plans 50% Benefit Cuts

  1. Tracy says:

    I read this article on ZH and the “nasty” comments by those hedge funders who schill these financial products, well “shame” on them (most felt this man [implied as on government teat] who is complaining is an idiot & deserved what is happening .) After looking at the link provide I found he is a “Teamster” and they are fighting to save cuts to their pension. I think this falls into the “grey area” as in whether he’s a government worker or hired “contractor”? If I recall were they Teamsters the “poster schill” for the 2008 election to tell their fellow Americans whom to vote for?….sorry I digress.
    What this article tells me is this is an “indicator” or the canary in to coal mine if you will; of what is happening to all “retirement” plans, this corporate & government agreed system is “BROKEN”, akin to collapsing the house of cards under its own weight. You can’t ask people to invest saving and give them smaller and smaller interest/ROI incentive for doing so; you can’t expect people to have less children from the “over population meme” (affects populace demographics by shrinking payments for the prior generations/benefiter’s who are living longer); you can’t tell people to “spend more” to pump up the economy when they are losing jobs, many with much higher debt (from the government memes to buy bigger expensive homes and we’ll help you qualify, or go to school we’ll help you pay for it, etc.) people having to work harder/longer hours for much less income that does not keep up with “inflation” for decades.

    All the while “hyper inflating” expenses: taxes, fees, premiums, price-fixing, et. al from a mutual government/private corporation partnership; A partnership in which all who participate promote this “house of cards” debt cycle shilling their wares by statue, and via monopolized markets. It’s a one-two punch against the people/the conned-sumers, who no matter what they do they are getting backed into a corner; unless they choose to live in almost abject poverty to pay for IMO the “Rico-Crimes”. And “yes” I also agree there is something to be said about “personal responsibility” so nobody is getting a free pass; however this is a “racket” coming and going, people are/have been programmed to “max out the debt” don’t worry “we’ve got you covered” aka: the government/corporate prostitutes doing the business of PRIVATE BANKING CABAL VENUE.

    IMO this is/was a planned “implosion” (a making of many decades) by “the private & government corporations that have kept the people in perpetual slavery” while siphoning profits & benefiting from “tax loopholes” to live like kings & queens. The BABYLON DEBT SLAVERY SYSTEM IS BROKEN AND IT NO LONGER WORKS, THE GIG IS UP. We have grown past this illusion (I believe) it’s up to us how we progress forward as a “people” of this great EARTH to rebuild our lives without “con-struct” a life of “organic/holistic means” where “everyone is a stake holder” and life success is measured by the best most benevolent outcome for ALL, and nothing to do with MONEY/DEBT/SLAVERY/POVERTY/SICKNESS/WAR, et AL. That is if we don’t perish in the process. Sending my LOVE to ALL we most certainly need it IMO. ❤

    & thank you Jean for doing your best to report what you feel is important for us to know w/or w/out the censor. 🙂

  2. By Walter Burien, advocate for government fiscal accountability and budgeting.

    CAFR – the holy grail of government overall accounting

    All local governments across the land say they are short of funds because they are projecting liabilities out 35-years cross-matched with projections of income 1-year out. The same applies for every City, County, School District, University, Enterprise Operation, Court.

    You may want to look at the CAFR listing put up a few months ago. 4500 CAFRs categorized. Then you yourself can bypass the void intentionally created by the Fox and share that page with many. http://CAFR1.com/listings/Listings.html

    Canada has a CAFR for their local governments. In Canada it is the CAnFR (Canadian Annual Financial Report) http://private-person.com/blog/2012/09/the-cafr-swindle-the-biggest-game-in-town/

    http://canadianliberty.com/?tag=comprehensive-annual-financial-report

  3. Jean says:

    Deborah, this is totally crazy – and I’m sorry, but I just can’t publish it. Thanks and hugs, ~Jean

    People who are dreamers may be fans of Sheldon Nidle, who has telling us forever that we will be saved. Planet X from what I’ve learned is a product to create fear by NASA. Please, check some of these things out before you put it up here.

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