Sanders and Kaptur: Keep our pension promises, no cuts to promised benefits

The US Treasury Department on September 10 held a hearing on the implementation of the Multiemployer Pension Reform Act, a law passed last year that allows financially troubled multi-employer pension plans to reduce promised benefits.

Outside of the hearing, Sen. Bernie Sanders and Rep. Marcy Kaptur held a media conference urging support for their Keep Our Pension Promises Act (KOPPA) bill, which establishes a fund administered by the Pension Benefit Guaranty Corporation (PBGC) that would be used to maintain promised pension benefits when multi-employer pension funds experience financial trouble.

“We have to send a loud and clear message—when a promise is made to working people, that promise must be kept,” said Sen. Sanders. “We can’t slash pensions in this country. If we stand together, if all Americans stand together, we can win this fight.”

“Your pension benefits are your earned benefits and you have a right to them,” said Rep. Kaptur to retirees attending the media conference. “I am proud to stand with you.”

There are 1400 multiemployer defined benefit pension plans in the US that serve 10 million workers and retirees. These pension plans provide retirement benefits for  workers in certain industries in which workers routinely work for a number of different employers, such as construction, transportation, and hospitality businesses.

More than 90 percent of these funds are in good to fair financial shape, but a handful are in critical condition and could run out of money some time in the next 20 to 30 years.

To deal with this problem, the National Coordinating Council for Multiemployer Plans, the trade association for these multiemployer plans, convinced Congress to pass the Multiemployer Pension Reform Act (MPRA).

The MPRA solution for dealing with pension fund financial troubles is to make retirees and workers bear the cost for making the pension plans whole again by reducing benefits.

Sanders’ and Kaptur’s KOPPA on the other hand allows financially troubled plans to avoid benefit cuts by creating a pool of money that could be used to avoid benefit cuts when multiemployer plans face financial difficulty. The pool would be funded by eliminating two loopholes used by the wealthy to avoid paying taxes.

One of these loopholes is called like-kind exchange, which allows wealthy investors to defer indefinitely their capital gains taxes on certain investments.

The other is called the minority valuation discount, which allows people receiving gifts or inheritances of $5 million or more to receive discounts that substantially lower their tax liabilities.

Government analysts estimate that the elimination of these two loopholes would save $18 billion over ten years.

If KOPPA passes, these savings would be used to create a Legacy Fund administered by PBGC. The money in the Legacy Fund would be used to pay a portion of the pension benefits owed by a multiemployer pension plan facing financial difficulties until the plan returns to financial health.

One of the multiemployer plans facing critical financial difficulties is the Teamsters Central State Pension Fund, which currently provides pensions to 208,000 retired Teamsters, whose average yearly benefit is estimated to be $8580 a year or $715 a month.

These retirees and tens of thousands active workers are facing possible pension reductions in 2016.

If KOPPA passes, these benefit cuts will be avoided.

Jim Hoffa, general president of the Teamsters and a number of retired Teamsters joined Sen. Sanders and Rep. Kaptur at their media conference and urged passage of KOPPA.

“We’re here to protect pensions,” said Hoffa at the media conference. “We have retirees here from all across America and this is just the beginning of our fight. Hardworking Americans have earned the right to retire with dignity.”

Teamsters for a Democratic Union (TDU), a caucus of rank and file members and some local union leaders, also supports KOPPA, but TDU accused Hoffa of flip flopping on the issue of supporting passage of MPRA and benefit cuts.

Hoffa sits on the board of directors of the Central States Pension Fund, which supported passage of MPRA, so that it could cut pension benefits to keep the fund alive and return it to financial health.

According to TDU, Hoffa secretly supported the passage of MPRA.

The Central States Fund on its website states that its financial troubles are the result of an aging workforce and a declining number of active workers and companies contributing to the fund.

Investment losses incurred during the financial crisis of 2008 also hurt the fund.

But TDU isn’t convinced that these are the only problems that have caused the decline of the fund, and it is calling for an independent audit before any pension cuts take place.

“(An audit) is a reasonable demand by members and retirees who deferred wage increase so they could have pension benefits they could survive on in retirement,” reads a TDU statement.

Sen. Sanders: Educate, organize, and mobilize to revitalize America

Speaking before a standing room only audience at a town hall meeting in Austin, Texas, Sen. Bernie Sanders of Vermont said that we need a political revolution that empowers ordinary Americans to revitalize the US.

Sanders said that wealthy campaign donors have used their wealth to capture control of the government and advance their private agendas.

As a result, the government is making bad political decisions that cater to the special interests of the rich at the expense of everyone else causing tens of millions of potential voters to become disengaged from politics.

Getting these disgruntled voters engaged in the political process is the only way to reverse the bad policy decisions that have cost us millions of good paying jobs and a disappearing middle class, burdened many young people seeking a college degree with oppressive debt, degraded our environment, and made health care too expensive.

“Politics is important to the rich, it should be just as important to the rest of us,” said Sanders to the overflow crowd at the IBEW Local 520 union hall.

Sanders has laid out a 12-point agenda for revitalizing America. Educating people about and organizing them around this agenda, said Sanders, is the key to mobilizing them for the fight to take back the government.

At the town hall meeting organized by the local chapter of the Democratic Socialist of America, Sanders elaborated on his  Agenda for America: 12 Points Forward.

Foremost on this agenda is Sanders’ proposal for creating millions of good paying jobs by rebuilding the nation’s infrastructure–roads, bridges, schools, water plants, sewage systems, railroads, airports and other public investments that make commerce, work, recreation, and education possible.

Investing in such an undertaking will be expensive, acknowledged Sanders, but not doing so will be more expensive.

If we don’t make the investment, commerce and other activities that constitute our every day lives will suffer and we’ll lose an opportunity to create millions of good paying jobs that can restore the middle class dream for many who have given up hope.

Sanders suggested that some of the money needed to rebuild our infrastructure could come from cutting the military budget.

“A $1 trillion investment in infrastructure could create 13 million decent paying jobs and make this country more efficient and productive,” said Sanders. “We need to invest in infrastructure, not more war.”

If we are to rebuild the middle class, said Sanders, American workers need a raise.

Since 1999, the average annual income of middle-class America has dropped by $5,000 in inflation adjusted dollars.

Forty million Americans are still mired in poverty despite the vast wealth that has been created in the last 40 years.

Several points in Sanders’ Agenda for America offer ways to give American workers a raise:

  • Make it easier for workers to join a union. Unions give workers the collective power to bargain for higher wages. In the past, stronger unions have meant higher pay for union and non-union workers alike.
  • Raise the minimum wage to $15 an hour. The current minimum wage of $7.25 an hour is a poverty wage. The federal minimum wage hasn’t been raised since 2009.
  • Eliminate the pay differential between men and women. Women currently earn 78 percent less than men for the same kind of work.
  • Raise Social Security benefits, expand Medicare to all Americans so that everyone has access to affordable quality health care, and expand federal nutrition programs.
  • Make college affordable for all. Too many students are leaving college with crushing debt. Making college affordable will create a larger pool of skilled workers, who will help the US maintain a competitive edge in the world economy.

Tackling the effects of climate change is also an important point on Sander’s agenda.

Climate change threatens to transform our environment in a way that will make life harder for all but the most wealthy.

Climate change can be halted by relying more on renewable energy such as solar and wind power.

Converting our economy to one that relies more on renewable energy will have the added benefit of creating millions of new jobs as new renewable energy technologies develop and mature.

Finally, if we are to stop the decline of the American middle class, said Sanders, we must stop bad trade deals such as the Trans Pacific Partnership (TPP), which the Congress will soon be considering.

Bad trade deals such as TPP and NAFTA are another example of bad decisions made to serve special interests.

Since NAFTA was ratified in the 1990s, millions of good-paying manufacturing jobs have been shipped abroad as corporations seek to lower labor costs.

Job losses resulting from TPP, a proposed trade deal between the US and 11 other Pacific Rim countries, could dwarf those caused by NAFTA.

Implementing the Agenda for America will revitalize America by ensuring that the wealth that we all create will be distributed fairly, but it will only happen, said Sanders, if we stand together and educate and organize our friends, family, co-workers, and the millions who have been harmed by the bad decisions made on behalf of special interests rather than for the public good.

If we succeed then we can hold politicians accountable, said Sanders. “If they don’t vote for jobs, then they’ll lose their jobs. If they don’t vote for health care, then they’ll lose their health care.”

Union blames understaffing for VA problems

The American Federation of Government Employees blamed understaffing for the long waits for medical care at Veterans Administration hospitals and urged Congress to act quickly on a recently introduced bill that will fund the hiring of more frontline staff.

“The prevalence of long wait lists are a symptom of the vast understaffing of VA medical facilities,” said David Cox, president of AFGE. “In order to reduce wait times and improve access to VA care that veterans earned through service to our country, we must fix the number one cause of this crisis: understaffing. There is no solving the wait list issue without first solving the staffing issue.”

USA Today reports that more than 57,000 veterans in need of medical care have had to wait more than 90 days to see a doctor. An additional 64,000 veterans who sought care over the last ten years at VA facilities never got to see a doctor.

According to AFGE, since 2009 2 million veterans have entered the VA health system but over the same period of time staffing has increased only 9 percent.

The VA’s inability to keep up with its rapidly rising caseload is due to Congress’ failure to properly fund the services that the VA provides.

To address this problem, Sen. Bernie Sanders and Sen. John McCain have crafted a bill that increases VA funding by $500 million. The funding would be used to hire more doctors and nurses.

“The measure provides for the hiring of new medical personnel in an expedited manner at hospitals and clinics that lack enough doctors, nurses and other medical staff to provide quality care in a timely manner and ensures dedicated funding is available to hire health care professionals,” said Sanders.

The bill will also allow the VA to lease 26 new medical facilities that would expand access to care and give veterans living more than 40 miles from a VA hospital or clinic to use private clinics instead of the VA.

Sanders said that the bill whose title is the Veterans Access to Care Through Choice, Accountability, and Transparency Act of 2014 is not perfect but it is a good first step toward improving veterans health care.

“While this is not the bill that I would have written, we have taken a significant step forward with this agreement,” said Sanders.

One problems with the bill is that it expands the outsourcing of health care services.

“As many Veterans Service Organizations have expressed, such a move could jeopardize the quality of patient care since veterans will be left largely on their own to navigate care between providers lacking specialized knowledge of this population, without the critical care coordination for their complex medical needs that only the VA can provide,” said Cox.

Cox said that outsourcing should be used only as a last resort and pointed to the great strides that the VA has made in expanding access in rural areas through smart investments in telehealth and mobile clinics.

“We need to double-down on these proven systems and deliver to our veterans the quality, specialized care they earned through their service to our nation,” he said.

Cox also said that while it’s good that the bill allows for the hiring of more doctors and nurses, it should have increased funding for more support staff and more clinic space.

“The proposed $500 million to hire new doctors and nurses is critical to getting veterans in the door and provided with quality care,” said Cox. “However, we cannot forget that our medical teams need the proper infrastructure to ensure quality care, patient privacy and clinic productivity. Therefore, as VA increases the number of front-line providers at its facilities, it also needs to provide them with enough support staff and clinic space to get the job done.”

Sanders is hopeful that the Senate will take action on the compromise soon, but there may be a problem with its passage in the House.

The House recently passed its version of the VA bill, but it doesn’t included the $500 million for hiring new staff that is the key feature of the Senate bill.