"The federal Pension Benefit Guaranty Corp.,
which insures these pensions, says that some 10 percent of
multiemployer plans — covering about 1.5 million people — are in such
financial trouble that they are likely to become insolvent. The PBGC
estimated that its fund insuring multiemployer plans will likely run out
of money in eight to 10 years unless changes are made.
.
Some lawmakers
argued that these distressed plans need the ability to cut retirees’
benefits so pensions can survive longer.
.
AARP
and other consumer advocates argue that these pensions aren’t in
immediate danger of insolvency so there is no need to rush this drastic
measure without considering alternatives,
such as scaling back on optional benefits in a plan or providing the
PBGC with greater funds and the authority to intervene earlier.
Advocates also worry that this move by lawmakers might someday open the
door to similar pension cuts in other plans".
source: http://blog.aarp.org/2014/12/16/those-pension-cuts-and-what-you-need-to-know/ via @aarp
.
So why the cuts--its about stock dividends. When reserves can be cut, that chunk of cash goes into the company's "income" improving "performance" and dividend values.
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