Column: Retirement Security for America's Workers

Retirement Security for America's Workers

Congressman Ander Crenshaw represents Florida's Fourth District, which includes Jacksonville and the surrounding area. He is a member of the House Appropriations and Budget committees.

With increased frequency, we're hearing disturbing news about the retirement security of America's workers. Workers, retirees, employers, and lawmakers are all asking the same question: How do we ensure that all Americans have the opportunity for a safe and secure retirement?

President Bush and Congressional Republicans recognize the problem and have proposed swift action, not only on the Social Security front, but also to make sure the pension promises made to thousands of American workers are honored. Over the past several years, companies in various industries have terminated their pension plans as their businesses either failed or encountered unfriendly markets.

Most recently, pension problems in the airline industry have captivated the attention of both Congress and the media with the most egregious example coming from United Airlines where the carrier is dumping $9.8 billion in unfunded pension obligations onto the Pension Benefit Guaranty Corporation (PBGC) which will mean reduced benefits for many United workers and retirees. The government now must take on $6.6 billion in United pension obligations.

This example shows our nation's private pension system is in dire straits. Outdated pension rules have brought a crisis to traditional employee pension plans, which are known as defined benefit plans because they promise workers a specific monthly benefit when they retire.

It's clear that today?s cumbersome pension rules are undermining the retirement security of millions of Americans. Now workers and retirees at United must rely on the federal PBGC to step in and pay those benefits, though often at rates far less than originally promised. Unfortunately, the PBGC now has a $23 billion deficit, and taxpayer intervention could be necessary in the future to shore up the agency if its financial condition continues to worsen.

The news doesn?t get better: The PBGC said last week its deficit could balloon to $71 billion in 10 years. It's not just the situation at United that begs attention be paid to pension reform. Delta, which has a significant presence in Florida, along with other legacy carriers such as American, Continental and Northwest have an estimated underfunding of $22 billion in their pension plans.

When worker pension plans are terminated as a result of outdated laws and the financial burden is placed on the federal government, workers and taxpayers both stand to lose. Today's pension rules promote uncertainty and encourage employers to freeze or terminate their worker retirement plans.

Let me give you just a few examples.

-Outdated rules limit employers' ability to better fund pension plans during healthy economic times.
-Outdated rules allow employers to skip pension contributions even if their plans are severely underfunded.
-Outdated rules allow employers and union leaders to negotiate benefit increases when pension plans are severely underfunded.
-Outdated rules often keep workers in the dark about the most accurate status of their pension plan until it is too late, undermining accountability.

All of these problems were present at United Airlines and they are now emerging at other major airlines. Without comprehensive reform to fix outdated federal pension laws, more companies will default on their plans or stop providing pension benefits to their workers altogether.

These problems hit home because there are 34 million U.S. workers receiving private, defined benefit plans, and many now call Florida and the Fourth District home. This problem demands a real solution, not a stop-gap measure that saddles taxpayers with an unwanted burden and workers with broken promises.

House Republicans want to ensure that traditional pension plans remain viable for employers who want to offer this option to their workers, and for workers who rely on them for their retirement security. We expect to unveil comprehensive pension reform legislation in the coming weeks to fix the problem. Fixing outdated pension laws will help preserve traditional pension plans for employers and workers and put the PBGC on better financial footing, protecting taxpayers from a potential bailout.

In the 21st Century, the workers of America, Florida and the Fourth District deserve a healthy retirement security system that offers them an array of choices to secure their retirement future. Reforming our retirement security system is a top priority in this Congress, and we are moving forward to fix the pension system in a way that makes workers the top priority.

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