Congressman Cleaver Applauds Congressional Hearing on Pension Crisis
Today the U.S. House Committee on Ways and Means held a hearing entitled “Improving Retirement Security For America’s Workers” in an effort to find solutions to the pension crisis facing the Central States Pension Fund (CSPF).
(Washington, D.C.) – Congressman Emanuel Cleaver, II today praised the House Committee on Ways and Means for holding a hearing on the significant multi-employer pension crisis that has roiled hundreds of thousands of workers across the Midwest. The committee will hear testimony from pension experts across the country, including Cindy McDaniel, a Kansas City native and Co-director of the Missouri-Kansas City Committee to Protect Pensions.
“For years now, workers and retirees within the Central States Pension Fund have been dealing with the uncertainty of whether their hard-earned pension will be there in the years to come,” said Congressman Cleaver. “With Democrats taking control of the House, I’m pleased to see one of the first actions taken by the Ways and Means Committee is to hear from pension experts so that we can begin to find solutions and bring stability to these hardworking Americans.”
Over 400,000 people across several states who have vested millions of dollars into their pension funds have been told that their benefits from the CSPF would be drastically cut, some as much as by 60%. People who have saved all of their working lives for this moment of retirement are now finding out that there is not enough to fund their pensions. While most multiemployer plans are adequately funded, according to the Pension Rights Center, 150 to 200 plans are projected to run out of money within 10-20 years. A study from the U.S. Government Accountability Office (GAO) released last summer revealed this is due to several factors, including changes in the economy that have resulted in many plans having more retirees than active workers, company bankruptcies and withdrawals from plans, and investment losses stemming from the 2001 and 2008 stock market downturns.
“What has happened to these dedicated workers and retirees is shameful. They spent years of their lives, some entire careers, working hard and putting money away with the presumption that it will be there for them when the time comes, only to have the rug pulled out from underneath them,” Congressman Cleaver said. “We received the GAO’s report last year addressing how this happened, now we’re hearing from experts on how to deal with the issue, the next step is for Congress to act.”
Since 2015, Congressman Cleaver has been working diligently to help Central States Pension Fund retirees and active workers. In 2016, he held a town hall, in which nearly a thousand people attended to hear U.S. Treasury’s Ken Feinberg speak. He is currently a cosponsor of H.R. 397, the Rehabilitation for Multiemployer Pensions Act, otherwise known as the Butch Lewis Act, which would create a new office within the U.S. Treasury Department called the Pension Rehabilitation Administration (PRA). The PRA would allow pension plans to borrow the money they need to remain solvent and continue providing retirement security for retirees and workers for decades to come.
“If the Central States Pension Fund and other multi-employer pension funds fail, the PBGC will also go under and the effects will create a ruinous tsunami wave across the economy,” said Congressman Cleaver. “The time to pass the Butch Lewis Act is now.”
Emanuel Cleaver, II is the U.S. Representative for Missouri’s Fifth Congressional District, which includes Kansas City, Independence, Lee’s Summit, Raytown, Grandview, Sugar Creek, Blue Springs, Grain Valley, Oak Grove, North Kansas City, Gladstone, Claycomo, and all of Ray, Lafayette, and Saline Counties. For more information, please contact Heather Frierson at 816-842-4545 or Heather.Frierson@mail.house.gov A high-resolution photo of Congressman Cleaver is available here.