Jul 16, 2012
New rules quietly approved by Congress and quietly signed into law by Obama will allow corporations to reduce the contributions they are supposed to make to fund their workers’ pensions.
Four of every five private pension plans are already underfunded. The average plan has only about 80% of the money it needs to cover its current pension obligations. Yet the changes just made in the pension rules will put pension plans more at risk. This year, for example, companies will have to contribute only 55 billion dollars of the 80 billion required under the old rules.
Even under the old rules, many companies weren’t making required payments. But this change in the rules, instead of reducing this problem, guarantees that even more of the plans will end up going bankrupt, leaving retired workers out in the cold.
It may be an election year, with the two parties rabidly attacking each other – but this doesn’t stop them from working together to do the capitalists’ bidding.