WASHINGTON – President Joe Biden on Thursday will join labor leaders to announce a federal bailout for a pension fund largely benefiting Teamster workers and retirees.
The $36 billion for the Central States Pension Fund will prevent benefits from being cut more than in half for more than 350,000 truck drivers, warehouse workers, construction workers and others, according to the White House.
- The bailout was made possible by the American Rescue Plan Act, the $1.9 trillion package passed last year in response to the pandemic.
- Financially struggling multiemployer pension plans can apply to the Pension Benefit Guaranty Corporation for assistance.
- Before the act passed, more than 200 pension plans were on pace to become insolvent in the near term, according to the White House. Now, those plans are projected to remain insolvent through at least 2051.
- The $36 billion for the Central Pension Fund is the biggest boost from the program, and the largest ever federal financial assistance for troubled pension funds, according to the White House.
What’s about to happen
Teamster workers and retirees will join Biden and Labor Secretary Marty Walsh at a White House event announcing the assistance. Biden has said he’s goal is to be “the most pro-union president” in U.S. history. He held the first public event of his presidential campaign at a Teamsters hall in Pittsburgh in 2019.
Critics, like George Mason University’s Charles Blahous, say the bailouts encourage “more of the irresponsible behavior that got pensions into trouble in the first place.”
Who is being helped?
Most states have workers or retires expected to benefit. The states with the most beneficiaries are:
- Michigan: 40,300
- Ohio: 39,900
- Missouri: 27,800
- Illinois: 25,000
- Texas: 22,500
- Wisconsin: 21,900
- Indiana: 19,600
- Minnesota: 19,300
- Florida: 18,700
- Tennessee: 14,200
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