Steel Worker retirees get a lesson on pensions, and how to save them

By CARL GREEN
Illinois Correspondent

Pontoon Beach, IL – A United Steelworkers leader is calling on local retirees from all unions to work in support of a bill before Congress that could save the pension plans they rely on.

Jerome Davison, District 7 Rapid Response Coordinator out of Gary, IN, told SOAR Chapter 7-34-2 at a recent luncheon that House Resolution 397, known as the Butch Lewis Bill, is aimed especially at keeping multi-employer pension funds solvent as pressure mounts against the plans.

“Unless something happens in Congress, the safety net won’t be there,” he told the packed audience at the Neighborhood Social Club hall. “I am not going to profess to you that this is the be all-end all, but it’s a starting point from where we can make that push.

“You know the old saying: ‘If you’re not at the table, you’re on the menu.’ Well, we’ve got to push to get a place at the table.”

The bill would create the Pension Rehabilitation Administration under the U.S. Treasury and permit bond sales to allow long-term, low-interest loans to help pension funds meet their obligations, reducing the risk of default that could wipe out much of the pensions’ value.
“Basically, the whole idea is to prevent cuts,” Davison said. “Our pensions cannot take a cut.”

PBGC FAILING
When pension plans fail, they are taken over by the Pension Benefit Guarantee Corp., a federal agency that provides pension payments but at greatly reduced amount, often half or less of what retirees were expecting. In addition, the PBGC itself could default in a few years as demand continues to outpace its revenues.

“Once it goes to the PBGC, it doesn’t matter what your contract says, your contract is null and void,” Davison said. “Then it becomes the PBGC and their rules.

“It is a few dollars you’re going to get. It’s better than the alternative, which is nothing, but it’s not much.”

When he asked for a show of hands of how many at the luncheon were already receiving PBGC pensions, dozens responded. “You’re living it, you know it, and you get it,” he said.

Steelworker retirees typically are not enrolled in the multi-employer plans, so they are not in as much danger of default. The Teamsters Central State Pension Fund is the most well-known multi-employer pension in great difficulty, but Davison mentioned three others –Pace Industry Union Pension Fund, National Integrated Group Pension Plan and Greater Wisconsin Pension Trust.

“All three of those pensions are projected to be insolvent within 15 years,” he said. “Scary stuff!”

Davison attributed the pension problems in great measure to failed economic and trade policies that left industries less competitive, even though unions have been able to win their court cases on trade issues.

“We have to lose to win,” Davison said. “We never get back fully the number of people we had in the plant, so that means less people are paying into the pension.”

CALL TO ACTION: TELL CONGRESS TO SUPPORT BUTCH LEWIS ACT
Senator Sherrod Brown (D-Ohio) has been leading the push in Congress for the legislation, which has been strongly supported by Democrats but not Republicans.

“The Republicans don’t believe you should have a pension. They think you should be out in the market with a 401K – survival of the fittest,” Davison said. “Instead of taking a pay raise, we accepted a promise of a pension at a later time, with a few dollars offset. Now the day’s coming and they should be paying us, but they tell us there’s nothing there.”

Davison asked the retirees for three actions:

• Make phone calls.
• Write letters.
• Seek face-to-face meetings with members of Congress.

MAKE A CALL
When calling your member of Congress, ask the staff member who answers the phone for a letter explaining the Representative’s position on HR 397 and make a brief statement about how you cannot afford pension cuts. You can call your representative toll-free at (800) 202-5409.

WRITE A LETTER
Letters are best when written by hand, Davison said. “Hand-written letters are gold to an elected official. When you write letters by hand, they know you are concerned. Don’t think your letter doesn’t mean anything,” he said.

One or two paragraphs are enough, he said, and lousy handwriting is not a problem.

FACE-TO-FACE
Jeff Raines, president of the local SOAR Chapter 34-7-2, was already arranging meetings with four House members who represent the St. Louis region – Democrat Lacy Clay in St. Louis, and Republicans John Shimkus, Mike Bost and Rodney Davis in Illinois.

Rains said he and Chapter Vice President Dennis Barker also are collecting letters from members to forward to them.

“Write those letters!” Raines said. “Just tell them you worked 38 years or however many for National Steel, and now your pension is being taken over by the PBGC and you can’t afford for it to be refigured anymore. That’s all you need to do. Sign your address and we’ll make sure it gets there.”

Rains can be reached by phone at 618-452-1130. Letters to be forwarded to your representative can be sent to SOAR at 10 Central Industrial Drive, Suite 4, Granite City, IL 62040.