Union pension bailout introduced in Congress
Apparently deaf to the people and under the political thumb of unions, Sen. Bob Casey (D-PA) has introduced legislation that would provide another $165 billion in bailouts for troubled union pension funds. In essence, the bill would use the existing Pension Benefit Guarantee Corp behind union pensions as well at an initial cost of $165 billion. In reality it would be an open ended bailout.
Of course the problem with the union pension funds is the unions have managed them and, even in the good times, managed them poorly:
As FOX Business Network’s Gerri Willis reported Monday, these pensions are in bad shape; as of 2006, well before the market dropped and recession began, only 6% of these funds were doing well.
Of course, bailing out these pension funds is the wrong thing to do for any numbers of reasons. First, of course, is the government has no business taking from taxpayers to prop up entities which have mismanaged their assets. In a free society, the “freedom to fail” is as much a part of that society as the freedom to succeed. We shouldn’t be in the business of trying to prevent bad consequences that result from bad or poor behavior and management (although the precedent has been set with the auto bailouts).
Secondly, this is an internal union problem – not a problem for the taxpayers. Union members should be dealing with management that has so badly managed their retirement assets, not the rest of us. Where was the membership when it became clear, much earlier than now, that this sort of problem existed and was getting worse?
It isn’t clear that this legislation will get anywhere (it shouldn’t), but it speaks to a mindset existent among politicians that is the target of many voters this year. The Casey’s of the Congress are who need to go. And I’d feel the same way if it was a GOP legislator trying to save some corporation from the results of its poor decisions.
The idea of government, via the taxpayers, is there to backstop every downturn resulting from poor private decisions and management is an idea which we need to forever banish from out thinking.
As an aside, President Obama has declared there would be no more bailouts. But this is a union we’re talking about here. Let’s see if he sticks by his guns or whether we ought to give his declaration as much credence as we would if he said he was never going to use a teleprompter again.