Have you heard of the Biden administration’s plan to give $90 billion to bail out union pensions? No? Most people haven’t. While it might be normal for the union-supporting Democratic Party and most of the mainstream media to sweep such a boondoggle under the carpet for political expediency, one would think that the GOP— and most especially its potential presidential candidates — would be screaming bloody murder. But they aren’t.
The bailout is buried within the Biden administration’s $1.9 trillion American Rescue Plan Act. Now, the song and dance the administration is performing to justify this is that these union pension plans were adversely hurt by the pandemic. Except, if anyone cares to do a little research, they’ll find that these pension plans were in deep trouble long before the virus reared its ugly head upon our shores.
As Howard Adler and Alex Pollock write in the Wall Street Journal: “The American taxpayer will bear the cost of union plans that were insolvent long before the pandemic. The bailout all but guarantees future insolvency or another bailout and constitutes a massive giveaway to labor unions.”
Just how insolvent were these plans before the pandemic? The Pension Benefit Guaranty Corporation estimated that in 2018, these multi-employer union pension plans were insolvent to the tune of $757 billion. It’s a number that some experts believe to be vastly underestimated.
As the Heritage Foundation reported: “The fact that private union pensions have been allowed to promise $757 billion more in benefits than they set aside to pay is reckless and should be illegal. Millions of people worked decades for what they thought would be a secure pension but was instead a bill of goods that only propped up unions’ power.”
And yet, because few conservative voices have condemned this giveaway, President Biden was in Cleveland two weeks ago literally bragging about using $90 billion from American taxpayers to bail out these self-destructive union pensions.
Such transparent political boasting from the president begs two questions. The first: Since when did $90 billion of taxpayer money become so insignificant that we don’t notice its spending? And second: Why aren’t any of the potential Republican presidential candidates for 2024, such as Donald Trump, Florida Gov. Ron DeSantis, and former South Carolina Gov. Nikki Haley, loudly protesting such a giveaway?
Maybe they, like most politicians and members of the media, need to have $90 billion put in more relevant terms they can better understand. That amount of taxpayer money is more than the yearly revenue of 190 countries.
Maybe Trump, DeSantis, Haley and any other politician or member of the media worried about flushing the yearly revenue of 190 nations into the politicized D.C. swamp might want to consult with Derek Kreifels, the CEO of the State Financial Officers Foundation. In a recent interview with Fox Business, Kreifels said, “The White House is going to allow the same pension fund managers — who have been historically awful at their jobs — the ability to make riskier investments with not only hard-working Americans pensions, but also the nearly $100 billion worth of taxpayer dollars delivered to unions under the guise of COVID relief. In truth, this is a disaster of the Biden administration’s own making, putting millions of Americans’ retirements at risk with terrible economic policies that are reverberating throughout every facet of our lives — from the gas pumps to the grocery stores.”
Maybe focusing on this giveaway will next cause them to speak out about the unfunded state public employee pension liabilities, which are projected to increase to at least $1.3 trillion for fiscal year 2022. Again, to break it down, that is over one thousand billion dollars in unfunded liabilities for gold-plated pensions, benefiting a small — but often political — percentage of the American workforce.
It’s a monetary burden that is crippling the finances of states and cities while negatively impacting their most at-risk citizens. But hey, as long as these giveaways might secure some votes for the Democrats in the next election, what’s the problem?
Douglas MacKinnon, a political and communications consultant, was a writer in the White House for Presidents Ronald Reagan and George H.W. Bush, and former special assistant for policy and communications at the Pentagon during the last three years of the Bush administration.