February 11, 2021
The American Rescue Plan and Multiemployer Pensions
As part of the American Rescue Plan, House Democrats are considering a bailout of the most underfunded private pension plans — a plan that is a stark departure from the latest negotiations on this issue. AAF’s Director of Fiscal Policy Gordon Gray compares and contrasts previous efforts to reform multiemployer pensions and examines the implications of House Democrats’ latest proposal.
His central points:
- There are about 1,400 multiemployer pension plans that cover about 10 million active and retired workers;
- Collectively, these plans hold about $496 billion in assets but face $1.2 trillion in liabilities for a net liability of $672 billion; and
- Despite years of bipartisan, good-faith negotiation to responsibly address this issue, the House of Representatives is considering legislation to use taxpayer funds to bail out the most underfunded private pension plans, with no reforms to prevent the problem from recurring.