WATCH: Foxx Opposes Bailout for Failed Union Pensions
Calls for Bipartisan Solution
WASHINGTON | July 24, 2019
|During today’s debate of H.R. 397, a risky, fiscally irresponsible taxpayer bailout for failed union-led pensions, Rep. Virginia Foxx (R-NC), Republican Leader of the Education and Labor Committee, delivered the following remarks:
|"My colleague on the other side of the aisle said that we have a house on fire, and we must do something about it. What this bill does is it gives more gasoline to the arsonist who started the fire.
"Madam Speaker, I rise in opposition to H.R. 397—a risky, fiscally irresponsible, politically motivated scheme that will negatively impact hardworking Americans and retirees.
"Union multiemployer pension plans are currently underfunded by $638 billion and the Pension Benefit Guarantee Corporation (PBGC), which insures these pensions, has a $54 billion deficit. In other words, workers and retirees won’t see the benefits they’ve been promised because of union and employer negligence.
"This problem requires a serious, bipartisan response.That is why, historically, members on both sides of the aisle have worked together on this issue. But last month, when the Education and Labor Committee marked up H.R. 397, Committee Republicans were shut out of the debate and denied the opportunity to offer even a single amendment—a highly unfortunate and inappropriate decision.
"For the first time ever, taxpayers will prop up failing, mismanaged union-run pension plans. These plans, all 160 of them, can apply for a government loan. There is no limit to the loan amount and, remarkably, the loans would be completely forgiven if they are unable to be repaid after 29 years. The Chairman of the Education and Labor Committee said, “If you can’t pay it back, you can’t pay it back.” So, by the Chairman’s own admission we are giving failed union pensions a blank check. WHAT A DEAL.
"All the while, H.R. 397 allows plans to continue to promise new benefits, allowing their liabilities to grow.
"While I strongly oppose what H.R. 397 intends to do, I am equally appalled by what the bill fails to do.
"This legislation fails to include any reforms that would ensure responsible funding of future benefit promises or prevent a similar situation from recurring.
"The bill also fails to address the chronic underfunding that plagues the entire union multiemployer system and passively accepts that plan trustees and actuaries may continue to underestimate pension promises—to the detriment of workers and retirees.
"In fact, under H.R. 397, the situation could become far worse.
"The nonpartisan Congressional Budget Office (CBO) now estimates that H.R. 397 could increase the federal budget deficit by more than $48 billion. But that estimate is based on last minute bogus Democrat pay-fors and covers only the bill’s first 10 years. If we look at the 30-year scheme created by the bill, we’ll find a price tag of hundreds of billions of dollars. And remember, it’s American taxpayers who are on the hook.
"Madam Speaker, Congress was set up to be in this position years ago because Democrats and unions and employers knew that Members and the public would feel sorry for the union members who were not taken care of by those they trusted to take care of them. Every Member here should feel angry about being put in this position. H.R. 397 is a fiscally irresponsible and careless approach that will cause far more harm than good. I reserve the balance of my time."