Tax Money for Union Pension Bailouts?

The following opinion page article is from the Orange County Register entitled, Private union pensions the next bailout?   

“For years another potential multibillion fiscal catastrophe has been brewing, obscured by higher-profile storms created by taxpayer bailouts of Detroit and Wall Street and the looming crash of underfunded public employee pension plans.

For the first time, taxpayers may become responsible for the nongovernmental pension liabilities of union collective bargaining contracts in construction, trucking and other industries in which workers move from one employer to another. Some estimate that these multiemployer pensions are $165 billion short of committed obligations for paying retirees’ defined benefits.

It’s not a new problem, but it has been under the radar for years as it’s worsened. In 2004, the libertarian Cato Institute’s Richard A. Ippolito warned that underfunded private-sector pension funds increased the likelihood of a taxpayer bailout.

Defined-benefit pension plans arguably suffer more than 401(k)-type funds from stock market losses and the prolonged recession because the amounts they must pay retirees can’t be reduced. Moreover, the federal program to back private pensions, the Pension Benefit Guaranty Corp., has its own $21 billion deficit.

A bill in Washington would put taxpayers on the hook for multiemployer plan obligations backed by the PBGC, which so far has been financed only by insurance premiums, investment income and pension plan assets. How much tax support will be required is in dispute. We fear the total also will be open to negotiation and union pressure.

Sen. Bob Casey, D-Pa., contends that his Create Jobs and Save Benefits Act of 2010 costs no more than $10 billion. Critics say the bill is the nose under the tent, potentially exposing taxpayers to the full $165 billion shortfall, and whatever additional future debts can’t be paid by underfunded private plans. Casey’s bill would establish a “partitioned” fund within the PBGC devoted to deficit-ridden multiemployer plans.

“The proposal would transfer responsibility to the PBGC for paying of the full plan benefits of participants transferred to the partitioned plan, which in many cases would be well above the amount guaranteed by the PBGC under current law,” testified Phyllis C. Borzi, assistant secretary of labor.

Transferring these private, union-negotiated obligations to taxpayers is unwarranted. As with previous federal bailouts, it’s also ripe with the seeds of dire, unintended consequences. We fear that particularly after November’s balloting, a lame-duck Democratic-controlled Congress and a president prone to federal intervention may unwisely approve such a measure to pay back labor unions, which donate tens of millions to their political campaigns”

Comment:  Why go half way if suicided is the game?

Victor Davis Hanson Writes “The Enigma of Our Age”

Hanson’s article is subtitled:  “From Arizona to Ground Zero”

“The recent controversies over the Ground Zero mosque and Arizona’s anti-illegal immigration law are windows into our collective souls. Think of the paradoxes.

 A self-professed ecumenical Islamic organization picks a spot next to the site of the mass murder of 2,700 New Yorkers by radical Islamic terrorists — a deliberately provocative act designed to, at best, bother millions and, at worst, provide the sorts of visuals and optics that will shortly appear in DVDs and on the internet throughout radical Islamic enclaves in the Middle East, as a mosque is juxtaposed to the memorial shell of the World Trade Center. (We know what’s next: “O blessed Holy Warrior Atta, you took down the looming tower of the infidels and raised a mosque in its place!”)

 The president weighs in on a local issue (cf. the Professor Gates/Officer Crowley mess), deliberately misrepresenting it and inflaming passions quite gratuitously by suggesting critics wanted to ban by law the mosque rather than pressure the organizers to reconsider. Surely Barack Obama knew the issue was one of decorum and taste and reverence, and surely Barack Obama tried to obfuscate all that by demonizing opponents as awful sorts of un-Americans without tolerance of religious diversity (revisit the clingers riff of 2008).

Then there was the question of reciprocity. To build a church in Mecca [1] would mean death on the spot (to visit Mecca as a Christian or in general as a non-Muslim is a suicidal act). Why would not reform-minded Muslims seek first to change the hearts and minds of bigots in the Middle East, before testing the patience of liberal-thinking Americans?

And, of course, there is the old issue of “compared to what”? Americans object to the decorum of building a Middle East-financed, 13-story mosque next to Ground Zero, but, of course, grant the legal right of someone to be so boorish should they choose. But why would not the world turn its attention to the Chinese and their rather illiberal treatment of Muslims, or the Russian scorched-earth strategy in Chechnya — or the endemic intolerance of Muslims themselves?

In Arizona’s case, review the now tired paradoxes. Mexico, with an awful record on illegal immigration to its south, lectures Americans about its ethical shortfalls up north. Millions of illegal aliens are angry that the state wishes to enforce federal statutes, but not quite to the extent of being too angry to quit residing illegally in the United States. The federal government sues a state for enforcing federal law, and ignores cities that subvert it. The president weighs in again, unnecessarily so, and once more misrepresents the issue, by suggesting the innocent on their way to buy ice cream will be profiled and deported.

 What are the lessons? Privately, the hardest leftist knows that millions of Mexican nationals or Muslims want to enter the U.S. But then why that is so is never voiced. Does anyone simply tell the truth? The combination of private property, free markets, transparency, personal freedom, limited government, meritocracy, and a singular constitution makes life here good. And rather than appreciate such an exceptional system, much less defend the idea of it, we beat each other up that we are mere mortals, not gods, and, my God, we can find a supposed misdemeanor here amid rampant felonies abroad. This is the most tolerant society in the world, the most multiracial and richest in religious diversity — and the most critical of its exceptional tolerance and the most lax in pointing out the intolerance of the least diverse and liberal. It is market capitalism, unfettered meritocracy, and individual initiative within a free society that create the wealth for Al Gore to live in Montecito (indeed to create a Montecito in the first place), or for Michelle to jet to Marbella, or for John Kerry to buy a $7 million yacht.

We know that, but our failure to occasionally express such a truth, coupled with a constant race/class/gender critique of American society, results in an insidious demoralization among the educated and bewilderment among the half- and uneducated.

In short, the great enigma of our postmodern age is how American society grew so wealthy and free to create so many residents that became so angry at the conditions that have made them so privileged — and how so many millions abroad fled the intolerance and poverty of their home country, and yet on arrival almost magically romanticize the very conditions in the abstract that they would never live under again in the concrete.

A final thought: given what we know of collectivism now and in the past, government in places like Mexico or Syria, multiculturalism in nations as diverse as the Balkans and central Africa, and the role of religion in most locales of the Middle East, how exactly could critics of the U.S. gain the security to protest, the capital to travel, and the freedom to criticize should the system that they find so lacking erode or even disappear?

The income for a Rangel or Geithner to hide on their taxes, the leisure to visit Martha’s Vineyard, and the tolerance to break a federal immigration law or offend the majority — all that had to come from somewhere.

From time to time, we should pay homage to that somewhere — and those in the graveyards who created it.”

Comment:  The ENIGMA covers the reality that for the first time in American history Marxism is being sold to the American public.  Never openly and in debate……it never is.  It is nurtured and morphed at universities and has been indoctrinating the college scene for more than a generation.  At last, with the election of dogmatist, Barack Obama, the flavor of government control of society is being tested through bribe and stealth as demonstrated in Obama’s victory in the government takeover of the American health industry.

Leftists are devoted in their religion, Marxism.  Its devotees  have not given up the fight to rule here.  Why should they since they already control the American education scene.