More Bailouts? Ask Senator Durbin.

by Ashley Muchow What’s that?  More bailouts?  That’s right, I said it.  More bailouts.  Illinois’s own, Senator Dick Durbin, has confirmed his support of Senator Robert Casey’s (D-PA) brilliantly frivolous bill, ironically titled the Create Jobs and Save Benefits Act, to bailout approximately $165 billion of underfunded union pension funds. Believe it or not, our state government is...

by Ashley Muchow

What’s that?  More bailouts?  That’s right, I said it.  More bailouts.  Illinois’s own, Senator Dick Durbin, has confirmed his support of Senator Robert Casey’s (D-PA) brilliantly frivolous bill, ironically titled the Create Jobs and Save Benefits Act, to bailout approximately $165 billion of underfunded union pension funds.

Believe it or not, our state government is not the only entity incapable of matching the superfluouspension obligations promised to its employees; private funding for collectively bargained multi-employer pension obligations is not matching its obligations either.  Durbin supports Casey’s plan to push a significant amount of multi-employer pension funding obligations on the Pension Benefit Guaranty Corporation (PBGC), whose funds for such obligations will come from taxpayer pocketbooks.

So let’s get this story straight.

• Unions collectively bargain generous defined-benefit retirement plans for members; negotiating minimal contributions for clear payouts.
• Defined-benefit plans go into multi-employer insurance funds.
• Companies within multi-employer insurance plans struggle and some go out of business, thus withdrawing from the plans.
• Remaining employers are left subsidizing the pensions of some they employ, others to whom they have no relationship.
• Companies struggle to meet the mounting obligations.
• Welcome the likes of Casey and Durbin, pledging to save the day by using taxpayer dollars to meet these obligations.

But really, why would Durbin support such a proposition?  Isn’t the country already facing a budget deficit of magnanimous proportions?  Why place companies’ contractual responsibilities on individuals that in no way prompted the breakdown of such lofty pensions in the first place?  Two things: Votes andFunding.

Some of the strongest backings of the political left and Senator Durbin come from collective bargaining groups and unionized employers.  Failing to save unionized companies from these mounting pension obligations would cause the downfall of deep-pocketed and highly-influencial groups sympathetic to their parties’ cause.

In case there is any doubt as to the influence of such assemblages on politicians like Dick Durbin, let donor dollars lend a legitimatizing appraisal.

According to OpenSecrets.org, in his career, Dick Durbin has received $1,063,606 from building trade, public sector, and transportation unions combined.  

Democrats flaunt bills such as these as a way to create and save jobs.  The union pension bailout bill may save Dick Durbin’s job and the pensions of union workers, but at the expense of taxpayers.   Many of whom were without reprieve when their defined-contribution plans took more than a few hits amidst one of the worst financial crisises in history.

As a wise economic journalist once wrote, “What is seen is the immediate result of an action, such as the jobs created by government spending.  What is not seen is the forgone activity…the jobs that would have been created by private investment had money not been taxed away.”

Let’s think about the results, rather than the votes.  Illinois deserves fiscally responsible representation.