Marjorie Sener was still in her 20s when she took out a loan for about $5,000 to get some college credits she hoped would eventually add up to a bachelor’s degree. That goal was thwarted when her partner became ill. “The burden of our living expenses fell on me,” said Sener, who lives in the Dallas suburbs. “I devoted all of my resources to keeping our heads above water.” But while Sener never got her degree, that student loan kept growing, fattened by compounding interest. Now, at 74, she owes more than $55,000, or 10 times what she originally borrowed, and has put off any hope of retiring. Sener still works, as a legal secretary, juggling her student loan debt with other expenses, including medical costs from recent cancer treatments.
Do you have a good pension? Do you have any pension at all? Back in 1975, most Americans who worked for established employers could say that they do indeed have a decent pension. Back then, what the experts call “defined-benefit” pension plans set the standard. If you worked for a company with one of these plans, you could look forward to receiving — for every month of your retired life — a pension check based on your salary and years of service. These defined-benefit plans gave employers the responsibility for funding their employee retirements. Employers contributed into retirement funds and used the investment returns these funds generated to keep pension checks flowing. If those returns came up short, employers had to fill the shortfall.
In recent decades, a top management priority has been reducing the cost of retirement benefits. The pandemic and its economic fallout have generated a new round of employer demands for pension freezes, benefit cuts, plan conversions, and two-tier coverage. The Labor Guide to Retirement Plans (Monthly Review Press), a newly published book by Oregon union activist Jim Russell, shows why and how private and public sector workers should be mobilizing against such concessions. This book will be a critical resource for defending retirement security at the bargaining table and in the political arena. The Labor Guide is not only a highly readable account of retirement plan financing and administration, with a handy glossary of layperson explanations of sometimes confusing technical terms.
As the private equity industry launches ads to protect its lucrative tax preferences, we should remember that this industry is the unseen man behind the curtain driving many social ills — from high hospital prices to surprise medical bills to nursing home deaths to media layoffs to a housing crisis that has become a human rights emergency. A *Businessweek* cover put it best: You live in private equity’s world, even if you don’t know it. But a series of new reports remind us that there is another person behind the monocled, mustache-twirling oligarch running the Emerald City’s secret control panel — and that person isn’t a billionaire. It is the faceless pension official in a state capital or city hall who is using workers’ retirement savings to finance the Wall Street takeover of Oz.
Green Bay, WI - For the first time in seven years, thousands of Wisconsin Teamsters don't have to worry about their pensions being cut in half. The American Rescue Plan, which President Joe Biden signed into law on Thursday, included the Butch Lewis Emergency Pension Plan Relief Act of 2021. The act directs the Pension Guaranty Benefit Corp. to allocate billions of dollars to avoid the drastic cuts. The act will shore up the Central States Pension Fund, a multi-employer fund for 1.3 million retired Teamsters, 23,500 of whom live in Wisconsin. About 3,400 members live in the Eighth Congressional District, which includes Green Bay and Appleton. Failure to act would have dealt a huge blow to those retirees who gave up wages to keep their retirement funds, and who have come to depend on payments to survive, said Brad Vaughn, a member of the Wisconsin/Green Bay Committee to Protect Pensions.
Vivian Majors spent her life cleaning houses while her husband, Martin, worked as a carpenter. Their bodies broke down in their 60s. Martin now lives in a nursing home and has Parkinson’s disease. Vivian, now 71, lives on her own and ekes by on a $960 in social security, plus $50 in food stamps. Hardened by years of physically taxing work that left her hovering around the poverty line, Majors, now retired, is girding herself for more years of financial hardship.
Thousands of retired people and supporters took over the streets in several cities in Spain on Saturday to demand “decent” pensions of at least 1,080 Euros a month, and yearly updates according, to the Consumer Price Index (CPI). The protests started in Bilbao, capital of the Basque country, in January as a weekly demonstration and spread to over 200 cities and towns across the Spanish State, supporting other movements along the way. They were organized by the State Coordinator for the Defense of the Public Pension System under the slogans “whoever is ruling, pensions must be defended,” and “Our future: there’s no solution without mobilization!”
By Maurie Backman for USA Today - In a recent GoBankingRates study, 69% of adults admitted to having less than $1,000 in the bank, while 34% said they actually don't have any savings at all. But apparently, this collective lack of savings doesn't get all that much better with age. A study by the National Bureau of Economic Research found not so long ago that almost half of Americans die nearly broke. Of the general population, 46% of retirees die with savings of $10,000 or less. But that number climbs to 57% among retirees who are single. Now when we take other assets, like homes, into account, the picture gets a bit less bleak. Still, 57% of single-adult households and 50% of widowed households had no housing equity to show for when they died. The problem is that dying nearly broke isn't just a matter of denying one's beneficiaries an inheritance. Rather, it points to a frightening degree of financial vulnerability during retirement. If seniors are passing without much in the way of assets, it means that in the years leading up to their death, they're ill equipped to handle a major unexpected expense, such as a significant medical bill. In fact, in that same GoBankingRates survey, only 37% of seniors 65 and older claimed to have $1,000 or more in the bank.
By Glenn Greenwald for the Intercept. It’s almost impossible to imagine a presidency imploding more completely and rapidly than the unelected one imposed by elites on the Brazilian population in the wake of Dilma’s impeachment. The disgust validly generated by all of these failures finally exploded this week. A nationwide strike, and tumultuous protests in numerous cities, today has paralyzed much of the country, shutting roads, airports and schools. It is the largest strike to hit Brazil in at least two decades. The protests were largely peaceful, but some random violence emerged. The proximate cause of the anger is a set of “reforms” that the Temer government is ushering in that will limit the rights of workers, raise their retirement age by several years, and cut various pension and social security benefits. These austerity measures are being imposed at a time of great suffering, with the unemployment rate rising dramatically and social improvements of the last decade, which raised millions of people out of poverty, unravelling. As the New York Times put it today: “The strike revealed deep fissures in Brazilian society over Mr. Temer’s government and its policies.”
By Dominic Rushe and Tom Pietrasik for the Guardian. Momentive’s workers are not alone in their grievances. In 2016 dollars, the average hourly wage of a high school educated worker was $18.29 in 1973, according to the Economic Policy Institute. Last year it was $17.25. Ignoring minor bumps and dips, it’s fair to say that a quarter of the US workforce (those with no more than high school education) have seen their wages barely keep up with inflation for more than 40 years – a period that enjoyed decades of spectacular economic growth, particularly for the top 1%. Chatting over a beer after a day on the lines, Benny Patrignani, Dominick’s brother, says he has hope that Trump will bring change. “Both parties are so busy hitting each other, they haven’t been interested in us,” he says. The choice, he said, was: “Do you want to die by drowning or die by fire?”
By Sarah Anderson for IPS - If President-elect Donald Trump succeeds in cutting the top marginal tax rate from 39.6 percent to 33 percent, Fortune 500 CEOs would save $196 million on the income taxes they would owe if they withdrew their tax-deferred funds. Unlike ordinary 401(k) holders, most top CEOs have no limits on annual contributions to their tax-deferred accounts. In 2015 alone, Fortune 500 CEOs saved $92 million on their taxes by putting $238 million more in these accounts than they could have if they were subject to the same rules as other workers.
By Alexandra Bradbury for Labor Notes - Who could have predicted a year ago, as Congress-sanctioned pension cutsgathered momentum, that thousands of retired truckers self-organizing in diners and union halls across Middle America would manage to apply the brakes? “We’ve taken just normal, everyday grandmothers and grandfathers, and we’ve made citizen lobbyists out of them,” said Wes Epperson, a retired member of Teamsters Local 41 in Kansas City, “and it’s been because of necessity.”