Here Come A Lot Of Angry Teamsters: One Of America's Largest Pension Funds Demands A Taxpayer Bailout

Tyler Durden's picture

Over the past few months, we have covered the unfolding saga (here and here) of the Central States Pension Fund, which handles retirement benefits for current and former Teamster union truck drivers across various states including Texas, Michigan, Wisconsin, Missouri, New York, and Minnesota, and is one of the largest pension funds in the nation, all the way through Kenneth Feinberg's rejection of the proposal to cut benefits on behalf of the Treasury.

When the proposal was rejected, we said that the final resolution will be in the form of an inevitable taxpayer-funded bailout

If the Treasury won't allow any pension cuts, and the government created safety net won't be there to keep the benefits flowing, how will the cash continue to flow to members? With the precedent now set by the Treasury that no cuts will be allowed, the answer will likely come in the form of a massive bailout.

As it turns out, that is precisely what fund director Thomas Nyhan believes as well. Nyhan said the rejection means the CSPF likely won't be able to offer another proposed fix without getting funding from Congress, either directly or through the Pension Benefit Guaranty Corp.

However with the PBGC also on its way to insolvency, and unable to shoulder the additional burden in world of zero and negative rates, that leaves us with... drum roll please... the US taxpayers, aka Congress, footing the bill.

"There are only two solutions. Either the plan receives more money or has to have fewer benefits. I'm hopeful that come probably 2017, we can actually all get to work on something that can provide a solution. If there is no legislation at any time, we're going to end up going to insolvency." Nyhan said. 

The full-court press is now on, as now everyone involved is calling on congress to step in. Visitors to CSPF's website this morning were greeed with a banner directing to a rescue plan website.

Before you could enter the rescue site a pop-up message is shown, simply saying that since congress effectively shut down the proposal, they can now stand up and pass legislation to bail the fund out.

"Central States strongly urges these members to act now to pass legislation that protects the pension benefits of the over 400,000 participants of Central States Pension Fund"

 

With the Treasury denying the possibility of pension cuts, the ball is now in Congress' court to initiate a bailout.

When it does, because it will, the flood gates will be open for the rest of the insolvent funds to come knocking with their hands out, and we can formally welcome the arrival of helicopter money - whether Yellen wants it or not - in the United States.

 

What follows is Tom Nyhan testifying before congress back in 2013, laying it out in very plain terms that without funding, or significant benefit cuts, the game is over.

"Unless the fund substantially reduces its liabilities, or receives a large influx of assets, it's projected become insolvent within ten or fifteen years, and at this point our options are very limited."

 

 

Nobody listened, and now - in this bold new age of pension fund crushing zero and negative interest rates - it is game over.

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FreeShitter's picture
  "Now they’re coming for your Social Security money. They want your retirement money. They want it back so they can give it to their criminal friends on Wall Street, and you know something? They’ll get it. They’ll get it all from you sooner or later cause they own this fuckin place" -GC
Billy the Poet's picture

Teamsters will have no truck with pension cuts.

ebworthen's picture

Why should truck drivers, who actually worked for a living, not get bailed out like the lazy worthless turds of Wall Street?

What!?!?  There's $11 Trillion for Bankster offal but not for real people?  Come the fuck on.

RyeWhiskey's picture

ZH taken over by paid banker shills downvoting reason and upvoting scum. Go teamsters.

nuubee's picture

How about no bailouts for anyone. Ever given that a seconds thought?

ebworthen's picture

Sure, but we're about 103 years past that, not to mention the S&L bailouts, the .com bailouts, and the aforementioned Jizztastic 2008-2009 bailouts of AIG, GM, Citibank, Faniie/Freddie, and every trading house and bank that ever breathed a molecule of air labeled "Wall Street" - just as long as they didn't drive a truck, punch a clock, or live on Main Street.

maskone909's picture

Sorry we only bail out large banks and trans racial transvestites who have nowhere to take a shit.

macholatte's picture

Way to go!
Y’all took the bait, Hook, Line and Sinker!

Wake the Fuck Up!!
This Teamsters Bailout is Progressive sheeple bribery.
It’s classical vote buying from a union.
Will the union idiots actually get their promised bail out... fuck no! But that won’t stop them from morphing into union lemmings and jumping off the cliff of lying politicians and union bosses... again!

zeropain's picture

If you got took by false promisses then you need to play the price. Thats how nature works. You try to take shortcuts like obama and clinton then then america pays the price. Not in bail outs but in haircuts. Cuz in the end as trump keeps saying. Discounts are coming and if you have cash when others dont. Then you are in a winning possition.

Bumpo's picture

Pensions are derived from the stock market. Plenty lost their nest eggs by way of their 401k and will never get bailed out. Sociialists expect the rest of us to cover their bad bets, while the average joe has no choice but to take their lumps in the Market. There are no sure things. Grow the Fuck Up. 

Kissy Ass's picture

We need more Congressional Vegetables! FUCK this FEDERAL government that is NOT representative of the people!

wise_owl_says...'s picture

any union clown (multitudes) that has been banking on their pension is delusional. they get what they deserve. let them eat cake. i worked for 30 years and contributed against my will to a pension fund -went to maritime academy, to find out my future career in shipping was monopolized by unions-. i knew it was a scam then and know its a scam now (listened to all old timers bitch and complain -they got their $ and are probably dead now- back when i was a newbie deck officer). been trying to edumacate my friends and family for all these years and to no avail. i hunkered down and hedged with land, gold and silver instead of fancy vacations, partying, and buying bs (want's, not needs). i am going to lose my pension too. i feel a little bit sorry for myself and say se la vie. i don't feel one lick of pitty for rest of my irresponsible mates. i hope that there is no bailout and whole thing implodes. for sake of our children. they do not need to be burdened with more fiat paper ponzi scheme crap! uptopia and nervana you have all been so hopelessly searching for is tangible gold and silver and truely caring for your posterities future! lets put immoral progressive libertard mentality on hold and get back to moral basics. i am not looneytoon EML, nor am i phsyco MDB -even if it is all /sarc-! 

PT's picture

Ain't the US the land of Litigation?  "We can't pay becoz some scum deliberately manipulated interest rates to Zero Percent.  Plus the rest of the shenanigans."  Lawsuit.  Where's the lawsuit?

0b1knob's picture

Cuts are just delayed till after the election.

One of many welcoming gifts from Barry to Trump or Hillary.   Other gifts include a recession, nuclear test by Iran, bankruptcy of Obamacare and WWIII.

WSMassiv's picture

bbbbuut, buuuuut.... will they be in that order?!

DC Exile's picture

I'm a union member (SAG-AFTRA). The pension fund I'm forced to contribute to as part of my wage contract with producers (even as they play games with vesting etc.) has been beset by scandal. It's a multi-biillion dollar fund supporting a high-proflle industry and workers.

The managers have been accused and convicted of embezzling millions, not to mention the shady deals with the banks etc. No more big headline in LA s as apparently the gov and union have reached some backroom deal. Always funny how these big scandals suddenky disappear from sight, no follow-up. The whole forced merger of SAG and Aftra fucked over a lot of people - espc in the pension. In fact , that's prob why they forced the merger because SAG pension was woefully undefunded and corrupt. Meanwhile the average and below average SAG member gets shafted. The corruption is systemic at every level in the USA. 

 

 

 

 

 

 

 

OceanX's picture

How many of y'all that rail against Socialism, live west of the 100 meridian?

Do you know where your water comes from and how it was funded?

http://www.amazon.com/Cadillac-Desert-American-Disappearing-Revised/dp/0...

 

wise_owl_says...'s picture

since you are so aware of these occurances, hopfully you stayed conservative and responsible. turned that paper ponzi fiat crap into tangilble assets and planned for future of your children.

GunnerySgtHartman's picture

And carmakers whose unions have political connections to the White House (I'm lookin' at you, UAW)!

zeropain's picture

Pensions would be fine if interest rate was 7%

0b1knob's picture

ZIRP is gradually bankrupting every pension fund and insurance company in America.

RopeADope's picture

Well that is entirely the point of preventing the destruction of fictitious capital. To allow it time to loot the real capital of a nation.

OceanX's picture

"Pensions would be fine if interest rate was 7%"

Better but, I don't think they would be fine due to the shift in demographics z.b.  fewer leaving the work force than entering ...not to mention reduced earnings thus, reduced contribions ...

 

RyeWhiskey's picture

We bailed out scum of earth - why not people who were robbed by criminal oligarchy?

Billy the Poet's picture

Feel free. I'm sure they'll take your check.

WSMassiv's picture

Actually just write an IOU, that is all a FRN is anyway?  A promissory note.

D Nyle's picture

Is this one of unions who spent 400 million to stop Scott Walker, and billions to stop other conservatives into office of all levels and who knows how much to put Obama in office and now supporting Hillary. Thank you for fucking the country over, so fuck you.

TonyRUs's picture

WE didn't bail out anyone. I was robbed at gun point.

philipat's picture

Investment returns is only half of the problem, the other half being under-funding by the employers. Why TF should the Taxpayer make up the difference, make the employers who under-funded the plan be responsible to bail it out.

If (And probably when) it is bailed out, don't be surprised if the bail out comes along with the next leg of the push to grab all pension fund assets under Giovernment control (UST's). Because it's safe and good for you. Of course.

COSMOS's picture

Ehh, but same congress allowed these plans to be underfunded.  Listen the same song and dance routine happens everytime, the bankers get bailed out to the tunes of trillions and when the working stiff comes a long a little later is the 'hard life for you' routine.  Screw that.  We have seen that all over the place, even Greece and Ukraine etc.

Kindly show me your posts to the same effect when the banker bailouts happened and Ill give you a thumbs up.

philipat's picture

I don't think ANYONE should get bailed out. I believe in capitalism, free markets and creative destruction. But if pension promises are to be made, there is a responsibility on the part of the employer (And contributions from the employee for that matter) to ensure that these pension promises are realistic. But this PF is PRIVATE SECTOR, so why TF should the taxpayer be expected to bail them out? The US is already broke and there are many Billions of similar claims coming from under-funded PUBLIC sector Union PF's, (Teachers, Bureaucrats etc.) which I also don't agree should be bailed out as these are the responsibility of LOCAL Government. If they under-funded them and created unrealistic promises, again, it is the responsibility of local Government (Like in Chicago) to make them whole and Why TF should the Federal Taxpayer pay? And, no, I agree that Wall Street shouldn't have been bailed out either. What made America great is long gone.

And in terms of consistency, my posts over the years have consistently argued against any kind of bailouts, especially for Wall Street because, unlike politicians, I do actually have beliefs and principles.

marbilly's picture

gee, sounds like you got that freeeeee market cornered on consistency, beliefs and principles....show me a free maaaaaaarkeeeeett that exists or has ever existed and ill show you a unicorn....fantasies and delusions of grandeur from that hook nosed fucking hideous disgusting needy cunt seahag ayn rand dont count.

philipat's picture

I said I believe in free markets, which I concede no longer exist. But that is not inconsistent with my thesis. I still BELIEVE in capitalism, free markets and creative destruction, not what we have now which is corruption, Central planning and interventions. I agree that are no more free markets and what we have is crony capitalism. That is unfortunate but it doesn't make me believe that what we have is right...

I'm not entirely sure what is the point you are trying to make. It isn't very clear? perhaps if you stay around at ZH for longer than your existing 18 weeks you might get the hang of intellectual debate?

marbilly's picture

so youre saying that you BELIEVE in something that you admit does not currently exist and has never existed, its a chimera, a tautology, an oxymoron, think about it, really think about what you say when you say free markets, can there truly be such a thing, i mean we have to start from first principles here if were ever going to get anywhere, and again i ask you, give me one current or historical example of a free market, untouched by ...what? anything? sociality, morality, culture, no none of these things dictate how markets work? you fucking simplton.

 

also, what is with the fucking rabid chronological parochial pedantry, what fucking difference does it make how long ive been here. i love how if when someone here says something that makes the sensitive wet their panties, they immediately run to see how long the offender has been a "member" of this site, and then "shame" them or try to by pointing out how short their tenure has been.

 

hey, let me ask you this, you do understand...i mean the possiblity has entered your mind, that, maybe some people have been here from the begining of time but just came back or have multiple accounts or wh o knows what, again wtf difference does it make?

 

is all wisdom and knowledge in the world distilled by tylers and distributed by banzai and unless you read here faithfully and BELIVE (so hard for santa, i know if i just belive hard enough...) then the longer youre here the moar you know? i dont fucking get it...that possiblity, hasnt even entered your mind, otherwise why would you ask such an inane thing?

i mean enough is enough with the oh youve been here 2 weeks? pfft thats rich for someone whose been here 18 weeks and on and on, .. i mean we're going on year seven fucking please tell me youve come up with something more creative than grade school level chronoligical pedantry.

 

 

N2OJoe's picture

One must wonder where you get your idea of Free Markets from? Untouched by anything including sociality, morality, etc WTF?

A Free Market is one left to its own devices free of GOVERNMENT interference and misallocation of capitol. A market where participants are free to trade and contract freely between themselves without the distortions and unilateral violence of the ruling mafia of the region. These things have existed on and off since the dawn of man, and have worked wonderfully for creating prosperity throughout the ages. Now with their death, we being reminded of why it was such an efficient and prosperous system.

Ever wonder why Black Markets are so hard to stamp out? They are Free. Your strawman won't stand here.

marbilly's picture

where do i get this idea of unicorn free markets? oh i dont know you tell me!

you said:

A market where participants are free to trade and contract freely between themselves without the distortions and unilateral violence of the ruling mafia of the region.

 

please tell me where this exists? where has it ever existed? what strawman? 

im asking you to provide an example, any example and if you think black markets arent centrally controlled and are free youre totally delusional and live deep in ayn rand-land.

to say that black markets cant be stamped out because they are free is the pinnacle of failure in understanding logical causation.

how does one follow from the other? you just made that shit up.

black markets cant be stamped out, so they must be 'free'. lmao.

so let me get this straight, according to you, all human exchange is best, if it is conducted under the rubric of black markets? (which you contend are 'free' whatever that means, you put government in caps, then talked about regional mafias)

there is no such thing as a free market, as you libertarians define it, your failure to come to grips with this very seminal point explains why you two contradict yourself in the same sentence and then just move right along, you guys couldnt logically find your way out of a paper bag, and all you leave behind is your very apparent blindside confirmation bias.

 

 

Joenobody12's picture

I need a bailout to pay my tax.

CPL's picture

True, but no one bothered to stop to think about the slippery slope they decided to walk down during the Bush administration.  Now they've gone and pissed off the people that keep it all running.  The fact is if you pay Peter, you better damn well make sure Paul is going to get his cut or Peter ends up wearing cement shoes.

wise_owl_says...'s picture

most thought on this sight is selfish thought with no future planning -other than a corporate, pension and private bailout-, i am beginning to believe that most people say they love, but truely hate their children. they want theirs now and today rather than think of future consequences on their progeny. a s s h o l e s ! ! !

nuubee, that simple statement is profound!

Condition 1SQ's picture

Just another wing of the free shit army.  Fuck 'em in their fat asses.

So your argument is scumbag X got a bailout, so why not scumbag Y?  Give me a fucking break.

BarkingCat's picture

Fuck the both.

Both are criminal enterprises.

LasVegasDave's picture

let me make sure I understand this; you drove a truck 20 years ago, and the pols promised you a big payday when you retired.

 

But they were liars, and now you wanna collect it from me and my family?

 

 

 

 

RyeWhiskey's picture

No, that "privilege" is reserved only for billionaires and the SiliCON valley "tech" brethren. You can't go wrong duping people.

Condition 1SQ's picture

Makes about as much sense as saying because OJ Simpson got away with murder, we might as well made murder legal.  GFY.

COSMOS's picture

LVD,  you went to an IVY league school and lost a shitload of money on Wall St and you want me to make you whole again.  Screw that.

oooBooo's picture

The turds on wallstreet aren't going to be paying for the bailout. Hardworking regular people who aren't teamsters will be.

People who don't have pensions.

Kissy Ass's picture

Which shines light on the real question:

How long will they be hardworking regular people?

roddy6667's picture

Because the Teamsters are organized and managed by organized crime. Every head of the Teamsters Union has been sent to prison. They are at least as corrupt as Wall Street.