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Reply #132: and if a lot of plans get turned over to the PBGC and the PBGC is underfunded, [View All]

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antigop Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Mar-13-08 11:29 AM
Response to Reply #124
132. and if a lot of plans get turned over to the PBGC and the PBGC is underfunded,
who will bail out the PBGC?

I doubt taxpayers who aren't covered by pension plans will want their tax dollars going to bailout a fund which will not benefit them.

It will pit citizens against one another. At the federal level, people who are in plans covered by the PBGC will lobby for a bailout. They will be pitted against those who don't want their tax dollars going to bail out something that will not benefit them.

At the state level,the citizens will be divided into two camps as well: those who are covered by state pension plans and will want the state to honor its commitment, and those who won't want to pay for a bailout through increased taxes/reduced spending on services.

This happened in our local community recently. One of the city pension funds was extremely underfunded. There were two camps of people: those who felt the city should honor its commitments and pay up, and those who didn't want their tax dollars going for a bailout.

The net of all of this as I see it, will be
1)the division of the country into two camps
2) litigation by those who have a legal right to their benefits because the benefits are protected by law

The implications of this mess are, indeed, overwhelming.

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