Congressional Record, Volume 151 Issue 161 (Thursday, December 15, 2005)

[Congressional Record Volume 151, Number 161 (Thursday, December 15, 2005)]
[House]
[Pages H11660-H11670]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

PROVIDING FOR CONSIDERATION OF H.R. 2830, PENSION PROTECTION ACT OF
2005

Mr. HASTINGS of Washington. Mr. Speaker, by direction of the
Committee on Rules, I call up House Resolution 602 and ask for its
immediate consideration.
The Clerk read the resolution, as follows:

H. Res. 602

Resolved, That upon the adoption of this resolution it
shall be in order without intervention of any point of order
to consider in the House the bill (H.R. 2830) to amend the
Employee Retirement Income Security Act of 1974 and the
Internal Revenue Code of 1986 to reform the pension funding
rules, and for other purposes. The bill shall be considered
as read. In lieu of the amendments recommended by the
Committees on Education and the Workforce and Ways and Means
now printed in the bill, the amendment in the nature of a
substitute printed in part A of the report of the Committee
on Rules accompanying this resolution shall be considered as
adopted. All points of order against the bill, as amended,
are waived. The previous question shall be considered as
ordered on the bill, as amended, to final passage without
intervening motion except: (1) 90 minutes of debate equally
divided among and controlled by the chairman and ranking
minority member of the Committee on Education and the
Workforce and the chairman and ranking minority member of the
Committee on Ways and Means; and (2) one motion to recommit
with or without instructions.
Sec. 2. During consideration of H.R. 2830 pursuant to this
resolution, notwithstanding the operation of the previous
question, the Chair may postpone further consideration of the
bill to a time designated by the Speaker.

The SPEAKER pro tempore (Mrs. Miller of Michigan). The gentleman from
Washington (Mr. Hastings) is recognized for 1 hour.
Mr. HASTINGS of Washington. Madam Speaker, for the purpose of debate
only, I yield the customary 30 minutes to the gentleman from
Massachusetts (Mr. McGovern), pending

[[Page H11661]]

which I yield myself such time as I may consume. During consideration
of this resolution, all time yielded is for the purpose of debate only.
(Mr. HASTINGS of Washington asked and was given permission to revise
and extend his remarks.)
Mr. HASTINGS of Washington. Madam Speaker, House Resolution 602 is a
closed rule providing for 90 minutes of debate in the House on H.R.
2830, the Pension Protection Act, as amended, to be equally divided and
controlled by the chairman and ranking minority member of the Committee
on Education and the Workforce and the chairman and ranking minority
member of the Committee on Ways and Means. The rules waives all points
of order against consideration of the bill. In lieu of the amendments
recommended by the Committees on Education and the Workforce and Ways
and Means now printed in the bill, the amendment in the nature of a
substitute printed in part A of the report of the Committee on Rules
accompanying the resolution shall be considered as adopted. The rule
waives all points of order against the bill, as amended, and provides
one motion to recommit, with or without instructions. Finally, it
provides that notwithstanding the operation of the previous question,
the Chair may postpone further consideration of the bill to a time
designated by the Speaker.
Madam Speaker, the recent financial troubles and pension terminations
at several large companies underscore the need for fundamental pension
reform. H.R. 2830, the Pension Protection Act, will ensure that
millions of hardworking Americans who rely on single and multi-employer
pension benefits can continue to count on them. It is vital that we
modernize current pension laws by strengthening workers' retirement
security and reducing the prospect of a future multi-billion-dollar
taxpayer bailout. The Pension Protection Act will fix outdated pension
rules and help workers by giving employers incentives to properly and
adequately fund their pension plans, and by enhancing transparency and
disclosures about the status of their pension plans. In recent years,
we have seen participants mistakenly believe that their pension plans
were well funded, only to be surprised when their plan was abruptly
terminated. This bill is intended to end that practice.
The Pension Protection Act encourages workers to increase their
personal savings by permanently extending several provisions to enhance
pension participation and retirement savings that are currently set to
expire in the year 2010. Among the provisions to be permanently
extended are: increasing annual contribution limits for individual
retirement accounts and qualified pension plans, allowing additional
catchup contributions to individuals age 50 and older, and establishing
incentives for small employers to offer pension plans. The bill also
encourages lower income workers and families to plan and save for their
retirement by permanently extending a Federal ``match'' in the form of
an income tax credit for the first $2,000 of annual contributions to an
individual retirement account or qualified pension plan.

{time} 1030

Madam Speaker, the Pension Protection Act implements a comprehensive
and bipartisan investment advice proposal that allows employers to
provide workers access to qualified investment advisers who can inform
them of the need to diversify and help them choose appropriate
investments while including safeguards to ensure that the advice is
solely in their best interest. This changes outdated Federal rules
which actually discourage employers from providing workers with access
to professional advice.
One provision, Madam Speaker, I am especially pleased was included in
this bill, was to allow employees who participate in tax-preferred
flexible spending accounts to carry forward up to $500 of their unused
balances each year. This provides flexibility to employees that
otherwise must use all of their balances each year or lose it to their
employers.
Madam Speaker, without a comprehensive fix to our outdated pension
plans more companies will default on their worker pension plans and
more will stop providing defined benefit pension plans to their workers
entirely. Now is the time for Congress to act on this important piece
of legislation.
The Rules Committee approved this House Resolution 602 by a voice
vote. Accordingly, I encourage my colleagues to support the rule and
the underlying bill, the Pension Protection Act.
Madam Speaker, I reserve the balance of my time.
Mr. McGOVERN. Madam Speaker, I yield 1\1/2\ minutes to my colleague
on the Rules Committee, the gentleman from Florida (Mr. Hastings).
Mr. HASTINGS of Florida. Madam Speaker, Mr. McGovern, my
distinguished friend from Massachusetts; my good friend, the
distinguished gentleman from the State of Washington; and I were in 6
hours of hearings yesterday on something called border security, anti-
terrorism, and illegal immigration, and we came here this morning at 7
a.m., ostensibly to pass out the rules necessary to hear that bill.
Until 15 minutes ago, I was on this floor of this House waiting to hear
that bill.
I ask my colleagues in the majority: Where is this terribly onerous,
atrocious bill? Why do you not pull it? The reason that we are not
taking it first, rather than what we are now patching up as pensions,
and caution to America, what we are about to see is protection of CEOs
with their golden parachutes while workers and their pensions are
getting a brass shaft.
But that is not my point I want to make. What I want to say is we are
getting ready to create fear and confusion, and there is substantial
confusion on the majority side in light of the fact that they are
shifting from this bill to that bill and not dealing with the things we
need to do and get on out of here.
We do not need to do this immigration and border security bill, and I
hope that your confusion led you to the same conclusion and that you
will pull that sucker.
Mr. McGOVERN. Well, let me thank my colleague from Florida for that
eloquent and accurate statement and assessment of where we are here.
And, Madam Speaker, let me thank my friend from Washington (Mr.
Hastings) for yielding me the customary 30 minutes, and I yield myself
7 minutes.
(Mr. McGOVERN asked and was given permission to revise and extend his
remarks.)
Mr. McGOVERN. Madam Speaker, millions of Americans who work in the
private sector are relying on having an employer-sponsored pension plan
when they retire. An important part of the American dream is to have a
nest egg that people can tap into during their golden years so that
they are not forced to literally work until they die. American workers
have fought for and earned the right to pay into a pension system that
will provide an income once they retire. Unfortunately, there are
serious problems with America's private pension system.
Madam Speaker, pension security is an important issue, one indeed
which should be addressed by this Congress, but pension security must
be addressed in the right way and it deserves to be addressed in a
democratic way.
Bankruptcies in the airlines, steel, and the auto parts industries,
for example, are straining the abilities of the Pension Benefit
Guaranty Corporation, or the PBGC, to guarantee the private pensions of
workers in these industries. The PBGC was created as an insurance
system for America's private pension plans. It exists to make sure that
America's workers will receive a pension when they retire, even if the
company they work for cannot pay that pension.
Now, while there are real problems in some industries, like the steel
industry, there are also serious cases of pension dumping, where a
corporation claims it cannot fulfill its obligations and dumps its
pension onto the PBGC. The net effect is a real strain on the PBGC and
ultimately a crisis in the pension system.
The PBGC is an insurance policy for America's workers. It is a safety
net should a company not be able to pay its pension obligations. But it
is not supposed to be a dumping ground for corporations who want to
boost their bottom line and just do not feel like paying the pensions
they promised their workers. It is this looming crisis in America's
pension system that brings us here today.

[[Page H11662]]

Now, no one believes we should sit and wait while America's pension
system crashes around us, but we need to address this problem in the
right way, and regrettably, Madam Speaker, the Pension Protection Act
the Republicans have concocted is not the right way.
Mr. Boehner, one of the authors of this bill, told the Rules
Committee yesterday that this bill is tough medicine. What he did not
say is that it is tough medicine for America's workers. Madam Speaker,
this bill will have a real effect on millions of Americans' lives and
on the quality of their lives as they grow older.
The fact is that this bill that Chairman Thomas and Chairman Boehner
have brought before us will make the problem worse, not better. This is
the wrong prescription for what ails America's pension system. Both the
Congressional Budget Office and the PBGC estimate that the Pension
Protection Act will actually lead to an increase in pension plan
terminations and an increase in the PBGC's liabilities by billions of
dollars. Clearly, that simply cannot be what anyone in this Chamber
really wants.
The goal should be to enact legislation that guarantees workers their
full pensions. Instead, passage of this bill will allow corporations to
turn their backs on their loyal employees and shirk the
responsibilities they face to provide a real pension to their
employees.
There exists in this country a culture of corporate corruption, where
companies like Enron and WorldCom squander billions of dollars in
retirement funds, and this legislation does not do anything, nothing,
to fix that.
Congressman George Miller, a strong champion of the American worker
and working families, recently released a report entitled: Broken
Promises--America's Pension Plans At Risk. This report shows that
pension plans are underfunded by $450 billion; that the PBGC is $23
billion in the red, with more obligations coming in every day, and that
the current pension and bankruptcy laws allow companies to dump their
unwanted pension obligations on to the PBGC. Proving that this bill
makes things worse and not better, the report documents that the
Boehner-Thomas bill could, and I quote, ``cause as many as half of all
large pension plans to freeze benefits.''
Ranking Member Miller, along with Ranking Member on the Ways and
Means Committee Rangel, have an answer. They have crafted a substitute
that actually protects workers' pensions. The substitute also reforms
the bankruptcy laws so that corporations cannot hide behind bankruptcy
in order to dump their pension obligations onto the PBGC.
In addition, the Miller-Rangel bill addresses a serious inequity
where rank and file pension plans are at risk of being dumped onto the
PBGC but somehow the corporate executives continue to receive golden
parachutes. A CEO should not receive millions of dollars in bonuses and
other incentives if they have terminated the pension plan for their
rank-and-file workers.
Now, I am sure my friends on the other side of the aisle will boast
about how their legislation they have crafted is fabulous. I disagree,
but I respect their right to have their say and to have their views
debated. Those of us on this side of the aisle believe we have a better
approach, one that is fair to millions of Americans and their families
who get up every morning, put in a hard day's work and are the very
backbone of America's economy and our communities.
Unfortunately, Madam Speaker, we will not have an opportunity to
present our proposal. The Republicans on the Rules Committee late last
night said, no, an alternative viewpoint will not be tolerated, cannot
be presented to the Members of this House, and it certainly will not be
debated and voted on on this floor.
Apparently, the Republican definition of democracy is my way or the
highway. They have decided that the United States House of
Representatives is really not a deliberative body, it is a place that
does not respect differing viewpoints, and it is unreasonable to have a
full and open debate on an issue as important as pension protection.
Last night, Chairman Boehner, to his credit, said he had no problem
with Democrats having an ability to offer a substitute. So what
happened? I will tell you what happened. The Republican leadership, in
yet another display of arrogance and disrespect, decided to close the
process, to gag us, to use the Rules Committee as a weapon to stifle
debate. Once again the Rules Committee is where democracy comes to die.
Now, let me say, with all due respect to my friends on the other side
of the aisle, it is the majority that is responsible for creating a
climate in this House that is devoid of bipartisanship and civility. It
is beyond my comprehension why the majority would deliberately choose
to shut us out of being able to offer an alternative.
This is not the House of only Republicans, this is the people's
House, where serious issues should be debated and voted on. This rule
is anti-democratic, this rule is closed, and this rule should be
defeated.

Broken Promises--America's Pension Plans at Risk: Independent Analysis
Finds That Republican Plan Makes Pension Crisis Worse

Broken Promises Put Millions of Americans' Pensions at Risk

Americans are worried sick about their retirement nest-egg,
and they are demanding decisive action by Congress. They saw
what happened at Enron and WorldCom and at other companies--
where billions of hard earned investments by employees
disappeared forever in only months due to corporate fraud and
mismanagement.
Today employees and retirees are watching as some employers
like United and USAir have rushed to dump their pension
promises onto the taxpayer and other employers, at the
expense of employees and retirees who face billions in
uninsured pension promises. Traditional pension plans, once
the sturdy pillar of retirement security, are very much at
risk unless Congress takes immediate action.
Here are the serious warning signs that threaten our
nation's pension plans:
Pension plans are now underfunded by $450 billion, up over
1,000% since 2000.
The agency that insures traditional pension plans (the
Pension Benefit Guaranty Corporation) is $23 billion in the
red, and is facing billions more in possible claims from
companies such as Delta Airlines, Delphi, and Northwest
Airlines.
Pension and bankruptcy laws allow companies to dump their
unwanted pension promises onto the PBGC, leaving taxpayers,
employees and retirees to foot the bill.
Like the savings and loan debacle of the 1980s, taxpayers
are at risk of having to pay billions of dollars due to
broken promises, this time by company-sponsored pension
plans.
Many employees and retirees face severe reductions in their
promised pension benefits as their plans are turned over to
the federal government, or frozen by companies when their
sponsor falls behind in their obligation to fund promised
benefits.
Employees are blindsided when their plan is dumped onto the
federal government because they are not provided up-to-date
information on the real financial condition of their pension
plan.
Employees and retirees in such cases are not only cheated
out of promised pension benefits, but sometimes suffer
further injury and insult by company executives who cut their
own sweetheart golden parachute deals.
Now Delta and Northwest are in bankruptcy and very well
could dump their pension plans onto the PBGC. According to
the PBGC, Delta Airlines is underfunded by $10.6 billion. The
PBGC loss would be $8.4 billion, and the employees and
retirees would lose $2.2 billion in promised benefits.
Northwest Airlines is $5.7 billion underfunded. The PBGC loss
would be $2.8 billion, and the employee loss even greater--
$2.9 billion. And now more dominos are falling. Delphi Auto
Parts has filed for bankruptcy--the largest such filing in
the history of the auto industry. According the PBGC, the
Delphi claim on the PBGC would be $4.1 billion. The hit on
employees--estimated over $10 billion in uninsured losses--
would be the largest ever. That tops the $6 billion in worker
losses that PBGC estimates occurred from its 4 previous
largest pension plan terminations.

Republican Proposal Actually Makes Pension Crisis Worse, Not Better

According to the Congressional Budget Office, the
Republican House Bill (H.R. 2830) passed by the Education and
Workforce Committee and Ways and Means Committee would
increase the PBGC's red ink by $9 billion over the next ten
years. The PBGC also analyzed the House bill and found it
would increase the agency's deficit bill billions more than
current law projections. Specifically, it found that
Republican House bill would permit pension sponsors to slash
required contributions by $75 billion over the next ten years
compared to contributions required under current law. The
PBGC's 35 page study released on October 26, 2005 analyzed
detailed information of 400 pension plans, representing 50%
of the liabilities and underfunding in the pension system.
The Republican proposal could cause as many as half of all
large pension plans to freeze benefits. The PBGC estimates
that more than 50% of a sample of large pension plans would

[[Page H11663]]

either have to freeze some or all benefits if the Republican
proposal's benefit limitation provisions had been in effect
(based on the Administration's most recent data.) The
limitations would prevent benefit increases and lump sum
payments for all affected plans, and prohibit future benefit
accruals by the most underfunded plans.
H.R. 2830 fails to reform pensions in several other
respects. The bill fails to stop companies from dumping their
obligations on to the federal government, fails to provide
employees with accurate information on the
financial condition of pension plans, fails to stop
executives from cutting and running with their own
sweetheart pension deal while slashing employee pensions,
fails to protect older employees when a company converts
to ``cash balance'' plans, permits conflicted investment
advice, and punishes employees for plan underfunding by
curtailing benefits.

Democrats Fight to Save and Strengthen Traditional Pension Plans

Democrats are fighting to save and strengthen pension plans
by: Stopping companies like United from dumping their
unwanted pension promises onto the taxpayers and employees.
Because the Congress didn't lift a finger to stop United from
unloading its pension plan, we have a new group of companies
ready to dump and run. The government should not be a cookie
jar for companies who failed to keep their fiduciary promise
to set aside funds for their employee pension plans.
Requiring pension plans to follow a clear and fair plan to
restore their pension funds. The pension bills going through
Congress right now actually make underfunding worse according
to the Congressional Budget Office and the PBGC government
pension insurance agency.
Requiring pension plans to give employees accurate, up-to-
date information on their pension plans financial condition.
Employees should never have to wake up one morning and read
in the papers that their pension plan has failed. Today,
sponsors of pension plans are permitted to keep two sets of
books, one set of books make available to the public and one
set of more accurate books that is kept secret by the federal
government.
Prohibiting company executives in charge of underfunded
pension plans from entering into sweetheart retirement deals
while they're moving to dump their employees pension plan on
to the taxpayers.

Conclusion

Millions of Americans have worked hard to earn the
retirement promised by their company. Without urgent,
decisive action by Congress, millions of Americans face the
loss of billions in irreplaceable like savings due to the
broken promises of their plan sponsor. The Republican answer
to this crisis is to hasten the unraveling of pension plans
by allowing companies to skip out on over $75 billion in
contributions over the next 10 years, and increasing PBGC's
red ink by billions of dollars. At the same time, Republicans
are refusing to stop companies from dumping their unwanted
pension promises onto the PBGC at the expense of taxpayers,
employees, and other employers.

Madam Speaker, I reserve the balance of my time.
Mr. HASTINGS of Washington. Madam Speaker, I am pleased to yield 3
minutes to the gentleman from Michigan (Mr. Ehlers), a member of the
committee.
Mr. EHLERS. Madam Speaker, I thank the gentleman for yielding me this
time.
Madam Speaker, I rise today in support of House Resolution 602, the
rule for consideration of the Pension Protection Act, H.R. 2830. Both
the rule and the bill are excellent. I would especially like to commend
Chairman Boehner and Chairman Thomas for their work on this very
important pension bill.
In recent years low-interest rates, the stock market decline, and the
increasing number of retirees have left many defined-benefit pension
plans underfunded. As a result, companies from many industries claim
that they will soon be unable to contribute the amount they are
required to contribute under law. In particular, the aviation and
manufacturing industries have been hard hit by these and other
financial difficulties, and the penalties under the current pension law
are creating tremendous financial burdens for already struggling
employers, and in fact encouraging them to go into bankruptcy so they
can get out from under the burdens of the current pension law.
The Pension Protection Act provides the long-term solution that is
sorely needed to shore up pension benefits for millions of Americans.
It makes the most comprehensive reforms to our Nation's traditional
pension system in more than a generation.
The bill ensures that employers fund their pension promises to
workers. It also keeps employers and unions from making pension
promises that cannot be kept. I would note that the manager's amendment
includes compromise language that will ensure that UAW retirees'
pensions are protected, something very important in my district and,
indeed, in all of Michigan.
I was surprised at the comments of the previous speaker, who has
attacked the bill on that point. And certainly if the UAW believes it
is a good bill, it cannot be as bad as the speaker claimed it is. In
fact, I believe it is a very good bill, and it is designed to address
the problems that he outlined.
The bill does not, however, ensure that airline workers' pensions
receive needed additional protection. The Senate bill, the Pension
Securities and Transparency Act of 2005, contains airline pension
provisions. The Senate bill allows the airlines to pay their pension
obligations over an extended period of time, ensuring that airlines can
fund their pension obligation and helping to prevent the Pension
Benefit Guaranty Corporation from becoming insolvent as a result of
taking on the burden of the airline pensions.
I understand that Chairman Boehner intends to support airline pension
provisions in the conference committee, and I strongly support him in
his efforts to include airline pension provisions in the final version
of the conference report.
I urge my colleagues to support this excellent rule and also
encourage them later in the day to support the Pension Protection Act
when it is considered.
Mr. McGOVERN. Madam Speaker, we will have an opportunity to debate
the substance of this bill, I guess not only during the rule but
afterwards, but I am still kind of baffled as to why this bill has to
be brought to the floor under a closed rule, why the ranking Democrats
on the committee of jurisdiction could not even be given the courtesy
of being allowed to offer an alternative. This is unbelievable to me,
that a bill of this importance would come to the floor and we are
entirely shut out.
And speaking of being shut out, the gentleman from Indiana (Mr.
Visclosky) had four amendments to be brought before the Rules
Committee. He waited patiently and testified before the Rules
Committee. Four good amendments, and all four of those were dismissed
routinely as well.
Madam Speaker, I yield 2 minutes to the gentleman from Indiana (Mr.
Visclosky).
Mr. VISCLOSKY. Madam Speaker, I rise today in strong opposition to
the restrictive rule for H.R. 2830, the Pension Protection Act, and I
ask my colleagues to join me in opposition.

{time} 1045

Last night not only were my four amendments disallowed, but a
substitute measure offered by Mr. Rangel and Mr. Miller was also
disallowed. From my perspective, given the importance of the underlying
legislation, we ought to have an open debate. We ought to have votes,
and we ought to have decisions made by the full membership.
In terms of the amendments I offered last night to the Rules
Committee, the first set essentially said that the funds in retirement
accounts are the workers' money, and employees ought to have a voice in
single employer pension plans regarding the management of those moneys.
Given the number of pensions that have been thrown overboard, and given
the tens of thousands of Americans who have been hurt, I also think, as
a bare minimum, companies ought to once, every 3 years, be required to
inform their employees of the health of their pension funds.
The third amendment I offered essentially said that every last
option, whether it be from the perspective of the PBGC or the company
be exhausted before that pension is assumed by the Pension Benefit
Guaranty Corporation, given the fact that, on average, at least 15
percent of the retirees who have their pensions assumed by the
corporation are going to receive less than their full promised pension.
A case in point was in United Airlines negotiations, the unions of
the company were still bargaining and the PBGC came in and unilaterally
assumed that pension.
The final goes to the heart of the matter, and that is to close that
gap. For those pensioners that do not receive their full pension under
the PBGC, they are out that pension money. I am disgusted by the fact
that they do not have standing under the

[[Page H11664]]

procedures. And I would use Adelphi Corporation, which recently
declared bankruptcy as an example of the abuse of the system and the
disadvantage that the employees are put under.
Adelphi, headed by Mr. Smith, who also was at Bethlehem Steel when
they went bankrupt and they dumped their pensions over, really has no
interest in going out of business. They want to dump their liabilities.
Under the Bankruptcy Code, Mr. Miller and up to 500 executives at
Adelphi are entitled to 30 to 250 percent bonuses for running their
company into the ground, going through bankruptcy, dumping their
liabilities and hurting people.
What happens to the workers who do not get their full pension after
Mr. Miller and his gang dump those pensions overboard, they have no
standing under the Bankruptcy Code.
All I asked the Rules Committee last night was that we ought to talk
about that here on the House floor and we ought to have a debate. Those
people who gave their lives to that company who are now short money for
the rest of their lives when they need it the most should have some
standing. I ask Members to oppose the rule.
Mr. Speaker, I rise today in strong opposition to this restrictive
rule for H.R. 2830, the Pension Protection Act and I ask that my
colleagues join me in opposition.
Last night in the Rules Committee, I offered four amendments that I
believe would have made this a better bill, none of which were found to
be in order. Furthermore, this restrictive closed rule does not even
make in order a substitute measure authored by Ranking Members Miller
and Rangel. In a time when Delphi will be awarding 500 executives,
bonuses of 30 percent to 250 percent of their base salaries, workers
are seeing their pensions frozen, I find it very troubling that the
majority refuses to have a full and open debate on an issue so critical
to our Nation's retirement security.
My first amendment would have put employee representatives on the
trustee board of single employer pension plans, which would ensure that
employees have a voice in how their investments are managed. The
growing significance of pension plans in the U.S. economy has sparked a
continued public debate over the control of pension fund investments. A
generation ago, Congress took action to safeguard pensions in response
to an Enron-like debacle at Studebaker. These protections for defined
benefit plans included diversification requirements as well as
government insurance. Pension funds represent deferred compensation and
there is no reason why single-employer pension plans still lack
employee representation on their boards.
My second amendment would have required that plan sponsors furnish
pension participants with the most current benefit statement at least
once every 3 years. Fiscally unhealthy pensions have caused severe
hardship on employees who have depended on their pensions as part of
their retirement security. In order for pensioners to have a more
complete understanding of the health of their pension fund, it is
necessary to provide full and accurate information on a timely basis.
Both the underlying bill as well as Mr. Miller's substitute address
this issue, but I do not believe that they go far enough.
My third amendment would make it more difficult for companies to
abuse the bankruptcy process in order to dump their pension
obligations. Specifically, this provision requires that alternatives to
pension-dumping be identified, which would essentially make pension-
dumping a last resort for companies rather than a financial-planning
tool. The amendment would require both employer-initiated and PBGC-
initiated terminations to identify and disclose alternatives to dumping
their pension obligations.
There is a disturbing trend of companies dumping their pension
obligations not because the company is going out of business, but
because the company does not want to follow through on the financial
commitment made to its employees. This legislation would make it more
difficult for financially-viable companies to engage in pension dumping
to increase their long-term profits. Current law does not sufficiently
protect against the termination of plans. By implementing this
provision, pension participants would have greater opportunity to work
with companies to find alternatives to eliminating existing pension
plans.
After a company successfully terminates its pension plan, the Pension
Benefit Guarantee Corporation, PBGC, takes over the financial
obligations to make payments to pensioners. In certain instances, the
maximum amount the PBGC will pay is less than the original amount
promised by the pension.
My final amendment would have made the cost of the pension payment
``gap'' an administrative expense for the company, which would make it
easier for pensioners to collect the missing funds in bankruptcy court.
Pensioners deserve the full pension amount they were promised. In cases
where the company goes bankrupt, and the PBGC payment is less than the
original amount promised, pensioners deserve to be near the front of
the line when it comes to collecting debts from the company in
bankruptcy court. I believe that a promise is a promise, and if a
company emerges from bankruptcy with the finances to pay the difference
of a lower pension, they should do so.
Once again, I urge my colleagues to oppose this restrictive rule.
Mr. HASTINGS of Washington. Madam Speaker, I yield 3 minutes to the
gentleman from Georgia (Mr. Price), a member of the committee.
Mr. PRICE of Georgia. Madam Speaker, I thank the gentleman for
yielding me this time to address both the rule and the bill.
Madam Speaker, I rise in support of the rule and the bill. And
frankly, I never cease to be amazed by some of the discussion from the
other side, for oftentimes they accurately identify the problem, and
then completely ignore the solution.
Madam Speaker, traditional pension plans once the legacy of a
lifetime of work are crumbling. They are crumbling. We are able to
bring this bill to the floor today for swift passage because there is
an ever-growing coalition of support behind it from labor and employer
groups to other individuals who know acutely the problem that we have.
Action by Congress is necessary to protect the important retirement
of all hardworking Americans. Large and small businesses need changes
to current law in order to have greater flexibility to help their
employees plan for their financial security.
Current plans, defined benefit plans primarily, have not adapted to
the times. They have used the same formula since their inception: The
number of years worked multiplied by a certain amount of money. This
formula does not account for a changing marketplace, and it does not
result in the most benefit for workers. Today, a retirement plan must
be as dynamic as our society. Inflexibility for both employers and
employees is imperative. This Pension Protection Act is a step in the
right direction, and it is important that Congress pass it.
A couple of the provisions I would like to highlight are reforms.
These are significant changes and require employers to make significant
contributions to the plans to meet 100 percent of the funding target.
That is an improvement. This bill provides for a permanent interest
rate to more accurately measure liabilities. That is an improvement. It
appropriately raises premiums that employers pay into the PBGC. We
understand and appreciate that the PBGC, that cushion between pension
plans and the taxpayer, needs to be more financially secure. It
requires defined benefit plans to include detailed information and
greater disclosures, and allows employees to receive better investment
advice. Madam Speaker, these are all improvements.
The other side says this allows employers to shirk their
responsibilities. Frankly, that is just plain wrong. Without reform,
the system may very well collapse under the weight of mounting deficits
and the government and taxpayer bailouts are not fair for employers,
they are not fair for employees, and they are not fair, certainly, for
taxpayers. Americans expect us to solve difficult problems. The Pension
Protection Act is one of those things that requires and deserves ours
attention.
I urge my colleagues to support both the rule and the underlying
bill. I also look forward to the discussion with the chairman of the
committee during the debate on the bill itself, and highlight the need
for reform in the airline industry, which, in my area and across this
Nation, is so drastically calling out for reform.
Mr. McGOVERN. Madam Speaker, the gentleman from Georgia just gave a
nice speech, but nobody on that side has explained why on this very
important issue that the Democrats and people with alternative views
should be entirely locked out from participating in amending this bill.
This is an outrage.
Madam Speaker, I yield 2 minutes to the gentleman from North Dakota
(Mr. Pomeroy).
Mr. POMEROY. Madam Speaker, I thank the gentleman for yielding me
this time.

[[Page H11665]]

Madam Speaker, I see the chairman of the Committee on Education and
the Workforce is in the Chamber. I want to give him initially a
compliment. That committee has had a number of hearings. I believe the
gentleman has wrestled with this issue, and I believe he has come up
with a deeply flawed solution, but I give him credit for an initial
effort.
Now on the other hand the chairman deserves much rebuke for
tolerating the process that is unfolding here.
Madam Speaker, getting pension funding fixed, getting this done
correctly is a technically exacting proposition with enormous risks
because if we miss the mark, pension plans are going to terminate.
Pension plans are going to freeze. Millions of workers will lose their
pension coverage. This is not a Republican thing, it is not a Democrat
thing. Trying to get this right ought to be a shared purpose, and so
how dare you participate in a process that does not give us a
substitute? Your way is not the only reasonable way. Reasonable minds
differ here. There are issues that we put forward in our substitute
that were important for consideration by this body.
The legislative process ought to be run with a fundamental fairness
that allows the consideration of various issues. There are a lot of
important constituencies watching this debate, and I want them to know
that the chairman of the Committee on Education and the Workforce
complicit with the chairman of the Ways and Means Committee complicit
with the majority leadership of this body worked to shut down the
process, to shut out the consideration of other views, to present only
their way or the highway as an ultimate resolution of this issue.
I firmly believe that healthy pension plans today will terminate or
freeze their benefits for other workers going forward, because I
believe this is a deeply flawed proposal, and I know there has been an
effort to pick a group here and pick a group there and make a
compromise here and make a compromise there, but the core of the bill
is rotten and we could have had a much better result. Shame on you for
depriving us of our alternative. Defeat this rule.
Mr. HASTINGS of Washington. Madam Speaker, I yield 2 minutes to the
gentleman from Florida (Mr. Weldon).
Mr. WELDON of Florida. Madam Speaker, I rise in support of this rule
and the underlying bill.
I believe this piece of legislation is one of the most important
pieces of legislation that we will take up in the 109th Congress, and I
do not believe it is getting an adequate level of public attention
considering the enormity of the significance.
In my 11 years in the House of Representatives, I have seen more and
more the movement of our economy into a global economy where our U.S.
corporations are increasingly finding themselves having to compete no
longer with other domestic corporations, but foreign companies that
operate under very, very different rules in their domestic country of
origin, and particularly as it relates to pension plans.
What I am getting at, Madam Speaker, is that we desperately need to
modernize our pension laws and probably most importantly, more than
anything else, we have seen tragically, in recent years, many workers
come to their retirement years to find that their pension plans are
insolvent, that the company that had guaranteed them a retirement is
bankrupt, and increasingly that these pension plans are underfunded.
Now is this a perfect bill? No. There is no bill that comes through a
legislative process as complex as this involving two committees that
anybody can label as perfect. But this is moving us in the right
direction. We are going to go to conference with the Senate and what is
going to emerge is going to be a good bill. I think this is a very good
product.
Chairman Boehner and Chairman Thomas deserve a great deal of credit
for the effort and hard work they have put into this. I believe this is
going to have ramifications for protecting our workers and making our
companies more competitive in this global marketplace so we can
increasing compete effectively and create jobs and protect jobs and
defend the hardworking American people who are depending on these
retirement plans to be there in their retirement years.
Mr. McGOVERN. Madam Speaker, I yield myself such time as I may
consume.
Madam Speaker, once again, we heard an interesting speech but no
explanation as to why we have to bring this bill to the floor under a
closed process and why we are shut out from even offering an
alternative.
Madam Speaker, I yield 4 minutes to the gentleman from California
(Mr. George Miller).
Mr. GEORGE MILLER of California. Madam Speaker, I thank the gentleman
for all his hard work on the Rules Committee.
It is rather interesting, and Mr. McGovern has alluded to this a
number of times, but it is interesting today as we watch with great
anxiety and anticipation and a sense of celebration as Iraqis run the
gauntlet of violence to go out and vote for democracy, at the same time
the Republicans in the House of Representatives close down democracy in
the people's House.
Republicans, a number of them stood up here today and said this is a
very complex bill. This is the most important bill that may come before
this Congress because it affects millions of Americans' livelihoods and
retirements, but it has to come under a closed rule. It cannot
withstand debate, it cannot withstand amendments, and it cannot
withstand changes. That is the death of democracy in the people's
House.
So let us applaud it in Iraq today, but let us understand what is
happening here, the gradual glacial process of destroying debate on the
floor of the House of Representatives and the right of Members. Mr.
Visclosky wanted to talk about people who were being impacted by these
policies who were losing their jobs and losing their workplace and
losing their retirement benefits, but he was not going to be allowed to
offer those amendments to have that amendment because of the autocratic
nature of the Republican leadership in this House. They cannot stand
democracy, they cannot stand open rules, and they cannot stand open
debate. Because it is their way, as Mr. McGovern says, or the highway.
This Republican pension bill is the greatest assault on the middle
class standard of living in the history of Congress because this bill
accelerates the process by which millions of American workers will lose
the retirement nest eggs that they were counting on. They will lose the
security of their golden years, if you will, because of the accounts
that they were counting on.

{time} 1100

And it need not happen. It is not just about the organized plans, UAW
or the Teamsters or the building trades. This is about millions of
Americans who do not have the benefit of a union, who do not have the
benefit of collective bargaining, because in a survey of the major
employers by the Benefits Association, 60 percent of those people say
that this bill will cause them to freeze their plans, freeze their
retirement benefits. You can continue to work, but you will not
continue to get any retirement, additional retirement benefits.
What does the CBO say about this bill? It says it makes this problem
$9 billion worse for the Pension Guaranty Corporation. What does the
Pension Guaranty Corporation say about this bill? That it will make it
billions of dollars worse over the next few years. So we have made the
problem worse, which is the solvency of the Pension Guaranty
Corporation, and that is a corporation that protects pensions that now
is anticipating hundreds of billions of dollars of potential
liabilities in the future.
So we accelerate the problem and we diminish the capacities of the
government to deal with this and the ability of the private sector to
deal with it. And interestingly enough, we make it easier for
corporations to simply get rid of these pension benefits without
negotiations just as United Airlines did. We were told that a couple of
those plans possibly could have been saved, according to the Pension
Guaranty Corporation. Two days later they were put into bankruptcy.
This pension plan was designed when corporations went out of
business. The

[[Page H11666]]

gentleman from Indiana is here. When Studebaker went out of business we
created this because there was no more company. Yesterday in USA Today
United Airlines announced it is coming out of bankruptcy and a couple
of hundred executives are going to take 15 percent ownership in the
company and they are going to leave bankruptcy with $285 million in
their pocket, in their pocket. And those workers who gave back their
pensions, gave back their wages year after year after year to help this
airline which was mismanaged and run into the ground, they leave with
nothing. You say, oh, they have a job. Well, the people who are
responsible, the executives for running this company, they leave with
stock bonuses.
That is what this bill does. It continues this problem, this absolute
problem of corruption of the rights of people to protect their
retirements.
Mr. HASTINGS of Washington. Madam Speaker, I yield 3 minutes to the
gentleman from Indiana (Mr. Souder).
(Mr. SOUDER asked and was given permission to revise and extend his
remarks.)
Mr. SOUDER. Madam Speaker, I appreciate my friend and colleague from
California's passion, even when he is wrong and overstates his case.
The comparison to Iraq is just such an egregious misrepresentation of
American democracy to anybody in the world who is watching this. We sat
in the Education Committee for days, into the late hours of the night
taking amendment after amendment. They lost the amendments. That does
not mean democracy does not work. It means that we spent in the areas
of the subcommittee and the committee working this for years, working
through committee and bringing the document to the floor with many
compromises in it.
Now, I share some of the concerns of my colleague from California,
because I have had a frustration in watching people who work their
whole life, see their pensions reduced or eliminated at the time some
of the executives have enriched themselves. And I supported this bill.
I supported this bill because long term it will help the Pension
Guaranty Corporation, but short term our goal has to be how are these
companies not going to go into bankruptcy? How can we make sure that
they can function, have their pension funds there and avoid the
problem, and then long term stabilize the Guaranty Corporation?
Secondly, as a representative of the number one manufacturing
district in America, I have more manufacturing jobs and percentage of
the work force in my district in manufacturing than any other, I was
very concerned about some of the provisions and how this might relate
to GM. I very much appreciate the leadership of Chairman Boehner in our
committee of working first the process through so that people have the
hopes of pension. I mean, we all understand the basic principle here.
We have the same problem in Social Security. We are more underfunded,
quite frankly, than private areas. We have this in Medicare. We have
this in any savings program where we assumed there was going to be a
huge work force paying in and now it is a declining work force paying
into a huge retirement population. How do we work this through? This
bill is an attempt to address it in a comprehensive way. But I was
concerned about a provision that would allow the basic pensioners to
have to pay first. In other words, there would have been the option,
even when the company had an ability, through changing their funds
around, to not freeze pension wages, and pension benefits, that they
could have done so.
Chairmen Boehner and Chairman Thomas have fixed this. This is now
supported by the UAW and by GM. That is a pretty big accomplishment, to
have a pension bill supported by the UAW and GM, and I want to commend
the leadership of the Education Committee, Chairman Boehner and the
chairman of the Ways and Means Committee for working out this critical
thing so that management does not get crippled in their ability to put
funds in to strengthen these pensions. At the same time, people who are
50, 55, already retired, who do not have the ability to adjust their
pensions will not get it arbitrarily frozen. And I think this is a
great compromise that had hours and hours and days and days of work on
this, and it is an example of how democracy works, not how it does not
work.
Mr. SOUDER. Madam Speaker, I rise today to commend the distinguished
chairman of the Education and Workforce Committee for putting together
a well-balanced bill to reform our Nation's outdated pension laws.
Putting this bill together has been a long and difficult process, and
the Chairman should be commended for his perseverance and diligence.
Our Nation's pension laws have not undergone comprehensive reform for
over 30 years. Unfortunately, the recent examples of United Airlines
and Bethlehem Steel show that this system is broken. We cannot have a
situation where companies continually underfund their pension plans, go
bankrupt, and then transfer their pensions to the PBGC. Workers lose
the money they were depending on for retirement, and American taxpayers
are expected to pick up the slack for companies' irresponsibility.
H.R. 2830 will help ensure that workers' pensions are better funded.
It changes current law to require plans to be 100 percent funded. If
plans are underfunded, this bill will force companies to make up their
shortfall in 7 years. H.R. 2830 will also help stabilize the PBGC by
raising the premiums companies pay for the PBGC's protection. Further,
by requiring employers that terminate their pensions in bankruptcy to
pay an annual premium of $1,250 per participant to the PBGC for the 3
years after they emerge from bankruptcy, this bill makes terminating
pension plans a less attractive option for employers. Companies who
want to dump their pensions to escape bankruptcy and raise their bottom
line will have a tougher time doing so.
Furthermore, the Pension Protection Act will help stop the
unacceptable practice of labor and management negotiating for pension
benefits that both sides know are unaffordable. If a pension plan is
underfunded, it will not be able to increase benefits or pay shutdown
benefits unless it pays for such benefits immediately.
I would also like to commend Chairman Boehner for his efforts this
week to reach an agreement with the United Auto Workers union over
their concerns with the bill. Mr. Chairman, I have the largest
manufacturing district in the country, and many union members let me
know their concerns with this bill in its original form. Unfortunately,
this bill would have allowed some companies to freeze their employees'
pension benefits and limit accruals--even if they had the money to fund
them. The agreement that Chairman Boehner reached with the UAW requires
companies to use all the money in their plan before they can freeze
benefits and limit accruals. This will prevent companies from gaming
their funded status in order to deliberately trigger these benefit
restrictions.
Again, I thank Chairman Boehner for his hard work writing a bill
supported by such a broad coalition of both labor and management
groups, and urge my colleagues to support it.
Mr. McGOVERN. Mr. Speaker, I yield myself such time as I may consume.
The gentleman from Indiana tells us we should all be happy because
the Education Committee deliberated on this and there were votes in
that committee. I should remind the gentleman that there are 49 members
of the Education Committee. There are 435 Members of the House of
Representatives.
The gentleman gets all upset when Mr. Miller talks about the fact
that it is important for us to be an example to Iraq about what
democracy is, and that there are elections in Iraq and, you know, here
we are engaged in an undemocratic process here today. But I will say
this. At least in Iraq everyone has an opportunity to vote. Here we are
being denied an opportunity deliberately on this floor on an issue that
impacts millions and millions of our fellow citizens. This is an
outrage. You know, I am amazed that people on the other side, who only
a few years back would decry a closed process like this, have now come
to embrace this process. This has become the norm in this House, and it
has to stop. This is not democracy. This is not a deliberative process.
This is a closed process where legitimate, important debate on
important issues is being denied routinely.
Mr. Speaker, I yield 3 minutes to the gentlewoman from Texas (Ms.
Jackson-Lee).
(Ms. JACKSON-LEE of Texas asked and was given permission to revise
and extend her remarks.)
Ms. JACKSON-LEE of Texas. Mr. Speaker, I have to join the gentleman
from Massachusetts on his concern and dismay, frustration, and I think
that outrage that the opportunity for a Democratic substitute, first of
all, to express some of the failures of this particular underlying bill
and as well the opportunities to improve this legislation seemingly has
been denied.

[[Page H11667]]

I speak from a particularly unique perspective, Mr. Speaker, because
my district contained Enron, and the thousands of employees that,
within hours of the bankruptcy filing by Enron, lost not only their
jobs but their lives, their homes and their future. I cannot tell you
the number of individuals in Houston and the surrounding areas and
other areas that were impacted, lost their lives, actually died because
of the absolute oppression and outrage and the impact of what happened
to them.
And then we speak to the pensions and the investment of course in
company stock. But this particular bill as it relates to the pension
issue just does not go far enough because what it happens to do is it
emphasizes the pension crisis, and it causes many of the companies, and
I think those who are listening beyond the borders of this particular
Chamber should understand that this bill that will be voted on today
really causes companies to freeze or abandon your pension plans. This
does not encourage investment in your pension plans. It also denies the
necessary flexibility and relief for airlines that unfortunately did
not get in this bill, but is in the Senate bill.
Any of us who fly the Nation's airways know that the flight
attendants are constantly saying that we, after 20 years and 30 years,
are being forced to give up our pension rights. Why could we not come
to the floor of the House and have a better plan?
This, of course, provides a funding crisis that is far worse. It
increases the debt by $9 billion. It causes companies, it does not stop
companies from dumping underfunded pension plans onto taxpayers. And
so, if you want to look into the eyes of despair, just follow the track
of Enron when those particular employees who had bought into the
seriousness and the depth of commitment called family that Enron
represented, and in a matter of a pen, in the matter of 48 hours, they
were not only dumped, their pensions were dumped and they had nothing.
What we should be doing in this instance is then ensuring and shoring
up those liabilities or the potential of those liabilities and the
negative impact it would have on people who work so very hard.
I would ask my colleagues, we have enough time. There is time to
continue this debate and to send this particular underlying bill back.
There is time to make this bill compatible with the Senate before it
even leaves the House. There is time, I guess if we wanted to waive the
points of order, to allow a democratic substitute. But this is not the
route that we should be taking. And in the name of those who we
pretended to be concerned about, not only the Enron employees who spent
almost 2 years with us here in the United States Congress, but other
employees and workers around America, I would ask my colleagues to send
this bill back and make a better bill.
Mr. HASTINGS of Washington. Mr. Speaker, I yield 3 minutes to the
gentleman from South Carolina (Mr. Wilson).
Mr. WILSON of South Carolina. Mr. Speaker, I rise in strong support
of this rule and of H.R. 2830, the Pension Protection Act of 2005. I
sincerely appreciate the strong leadership today of Mr. Hastings, as he
is certainly presenting this in a very positive manner. I commend
Chairmen Boehner and Thomas for crafting just a comprehensive and
necessary legislation. This measure will both preserve and strengthen
our private sector, employer sponsored retirement system for both
current and former retirees.
This legislation, when enacted, will provide the most significant
reform of our pension system since the initial passage of ERISA in
1974. This legislation will require higher levels of funding for single
employer plans and provide the tools necessary to trustees, both labor
and management, of multi-employer plans to more effectively deal with
distressed plans. This legislation is the product of more than a year
of hard work among Congress, the executive branch and a broad coalition
of employers, labor unions and retirement system advocates. This
coalition strongly supports passage of the Pension Protection Act of
2005, and it will go a long way toward preserving the benefits of
millions of American workers and their families.
That is why it is so disheartening to see the Democrats and their
leader Nancy Pelosi continue their just say no obstructionism by urging
their Members to oppose this critical legislation. Rather than support
pension reform that would aid American workers, the Democratic
leadership continues its cynical and destructive strategy of opposing
all substantive legislation in a futile attempt to influence public
opinion against the Republican Congress. The opposition's motives could
not be more transparent on this issue.
Employers, including auto makers, airlines and manufacturers, along
with labor unions, including the United Auto Workers, Carpenters,
United Food and Commercial Workers all support this reform measure and
have urged all Members of Congress to support passage of H.R. 2830. For
those Members on the other side of the aisle who demonstrate courage
and reject their leadership's contemptuous call to oppose this
legislation, you will be rewarded by the gratitude of your constituents
and all Americans for doing the right thing.
I urge all Members to support retirement security reform and vote yes
on H.R. 2830.
Mr. McGOVERN. Mr. Speaker, I yield myself such time as I may consume.
Let me just again say to the gentleman from South Carolina who just
spoke, what we are asking for here is an opportunity to offer what we
think is best. We disagree with you. We disagree with your approach.
Not only do we disagree with your approach, the AARP disagrees with
your approach.

AARP,

December 12, 2005.
Dear Representative: AARP is writing to express its
opposition to a number of critical elements of H.R. 2830, the
Pension Protection Act of 2005, scheduled for House
consideration this week. We share the goal of enacting new
pension funding rules that will require employers to fully
fund their pension plans and provide new revenue for the
Pension Benefit Guaranty Corporation. These changes are long
overdue and should be enacted into law as soon as possible.
However, we cannot support legislation that would clarify the
legal status of cash balance pension plans without providing
protections for older, long-service workers involved in cash
balance plan conversions and without including a prohibition
on all discriminatory age based ``wearaway.'' We are also
deeply concerned that this bill would, for the first time,
permit defined contribution pension plans to provide
investment advice subject to inherent financial conflicts.
1. Cash Balance Pension Plans
AARP believes that cash balance plans have a role to play
in the private pension system if--and only if--they are
designed and adopted in a manner that protects the millions
of older workers who have given up wages in exchange for
traditional defined benefit pensions.
Cash balance pension plan conversions change the rules in
the middle of the game, and older, longer-service workers are
at considerable risk. They generally lose out on larger late
career benefits, have less time to accumulate benefits under
the new cash balance formula, and are less able to leave
their current job if benefits are cut because they typically
have fewer job prospects.
H.R. 2830 does not protect older and longer-service workers
that are involved in cash balance pension plan conversions.
The bill represents a step back from the Administration's
legislative proposal, which would eliminate wearaway (both
normal and early retirement) and provide transition rules to
protect some benefits for current workers. The recently
passed Senate bill includes similar protections. The current
legislation clearly fails to recognize the need for
transition rules to protect promised benefits and fails to
protect the most vulnerable older, longer service workers.
H.R. 2830 would not only lower the bar for transition
protections for older workers set in the Administration
proposal, but would lower it substantially below the ``best
practices'' followed by companies involved in conversions
over the past few years. Many employers--recognizing the harm
to older workers--have adopted transition rules, such as the
choice to remain under the old plan formula, or have
``grandfathered'' older, longer service workers under the
traditional plan. As recent reports by both the General
Accounting Office and AARP confirm, most employers have
adopted transition practices designed to protect the benefits
that older and longer serving employees have earned. Any
legislation should ensure these protections for older
workers, not undercut them.
2. Investment Advice
AARP shares the Committee's goal of increasing access to
investment advice for individual account plan participants,
but we oppose the elimination of the conflict-of-interest
protection. The approach advanced in this bill would, for the
first time, permit plans to provide advice subject to
inherent financial conflicts. This is inconsistent with the
Employee Retirement Income Security Act's (ERISA)
longstanding protections for plan participants. While we
agree that individualized advice can be helpful, such advice
must be subject to ERISA's fiduciary rules, be based on sound
investment principles, and be protected from conflicts of
interest.

[[Page H11668]]

H.R. 2830 would turn back the clock and replace ERISA's
prohibition on conflicts of interest with a weak disclosure
model--an inappropriate and unnecessary step given today's
marketplace. Over half of existing plans already provide
investment advice to their employees through financial
institutions and firms that do not have a financial conflict.
In fact, most large financial service providers have already
developed alliances with independent advisors to make such
advice available.
Rather than permit advice subject to financial conflict,
Congress should encourage more employers to provide
independent advice by addressing the key barrier--employer
liability. Potential employer liability is by far the most
important reason that advice is not offered. Congress should
clarify that the employer would not be liable for specific
investment advice so long as the employer undertook due
diligence in selecting and monitoring the independent advice
provider. It is in the best interest of both the plan and
participants to enhance the independent advice market, and we
urge Congress to adopt this approach.
AARP urges you to stand with us in opposition to these
critical provisions in H.R. 2830 in order to provide
protections for older workers that are necessary, reasonable
and fair, and to ensure that employers provide quality
investment advice without the potential for conflict. If
there are additional questions or you need further
information, please feel free to call me or have your staff
contact Frank Toohey at (202) 434-3760.
Sincerely,
William D. Novelli,
Chief Executive Officer.

Mr. McGOVERN. Mr. Speaker, I yield 4 minutes to the gentleman from
Michigan (Mr. Levin).
(Mr. LEVIN asked and was given permission to revise and extend his
remarks.)
Mr. LEVIN. Mr. Speaker, I mostly want to talk about substance. But
you know it is so hypocritical for anybody on the majority side to come
here and say that the minority is just saying no when you will not
allow us to put on the floor a substitute to which we want to say a
resounding yes. That is really hypocrisy. This is too important a
subject to be governed by the tyranny of the majority. We need to
strengthen and to save defined benefit plans in this country. This is
the question. Will this bill do that? And I think the answer is
basically, in all likelihood, it will not strengthen and preserve, but
it will weaken and over time eliminate.
Look, when it came to Social Security your mantra was save,
strengthen Social Security. And the President, in this Chamber, used
those terms, when the real purpose was not to save and strengthen
Social Security. The purpose was to replace it. And there is a
legitimate issue here, whether what you are proposing here, when
combined with the Senate's and with the administration's position, will
it preserve and strengthen defined benefit plans or will it likely
undermine?

{time} 1115

And the answer, I think, is that it will do the latter.
When we come to the general debate, I am going to be talking about a
number of the factors. There are four key factors at play in this bill.
They are technical, but they are vital: the yield curve, the credit
balance issue, the credit rating or how assets are evaluated, and the
averaging and smoothing issues.
As to just one of them, the yield curve provision in this bill, the
people who work with these issues, the chief financial investment
people, 60 percent, say essentially that most of the pension plans are
going to either be frozen or they are going to be eliminated. That is
what 60 percent of these officers say will be the result.
So you are not going to be protecting workers from underfunded
pension plans. What you are going to be doing, essentially, is putting
in place rules that will make it difficult for pension plans to exist
and, therefore, they will be withdrawn, if not, frozen. So that is
really the basic issue here. And it is heightened because of the
administration's position. They want to so tighten the rules that it
will be hard for any of these defined benefit plans to survive.
So this is the basic issue, whether in this country we want to try to
preserve defined benefit plans. Most of them are not in trouble. Many
of them would be placed in trouble through a combination of the
provisions in this bill and in the Senate bill.
So I want to close with this: What you are saying, and you have said
it on the floor, is leave it to the conference committee. For example,
there is no protection for airline workers here at all. Leave it to the
conference committee. What you have said to a few of the people is we
will make some adjustments here in this bill, but there is no assurance
that those adjustments will prevail. So in a word, what you are trying
to do is not protect defined benefit plans, but through these
provisions and those in the Senate bill, with the help of the
administration, you are going to accelerate their demise. That is our
position. And it is worthy of discussion. It is worthy of debate, and
it is worthy of your giving us a substitute that would make sure that
defined benefit plans can survive in the United States of America for
the workers of this country.
Mr. HASTINGS of Washington. Mr. Speaker, I yield 3 minutes to the
gentlewoman from North Carolina (Ms. Foxx).
Ms. FOXX. Mr. Speaker, I rise in strong support of this rule and the
Pension Protection Act. Over the past several years, we have all
witnessed some disturbing occurrences as we have seen far too many
hardworking Americans contribute money into a pension plan, only to
find their benefits dwindle or depleted entirely.
We must find ways to ensure that employers keep their promises to
their retiring workers. I believe we have done so in this bill.
Chairman Boehner and Thomas are to be applauded for their determination
to make this happen. They have spent countless hours in negotiations
with employers, employees, unions, and all other parties who have a dog
in this fight. The resulting bill we consider here today does exactly
what its title says: It further protects the pensions of America's
workers.
As I see it, the two most important parts of the Pension Protection
Act are provisions to require more accountability and provisions that
ensure fiscal responsibility. This bill strengthens current law and
requires more accountability on the part of employers in funding their
workers' benefit plans. It requires employers to put more cash
contributions into worker pension plans. It closes loopholes allowing
underfunded plans to skip pension benefits, and it calls for more
transparency about the status of workers' pension plans. How can anyone
oppose instilling more accountability into the pension system?
The Pension Protection Act is supported by a broad coalition of labor
unions and employers like the United Auto Workers, the Brotherhood of
Carpenters, the U.S. Chamber of Commerce, and the Financial Services
Roundtable. The bill includes a broad package of multiemployer reforms
sought by unions and employers. In addition to these reforms, the bill
ends excessive compensation for executives if an employer plan is
severely underfunded. It also insists on more accountability by
prohibiting employers and unions from offering pension benefit
increases when plans are already severely underfunded.
The Pension Benefit Guaranty Corporation is suffering from a $23
billion deficit. Unless we want all taxpayers to pony up and bail out
the PBGC, we must demand reforms to place the defined benefit system on
more solid ground. We must continue to fight for fiscal responsibility.
I urge my colleagues to support this bill.
Mr. McGOVERN. Mr. Speaker, I yield myself the balance of my time.
Mr. Speaker, there are numerous problems with this bill. This bill,
as Republicans have drafted it, makes the pension crisis worse. This
bill would cause many employers to freeze or terminate pensions. This
bill does nothing to protect the struggling American Continental,
Delta, and Northwest Airline employees and retirees. This bill does not
stop companies from dumping pension plans in bankruptcy or protect the
United Airline employees and retirees. The bill would freeze and cut
worker pension benefits. The bill does not ensure fairness between
workers and executives. I mean, I could go on and on and on.
The bottom line is that many of us who have been on the side of
workers consistently have deep concerns about this bill and what its
impact will be on working families. We think that this bill should not
only be much better, but, in fact, this bill, as it stands, will

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be harmful to American families. And there will be a debate about that,
but absent from the debate will be what we want to propose, what others
in this House want to propose, what other ideas may be.
Let me just say to my friends on the other side of the aisle that you
are not perfect. You are not always right. In fact, you are usually
wrong. And when it comes to workers, you are usually wrong, in
protecting workers' rights. To allow a bill this important to come to
the floor without a single amendment being made in order, to allow this
bill to come to the floor and shut us out and gag us is unconscionable.
For the life of me, I cannot understand what the hesitation is by the
leadership on that side of the aisle to allow us to be able to
deliberate on this bill, to have a give and take, to be able to offer
an amendment, to be able to have an up-or-down vote.
The distinguished chairman of the Education Committee, when he was
before the Rules Committee last night, said he had no problem with our
offering an alternative. I commend him for that. I mean, that is the
way this should be. We disagree. We have honest disagreements. We
should be able to work them out in a deliberative way on the House
floor. But here we are on a bill that impacts millions and millions of
Americans, a bill that we believe adversely impacts millions of
Americans, and we are totally shut out of this. It is not because of
lack of time. We have plenty of time today. And the immigration bill
seems all messed up; so we even have more time than we thought. But the
fact of the matter is this important kind of legislation should not
come to the floor under a closed process. This is outrageous. This has
become the norm in this House.
And I would simply say to my colleagues on the other side of the
aisle, someday the tables are going to turn. You are going to be in the
minority again, hopefully sooner rather than later. I hope nobody over
there cries and shouts and complains if a bill comes to the floor under
a closed rule.
Defeat this rule.
Mr. HASTINGS of Washington. Mr. Speaker, I yield 6 minutes to the
gentleman from Ohio (Mr. Boehner), the chairman of the Committee on
Education and the Workforce.
Mr. BOEHNER. Mr. Speaker, I appreciate my colleague from Washington
for yielding me this time.
And I appreciate the concern that my colleague from Massachusetts has
raised. Now, if this bill was as bad as the gentleman has tried to
define it, why would we bring it to the floor? Why would any Member of
this House seek to bring a bill to the floor that would hurt American
workers?
Mr. McGOVERN. Mr. Speaker, will the gentleman yield?
Mr. BOEHNER. I yield to the gentleman from Massachusetts.
Mr. McGOVERN. I can say why do you bring most of the bills that you
bring to the floor that I think adversely impact American workers, from
repealing worker protections and worker benefits.
Mr. BOEHNER. Mr. Speaker, reclaiming my time, I think the gentleman
is well aware that there is a crisis in America when it comes to the
issue of protecting people's pensions. And I think all of us on both
sides of the aisle have a responsibility to work hard, to develop
legislation that will, in fact, protect American workers and retirees
in the pensions that they have been promised.
Over the last 5 or 6 years, I have spent hundreds and hundreds of
hours meeting with stakeholders from companies that offer plans
voluntarily to union members and others, trying to craft a bill. We
have worked with Members on both sides of the aisle in order to develop
this legislation.
So what are the goals here? The goals here are, very simply, to make
sure that those companies who offer defined benefit pension plans
continue to keep them. Secondly, for companies who make promises to
their workers, there ought to be some insurance that they will keep the
commitments that they have made to their workers. And, thirdly, to the
Pension Benefit Guaranty Corporation that ensures that these pension
payments will be made, we need to strengthen the financial condition at
the PBGC to avert a possible taxpayer bailout in the future.
What does this underlying bill do? It will, in fact, ensure that
there is more money contributed to these pension plans, whether it is
restricting the use of credit balances, whether it is using a more
accurate interest rate to determine what those obligations are, whether
it is closing down the amount of averaging that goes on. There are a
number of provisions that we will talk about when we get into this bill
that will strengthen these pension plans by moving more money into
them.
The second part of this is to reduce the long-term exposure to the
Pension Benefit Guaranty Corporation that is, in fact, facing a
deficit. We not only increase premiums paid by employers to the Pension
Benefit Guaranty Corporation as part of strengthening them; but long
term, by requiring companies to fully fund their plans at 100 percent,
we will, in fact, reduce the exposure of the PBGC long term to a
taxpayer bailout.
Now, we are going to hear a lot of debate today as this bill comes up
from those who have their own views as to how this should work, and I
would ask my colleagues let us not make perfect the enemy of the good.
We have a very good, sound bill that we are bringing to the floor,
supported by many employer groups, supported by virtually every major
labor group in America as well. There is a finely tuned balance in this
bill, and I do, in fact, believe that it will pass today with broad
bipartisan support.
Now let me address one other issue. And that issue is the fact that
there is no substitute today. As the gentleman knows, in the Rules
Committee last night and in a letter to the Rules Committee yesterday,
I asked them to make a substitute in order. There was a question posed
to me last night about supporting such a measure. And I said I would
support not only amendments, but also a substitute as long as it did
not contain tax issues in there that were unrelated or dealt with the
tax side of this bill. I do not know whether the substitute had these
or not. But all I can say is that there is no one in this House who has
argued more for a fair, open debate than I have.
I have been in the minority. I have been in your position. I have
made the arguments that you are making, and I do believe that when we
stymie debate in the House, we short circuit our constitutional
responsibilities.
I am sorry there is not a substitute here. I am not sure why, but I
am sure there are very good reasons. Whether there are tax issues
involved in what you were offering, I do not know.
But the fact is that it is a good underlying bill. We are going to
have a very healthy debate about it today. And I would urge my
colleagues, on behalf of American workers, that we have a
responsibility to pass this bill now.
Is it perfect? I am sure it is not, but I do believe when this bill
passes here today with bipartisan support, we will get to a conference
with the Senate where we will hammer out the differences between the
House and Senate bill. But the longer this House waits to move this
bill, the longer we make arguments, that we make perfect the enemy of
the good, the more we are jeopardizing the retirement security of
American workers. And I believe that we have to act now, get ourselves
to conference, and get a bill passed that brings comprehensive reform
to our pension laws.

{time} 1130

Mr. HASTINGS of Washington. Mr. Speaker, I yield myself such time as
I may consume.
Mr. Speaker, this debate has been on the rule to deal with a very
important bill that has been talked about on both sides that needs to
be addressed. I would just simply point out that there will be a motion
to recommit, which has always been part of what the Republican majority
has suggested on every major piece of legislation since we have been in
control.
Mr. Speaker, I yield back the balance of my time, and I move the
previous question on the resolution.
The previous question was ordered.
The SPEAKER pro tempore (Mr. Aderholt). The question is on the
resolution.
The question was taken; and the Speaker pro tempore announced that
the ayes appeared to have it.
Mr. McGOVERN. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the

[[Page H11670]]

Chair's prior announcement, further proceedings on this question will
be postponed.

____________________