[Congressional Record Volume 152, Number 29 (Wednesday, March 8, 2006)]
[House]
[Pages H722-H727]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
APPOINTMENT OF CONFEREES ON H.R. 2830, PENSION PROTECTION ACT OF 2005
Mr. McKEON. Mr. Speaker, I ask unanimous consent to take from the
Speaker's table 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, with a Senate
amendment thereto, disagree to the Senate amendment, and agree to the
conference asked by the Senate.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from California?
There was no objection.
Motion to Instruct Offered by Mr. George Miller of California
Mr. GEORGE MILLER of California. Mr. Speaker, I offer a motion to
instruct conferees.
The Clerk read as follows:
Mr. George Miller of California moves that the managers on
the part of the House at the conference on the disagreeing
votes of the two Houses on the Senate amendment to the bill
H.R. 2830 be instructed--
(1) to agree to the provisions contained in section 403 of
the Senate amendment (relating to special funding rules for
plans maintained by commercial airlines that are amended to
cease future benefit accruals) and section 413 of the Senate
amendment (relating to plan benefits guaranteed when
regulations prescribed by the Federal Aviation Administration
require an individual to separate from service after
attaining any age before 65);
(2) to insist on the provisions contained in section 907 of
the bill as passed the House (relating to direct payment of
tax refunds to individual retirement plans);
(3) to insist on the provisions contained in section 902 of
the bill as passed the House (relating to making the saver's
credit permanent); and
(4) to insist on a conference report that imposes the
smallest additional funding requirements (permitted within
the scope of conference) on companies that sponsor pension
plans if there is no reasonable likelihood the termination of
the plan would impose additional liabilities to the Pension
Benefit Guaranty Corporation or there is no reasonable
likelihood the plan sponsor would terminate the plan in
bankruptcy.
{time} 1330
The SPEAKER pro tempore (Mr. Terry). Pursuant to clause 7 of rule
XXII, the gentleman from California (Mr. George Miller) and the
gentleman from California (Mr. McKeon) each will control 30 minutes.
Mr. McKEON. Mr. Speaker, I reserve all points of order against the
motion.
[[Page H723]]
The SPEAKER pro tempore. A point of order is reserved.
The Chair recognizes the gentleman from California.
(Mr. GEORGE MILLER of California asked and was given permission to
revise and extend his remarks.)
Mr. GEORGE MILLER of California. Mr. Speaker, I yield myself 5
minutes.
Mr. Speaker, Members of the House, we offer this motion to instruct,
because today, all across America, employees are worried sick about
their retirement nest egg. They have seen big airlines like USAir and
United cut and run on their obligations to pay the promised pension
benefits and are wondering if they are next. They have seen major
companies like Verizon, IBM, Motorola, Northwest, Delta, Sears Roebuck
Company, Alcoa, Hewlett Packard, Lockheed Martin freeze their plans. We
just read that General Motors will close its defined benefit plan to
new management hires and give them a 401(k) instead. These are
devastating developments that need urgent action by this Congress.
Unfortunately, this House bill makes none of these provisions better.
In fact, it may make some of them worse. This motion addresses two
urgent issues. First, it provides needed help to the airline pension
plans hurt by 9/11 and skyrocketing fuel prices from terminating. It
would be devastating to hundreds of thousands of workers across this
Nation if more airlines were permitted to dump their plans into the
PBGC. When this happens, the big losers are the employees.
Look at the pilots of United, for example. They had a vested pension
benefit cut in half. The average pilot lost $1,270. Here is what you
see what happens when an airline or any employer is allowed to simply
dump the plan into the Pension Benefit Guaranty Corporation, the
government body that is set up to protect pensions. You see here that
the pilots, 14,000 pilots, and 6,000 of them were retirees who lost 50
percent of their benefits, they lost $1,370 a month for the rest of
their lives, for the rest of their lives. Management, employees and
ticket sellers and others; 42,000 of them, 12,000 retirees lost $221
for the rest of their lives as did the machinists and the ground crews,
who lost $493. That is because the company made essentially a
unilateral decision simply to dump this plan without justification into
the PBGC.
There are other actions that could be taken. The reason that we are
here today is because a number of airlines have said, let us see if we
can work with our employees if we can stretch out these plans, if we
can keep from terminating them. We can work through these difficult
times for the airline industry, that there may be a way to do this and
get away from the tragedy that happened to these retirees and to their
families.
Let us just be very clear about this. These are not 401(k)
investments that went wrong in a bad market, these pension plans that
were dumped into the PBGC. They were rock solid pension benefits that
were stripped away from these employees and retirees for the
convenience of United executives and shareholders.
While these employees, the pilots, flight attendants, machinists and
others, were losing millions of promised benefits, the majority party
in this Congress didn't fight for them, didn't lift a finger for them,
didn't even offer a fair hearing to the people who were going to be
most impacted by the decisions by people like United. This is a
national disgrace.
This motion accepts the Senate provision that gives these airlines
the ability to keep their plans going while stretching out payments.
Freezing plans is a lot better than terminating. Go ask the ticket
agents, the pilots and the mechanics at United whether they would have
rather had their pension plan frozen while the airline worked through
its difficulty, or whether they would have it terminated.
The motion would also support the Senate provision to provide full
Pension Guaranty Corporation retirement protection up to the maximum
guaranteed amount, about $47,000, by the Federal Government, for those
pilots who are required by the Federal Government to retire at age 60.
This was a double hit to these pilots. The Federal law said they had to
retire at age 60, and then the Pension Benefit Guaranty Corporation
told them, because you had early retirement at age 60, you are going to
lose even more of your pension every year. We should protect those
pilots. They had no way to protect themselves.
This motion also makes it clear that the bill's onerous funding
requirements do not apply to companies that pose no risk of termination
or liability to the Pension Benefit Guaranty Corporation. Forcing
healthy plans out of the system does not make our pension system more
secure, it makes it less secure. The House bill as written will give a
financial hit to company pension plans that do not face the risk of
termination and don't threaten the solvency of the Pension Benefit
Guaranty Corporation.
Finally, this motion supports the commonsense provision that will
encourage savings through the savings credit to allow people to deposit
a portion of their tax refunds into savings accounts. Let us keep these
airline plans going so hundreds of thousands of employees at Delta,
Continental, Northwest Airlines are not put in the same position as the
employees of United, and I urge the Members to support this motion to
instruct.
Mr. Speaker, I reserve the balance of my time.
Mr. McKEON. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, let us be clear this motion to construct is nothing less
than an attempt to undermine bipartisan efforts on the pension reform.
The Democrat motion to instruct is hypocrisy at the highest level. They
want these plans to be well funded, as we all do, yet want to mask the
health of pension plans and make them look better funded than they
really are. The result will be status quo. Plans will continue to
freeze or terminate, and employees will continue to lose their hard-
earned benefits.
I would like to point to a colloquy between the majority leader and
the gentleman from Georgia, (Mr. Price) on the floor on December 15 of
2005. During the colloquy, the majority leader pledged to work on a
responsible and appropriate solution to addressing the airline pension
issue in conference, which is what we plan on doing. The time has
arrived, and we are about to debate the Senate airlines provision on
the merits.
The Democrat motion to instruct is an attempt to undermine the
conference process and should be seen as nothing more than an effort to
weaken and, in fact, derail pension reform. Again, an examination of
legacy airline relief is appropriate in conference, which we will do.
Examining the process is the Democrats' attempt to end run around the
rules for their benefit. I urge you to reject the motion to instruct
and let us get our work done.
Mr. Speaker, I reserve the balance of my time.
Mr. GEORGE MILLER of California. Mr. Speaker, I yield 3 minutes to
the gentleman from Maryland (Mr. Cardin) of Ways and Means.
Mr. CARDIN. Mr. Speaker, let me thank Mr. Miller for yielding this
time.
Mr. Speaker, we do need pension legislation. We need pension
legislation that will protect the worker, that will reform the PBGC,
the guaranty fund, and will encourage companies to maintain and
strengthen their pension plans. The Miller motion to instruct
encourages us to be able to accomplish those goals.
Mr. Miller has already talked about the provisions related to the
airline industry that is very, very important. He mentioned the fact
that we have to help younger workers and lower-wage workers by the
refundability, by the savers credit, making permanent, and by dealing
with split refunds of taxes.
Let me deal with one provision that Mr. Miller covered very quickly,
which I think is important, that is, encouraging companies to continue
their defined benefit pension plans. If we put more and more burdens on
companies that are well funded, that are in no danger of going into
bankruptcy, these companies are going to freeze their plans, they are
going to terminate their plans. Why would they stay around in the
defined benefit world if we put more and more restrictions and more
onerous funding rules that are unnecessary?
The Miller motion is commonsense and asking us to be very careful on
new
[[Page H724]]
requirements that we place on plans that are properly funded, plans
that present no danger to the guaranteed fund. We are in danger of
losing more and more defined benefit plans which are well managed,
where the employees are guaranteed a certain annuity payment, and we
don't want our legislation to be responsible for the termination of
more plans.
I would urge my colleagues to support this motion. I would urge my
colleagues to make sure that in the pension legislation that comes out
of conference, that we have legislation that, yes, we will protect our
workers, and, yes, we will protect the guaranteed fund, but we will
also make it easier for companies to maintain and expand pension plans
for their employees. That is the best way that we can help provide
security for all Americans on their retirement. I urge my colleagues to
support the motion.
The SPEAKER pro tempore. Does the gentleman from California continue
to reserve his point of order?
Mr. McKEON. I continue to reserve that point of order.
Mr. Speaker, I now yield such time as he may consume to our
subcommittee chairman of the Employee-Employer Relations Subcommittee,
the distinguished gentleman from Texas (Mr. Sam Johnson).
Mr. SAM JOHNSON of Texas. Mr. Speaker, I rise in opposition to the
Democratic motion to instruct conferees. You know, I voted for a bill
that will strengthen pension plan funding. I want pension plans to have
the right amount of money to pay benefits as promised. It is crazy to
require overfunding, but it is also crazy to allow more time for them
to recover. I mean, if, in fact, those plans were well managed, as the
gentleman just said, we wouldn't be in this fix we are in.
Too many companies make bigger promises than they can pay for, and
they dump their underfunded pension plans on the PBGC. We are facing an
ocean of red ink at the PBGC, and we need to be sure that companies put
their money where their mouth is.
I think that since we marked up our bill, we have heard from many
sources that some of the bill needs to be modified in conference. We
need to go to conference without restrictions. We need to be able to
negotiate with our colleagues from the Senate to get a great bill
signed into law. This Democrat motion would weaken the House bill, and
I can't support pretending that plans aren't healthy.
We need to be very clear with the pension plan sponsors and employees
who are expecting benefits out of these plans there needs to be
adequate funding to make good on the private promises. Unfortunately,
fewer Americans every year are lucky enough to have one of these
defined benefit plans. We are backed up by the Federal Government.
We need to strike the right balance in pension funding rules so that
the correct amount of money is there to pay benefits. The House bill is
pretty close to the right answer. We should oppose the Democrat motion
to undermine the good work of this House that was passed by a vote of
294 Members, and let us work with the Senate for a great bill.
Mr. McKEON. Mr. Speaker, I withdraw my reservation of the point of
order.
The SPEAKER pro tempore. The reservation is withdrawn.
Mr. GEORGE MILLER of California. Mr. Speaker, I recognize the
gentleman from Massachusetts (Mr. Tierney) for 3 minutes.
Mr. TIERNEY. Mr. Speaker, this is yet another example of the
government under this majority in the House, and the Senate and the
Republican White House of failing to live up to its role to protect the
American people from circumstances beyond their control.
We have troops over in Afghanistan and Iraq that are not protected in
the manner in which they should be protected. We have people down in
Louisiana and Mississippi and other areas affected by the storm,
Katrina, who are not getting the attention and the protection that they
deserve and their situation warrants.
Here we have a failure of the government to step forward and to
protect the American working family, who has paid into pension funds,
expected them to be protected, expected something to be there after 20,
25 or 30 years of work and contributing to these funds, only to find
out that management people, CEOs, walk into bankruptcy court and
somehow wipe out the workers' interest while they end up with golden
parachutes and protection for benefits once they come out of
bankruptcy.
Mr. Speaker, Mr. Miller and I and others have been fighting this
issue for the working people for some time. In committee we offered an
amendment that would allow the Pension Benefit Guaranty Corporation,
that corporation, an entity which would protect workers. We wanted that
to intervene earlier to be able to work with companies to make sure
that they first exhausted all of their possible remedies by permitting
them to terminate plans and go into bankruptcy only after they had done
that.
We presented a substitute for this bill, but we weren't allowed to
have a vote on it. Our colleagues in the majority, I think, speculate
or were afraid that Members of their party would have joined in this
motion, because it would have improved the bill. Companies should first
have to exhaust every possible remedy to create financing and be
creative in order to save and restore pensions before they are allowed
to go into bankruptcy court and wipe them out while enhancing the
position of the CEOs and other management people.
{time} 1345
We are fighting here, Mr. Speaker, to protect the retirement security
of American families. We are protecting benefits of airline employees
and seeking to encourage retirement savings.
Both the Congressional Budget Office and the Pension Benefit Guaranty
Corporation say that H.R. 2830 would actually add to the Pension
Benefit Guaranty Corporation's deficit. They say the bill would
actually chase companies out of the defined benefit system, that
traditional benefit system that people have come to rely on, and it
would leave workers with fewer choices actually than the plans for
retirement that they have now.
This motion to instruct conferees would at least address some of
those issues, Mr. Speaker. It would protect the pension benefits of
airline employees by asking to support the Senate provision, to keep
American and Continental and Delta and Northwest from terminating their
plans at the expense of employees and taxpayers, giving them additional
time to actually work on their plans.
It would support the Senate provision to provide full Pension Benefit
Guaranty Corporation retirement protections for pilots that are forced
to retire at age 60. As Mr. Miller says, they are getting a double-
whammy now, and they should not have to face that situation.
The motion would also make permanent the Saver Tax Credit, urging
conferees to accept the House provision for the credit that provides a
matching contribution for low- and moderate-income workers, and make
sure that that provision, which is used now by 5.3 million people both
in 2002 and 2003, to continue on, and support the House provisions to
split the tax refund for automatic forwarding to a retirement account
and to provide for the protection of traditional plans, dropping new
funding provisions in either the House or Senate bill that would
encourage companies to terminate or freeze.
Mr. Speaker, all those things are necessary to improve this bill, and
I ask for support for the Miller amendment.
Mr. McKEON. Mr. Speaker, I yield such time as he may consume to the
subcommittee chairman of Select Revenue from the Ways and Means
Committee, the gentleman from Michigan (Mr. Camp).
Mr. CAMP of Michigan. Mr. Speaker, I thank the chairman for yielding,
and I rise to oppose this Democrat motion.
This motion takes some parts of our tax agenda and says they are
important, like the savers credit, the direct payments of tax refunds
to IRAs, but ignores so many other parts of our bill that are critical,
like the permanency of the pension and IRA provisions, many of which
were in the Portman-Cardin legislation which this House has debated
long before, I noticed Mr. Cardin was here earlier, and long-term care
insurance, which is a critical issue, and FSA rollover, which many of
my friends on the other side are vitally interested in as well. So this
motion to instruct is really incomplete, and I
[[Page H725]]
would urge all Members to vote against it.
With regard to airlines, I am vitally interested in the viability of
our airline industry and certainly their ability to provide pensions
for their employees. But I think to simply accept the Senate language
would not allow us to go to conference and deal with the airline issues
in a comprehensive and thorough way in conference.
So I would urge Members, especially those Members interested in the
airline issue, to oppose this motion to instruct.
Mr. GEORGE MILLER of California. Mr. Speaker, I yield 3 minutes to
the gentleman from New Jersey (Mr. Andrews), a member of the committee.
(Mr. ANDREWS asked and was given permission to revise and extend his
remarks.)
Mr. ANDREWS. Mr. Speaker, I thank my friend for yielding, and I rise
in support of this motion.
This motion asks the Members three questions. The first question is
whether we should take the position that before airline pension plans
of companies that are in real trouble terminate their pension plans,
whether those companies should be required to take every reasonable
step prior to that termination; whether we should be able to put those
companies in a position where they can stretch out their payments to
the pension plan, look for other ways they can fund the pension plan,
and meet their pension obligations to their retirees.
I would suggest, Mr. Speaker, the answer is yes, we should require
that the law do that, which is why this motion takes the right course.
The second question that this motion asks is with respect to healthy
pension plans. Should it be the principles of the new law that we
should operate with care and avoid new funding requirements on these
healthy pension plans which are more likely to push them into disrepair
and trouble?
I would suggest that the answer is yes, we should. The guiding
principle, as the conference proceeds in writing this new law, should
be to first do no harm to the healthy defined benefit plans that exist.
So I think this motion correctly answers that question and follows the
right path.
Finally, this motion raises the question as to whether we should
permanently enshrine in the law the savers credit. The savers credit
has been used by more than 5 million Americans in recent years. These
are Americans who wait on tables, fix engines, work in child care
centers, who have managed to squeeze out just a little bit of what is
left out of their paycheck to put it away into a retirement plan.
Wisely, Uncle Sam matches a part of that small savings from that worker
to try to encourage more people to do that. This is good for those
families, it is good for the country's economy, it is good for the
Social Security system.
That credit is due to expire at the end of 2008. This resolution
raises the question as to whether we should let that credit expire. We
think the answer is no, we shouldn't let that credit expire, it should
be permanently enshrined into law.
So I think those are three eminently reasonable propositions. We
should encourage airlines not to terminate their plans if there is a
reasonable and viable alternative; we should go to well-funded healthy
plans and do no harm to them as we write new rules about funding
pension plans; and, finally, we should take this very useful provision,
supported by both the Republican and Democratic parties, that more than
5 million Americans have used, and keep it in the law.
For these reasons, I would urge my colleagues to vote ``yes'' on the
Miller motion.
Mr. McKEON. Mr. Speaker, I yield such time as he may consume to the
chairman of the Ways and Means Committee, the gentleman from California
(Mr. Thomas).
(Mr. THOMAS asked and was given permission to revise and extend his
remarks.)
Mr. THOMAS. Mr. Speaker, I would feel a whole lot better about this
debate if it were being carried out in October or November and we had a
chance to actually make some permanent changes in pension law prior to
the first of the year. We are now in March. Frankly, we have been very
lucky that the real world hasn't reacted in a way that would make our
job even that much more difficult.
The gentleman from New Jersey, in his usually scholarly fashion, has
laid out what we ought to do. I would like to remind the gentleman that
the House bill contains the Savers Credit. We put it in. We obviously
support the Savers Credit. Why there is a need now to reaffirm the fact
that we support the Savers Credit is beyond me. The House has voted for
it. It is the House position. Do you need to then put another nail in
it?
But, interestingly, you only mentioned that. You didn't mention the
other really good provisions that are in there. I think they all should
be given equal weight and we should support it.
In terms of the airlines, the House bill is silent on airlines. I
think that is, frankly, the smartest position we should be in. Do you
think that based upon the conferee, the gentleman from Michigan's
statement, that we aren't vitally concerned about airlines? I think
what we ought not to do is to begin drawing lines in the sand. And, by
the way, they aren't even lines in the sand, because this particular
bill has no bearing of any meaning to the conferees. It is basically a
political statement on the part of the minority in which they wish to
select certain provisions and highlight those over others.
You have every right to offer it, we have every responsibility to
reject it, because it means then other provisions that you chose not to
pick, which you were not successful on, should not be dealt with in
conference, and that isn't the way the world works. The majority will
carry forward, not just the Savers Credit, but the other good
components in the bill.
You can be assured that we are very, very concerned about airlines.
We are so concerned that we didn't spend time spinning our wheels on
the floor trying to determine who should be rewarded and who should
not. We are going in there with total flexibility to try to solve the
problem, and we will do the best we can to address the problem.
I will just have to tell you that to the degree we play political
games, as indicated by the gentleman from Massachusetts' speech in
terms of class warfare, once again we may run the chance of failing in
the conference. We cannot afford that chance. And if we are successful
in conference, we are going to have to convince the administration to
sign the bill.
This is the time to be prudent, to turn down that wick of partisan
rhetoric, get serious about trying to begin to solve an institutional,
demographic, and economic structural problem. I want to go to
conference with maximum flexibility in taking the House position and
solving the other problems that need to be solved.
Please. You have every right to offer it. We should reject it. Let us
get on to the conference so we are dealing with real issues instead of
imagined political ones that continue to seem to be the primary
motivation of the minority party in this House.
Mr. GEORGE MILLER of California. Mr. Speaker, I yield 3 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, contrary to what the chairman said, this
isn't games playing. This is not partisanship. This is a plea for
serious attention to a real problem on a bipartisan basis.
Yesterday, General Motors announced that it will freeze its
guaranteed benefit pension plan for salaried employees and replace it
with a defined contribution plan in which employees take the risk.
This is what we are saying in part four of our motion: If the
conferees follow the direction set by the current House and Senate
pension bills, there will be far more announcements like GM's in the
future.
The changes in both the House and Senate bills would dramatically
increase the chances of companies having to make large, unexpected
contributions by making pension funding more volatile, the risk that
GM, struggling with manufacturing challenges the U.S. Government has
failed to consider, decided it could not afford.
It would mean companies facing challenges even less serious than
General Motors' will make the same decision GM did. In a survey, 60
percent of
[[Page H726]]
chief investment officers for large pension plans said that changes
like those in the House and Senate bills would lead them to cut
benefits or freeze or terminate their pension plans. Despite our
repeated requests, the administration has failed to tell us how their
proposals would affect specific industries.
Our motion includes a critical provision instructing conferees to
drop those provisions which would encourage healthy companies to freeze
or terminate their pension plans. Those provisions include the shift to
a yield curve, take away what is called smoothing, classifying
companies as at-risk based on credit ratings, as in the Senate bill,
and provisions regarding advanced funding.
Look, we are putting our motion forward for a simple reason: If your
goal is to force employees to terminate their pension plans, leaving
their workers on their own to face a risky and uncertain future, vote
against the motion. But if your goal is to preserve the defined benefit
pension system for workers, as well as the continued competitiveness of
the companies they work for, do in fact vote for this motion to
instruct.
Mr. GEORGE MILLER of California. Mr. Speaker, I yield 4 minutes to
the gentleman from Ohio (Mr. Kucinich).
(Mr. KUCINICH asked and was given permission to revise and extend his
remarks.)
{time} 1400
Mr. KUCINICH. Mr. Speaker, I have heard from hundreds of workers
about H.R. 2830. Over 400 UAW members called my office to express their
concerns about 2830 as it has been reported out of committee.
I was not alone in hearing from concerned workers. Workers from
across America called congressional offices and asked for protection
for their pension benefits.
Now, my vote in favor of the Pension Protection Act in December was
cast to codify the improvements negotiated by auto workers and to
enable the steel workers to press for further improvements in the
conference committee. I have some hope there is a process for making
additional improvements. But my vote was conditioned on the expectation
that the bill would be substantially improved in the conference
committee. I will need to see significant further improvements before
voting again.
There are still some serious problems with H.R. 2830, and these
problems must be addressed to ensure that all workers' pensions are
protected. One such problem, which I hope will be fixed in the
conference committee, concerns the rules affecting plant shutdown
benefits for companies with small numbers of facilities.
The rules are biased against such companies, which will be faced with
onerous funding requirements in the event of the shutdown of a
facility. The workers, of course, would be the ultimate bearers of the
burden, since older workers would lose the shutdown benefits that
enable them to fully vest in the event of a plant shutdown.
Mr. Speaker, I encourage the conferees to adopt further shutdown
benefit reforms. Conferees must also address the issue of cash balance
plans. This bill does a great disservice to older workers by denying
the reality that conversions from traditional defined benefit plans to
cash balance plans harm older workers.
A report released in early November by the GAO found that a majority
of older workers experienced deep cuts in their pension when converted
from a traditional plan to a cash balance plan, without transition
protection. This is not only unfair, it is wrong. Providing transition
protection for older workers should not be a choice for employers, but
a requirement, and any change in the plans must protect the accrued
benefits of employees, and the conference report should reflect that
reality.
Finally, I strongly support a provision to help airlines avoid
terminating their pension plans by giving them additional time to fund
their workers' plans. Section 403 of Senate bill 1783 will give
airlines the time they need to meet their pension obligations, and that
is a good provision, and we ought to support that. You know, then there
will not be any bankruptcy movements because of pensions. There will
not be any dumping of pension obligations on the PBGC, and there will
not be any jettisoning of obligations to workers who have worked a
lifetime and expect their pension benefits. And that kind of a
provision will serve the workers and the American taxpayers.
I want to say that we have an obligation here of the American
retirees to support full PBGC retirement protection for pilots who are
forced to retire at age 60. Workers should not be punished for retiring
at the age of 60 when safety regulations require them to stop flying.
The American people are waiting to see if we care for those who have
put in their time. They deserve their security.
This Congress has an obligation to America's retirees. We see
corporations all over the country trying to throw their obligations
onto the Pension Benefit Guaranty Corporation, but when we have some
companies that are trying to do the right thing, as we do with the
Senate provision that recognizes that American Airlines is trying to do
the right thing, then we should provide them with the help that they
need to meet their pension obligations.
This is a moment of truth for this Congress. Are we going to be true
to our commitment to the American workers? Are we going to say to
people who worked a lifetime, deserve the commitment that corporations
made to them, that they are going to get the pension that they spent
their lifetime for?
There are a lot of people who are watching this debate, asking if
Congress is going to do the right thing. I strongly support Mr.
Miller's work here, and I hope this Congress will agree with this
legislation.
Mr. GEORGE MILLER of California. Mr. Speaker, I yield 3 minutes to
the gentleman from North Dakota (Mr. Pomeroy), a member of the Ways and
Means Committee.
Mr. POMEROY. Mr. Speaker, pensions are being frozen every day.
Workers are having their retirement benefits reduced, yet the
administration supports proposals which will dramatically accelerate
the freezing of pensions.
When I asked the Department of Labor how many pensions will be frozen
as a result of their proposals, they could not answer. They said they
had not even modeled or considered the implication.
Well, the CFOs of the Nation have considered it, and a gathering of
them have said these proposals will have long-term consequences for
current and future workers, with the potential to damage the retirement
security of millions of Americans. Indeed this same group estimates 60
percent of existing pension plans may be frozen. That is what this
looks like on a chart: 29,700 pension plans in force, 17,800 of them to
be frozen under the 60 percent proposal. The administration has not
considered it.
That is why the motion to recommit is so important. We say that fully
funded pension plans should not face dramatically severe additional
funding requirements, they are already fully funded. Why would you want
to punish employers who have funded pension plans? One very clear
reason: to end pensions. And that is really what is at stake. They want
to move from a defined benefit pension guarantee to defined
contribution 401(k)s. It is as simple as that.
We should resist that. Pensions ensure that the risk of participating
is universal. The workers participate. They ensure that the risk of
investing is handled collectively. They ensure that you are not going
to outlive your assets in retirement. That is what pensions provide.
That is why we should be able to agree on a bipartisan basis to
continue these pensions.
But yet just last week at the Nation's Savers Summit, I heard a
committee chairman say he prefers the 401(k) to pensions. Why, he was
asked? Because it is part of the ownership society.
Oh, we get it. You own your risk. You own your risk of investing
appropriately. And you own the risk that you are not going to outlive
the assets as you live on to retirement years.
We ought to be doing everything we can to keep workers' pensions. We
all ought to feel some failure when we read, like today's headlines, GM
to cut retirement costs, following, as the article notes, not just
troubled companies, but healthy as well. Verizon, IBM, Motorola, the
trend continues and will be
[[Page H727]]
accelerated dramatically by this bill which seeks to push all of the
Nation's pension plans into termination in favor of 401(k)s.
Pass this motion to recommit.
Mr. GEORGE MILLER of California. Mr. Speaker, I have no further
requests for speakers. I believe I have the right to close. Is that
correct?
The SPEAKER pro tempore (Mr. Terry). The gentleman is correct.
Mr. McKEON. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, we have no further speakers either. You know, it has
been decades since we have had real, meaningful pension reform. And we
could sit here and we could talk. It kind of reminds me of fiddling
while Rome burned.
I think the time to move is now. We passed the bill with 294 Members
of our House voting for it. Now it is time to go to conference, meet
with the other body, get this resolved so we can help all of these
people that we are all talking about.
I would ask that my colleagues reject this motion to instruct, and we
get on with the business of the conference.
Mr. Speaker, I yield back the balance of my time.
Mr. GEORGE MILLER of California. I yield myself such time as I may
consume.
Mr. Speaker, Members, this is a very straightforward proposition.
This is about whether or not this House of Representatives will go on
record to try and give the airlines the ability, the time, and the
means by which they may treat their employees better by holding onto
their current pension plans; whether they freeze them or they take some
other action in conjunction with their employees so that their
employees will not be thrown for the loss that the United employees saw
when that company decided that it would use the PBGC, the Pension
Benefit Guaranty Corporation, just as a convenient tool to discharge in
bankruptcy those employees' pension plans that devastated those
employees, the United employees, and devastated their families.
Why are we doing this on this legislation? Because it is very
interesting, through the course of this legislation during the
consideration in the committee and on the floor, we could never quite
get a vote on airlines. Now we are going into a conference committee,
and the Republicans say, oh, everything is going to be just fine. And
yet we know that already this conference committee is starting to
attract attention, that this may be a vehicle for other measures that
are unable to move in this Congress.
And so we do not know what is going to be in play. So we wanted to
make sure that the Members of the House have the opportunity to say
that these airlines ought to be able to try and work this out.
The other factor is that time is running against these airlines. They
are going to have to declare and make a decision relatively soon.
We do not know if this conference is going to be committed. So it is
just a question for the Members, do you or do you not want to be able
to be on record to suggest that this would be better treatment for
these employees, hopefully for these companies, than what happened
under the United pension plan.
You saw what Mr. Pomeroy said: many, many business executives, people
involved in the pension business, have looked at this bill, and they
have said that this bill is going to make it more difficult, make it
more costly and probably lead to additional terminations.
The Pension Benefit Guaranty Corporation, the people that handle this
problem when all else fails, told us this is worse than current law.
Now, you can ride that animal if you want, but you may also, if you are
deeply concerned about the airline employees in your area, you may also
want to vote for this motion to instruct so we send a clear message to
the House conferees and the committee, have refused to have this vote
at any stage of the process, that we be allowed to have a vote, and
that we support the effort of having the airlines be able to work this
provision out.
That is what this motion to instruct does. It is important. It is
important to the airlines. It is important to the employees. It is
important to their families. It is important to how we look at solving
this difficult problem of holding onto people's retirement nest eggs
and to the pension plans that they are currently in.
This is presented as some great pension reform. It really does little
or nothing to forestall the trend that we now see developing in terms
of the termination of pension plans and people losing their retirement
nest eggs.
Mr. Speaker, I would urge the House to support the motion to
instruct.
The SPEAKER pro tempore. Without objection, the previous question is
ordered on the motion to instruct.
There was no objection.
The SPEAKER pro tempore. The question is on the motion to instruct
offered by the gentleman from California (Mr. George Miller).
The question was taken; and the Speaker pro tempore announced that
the noes appeared to have it.
Mr. GEORGE MILLER of California. 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, further
proceedings on this question will be postponed.
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