[Congressional Record (Bound Edition), Volume 152 (2006), Part 4]
[House]
[Pages 5434-5441]
[From the U.S. Government Publishing Office, www.gpo.gov]




 MOTION TO INSTRUCT CONFEREES ON H.R. 2830, PENSION PROTECTION ACT OF 
                                  2005

  Mr. GEORGE MILLER of California. Mr. Speaker, I offer a motion to 
instruct.
  The SPEAKER pro tempore. The Clerk will report the motion.
  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 to agree to the provisions contained 
     in the Senate amendment regarding the prohibition of wearaway 
     in connection with conversions to cash balance plans and the 
     establishment of procedures affecting participants' benefits 
     in connection with the conversion to such plans and not to 
     agree to the provisions contained in title VII of the bill as 
     passed the House.

  The SPEAKER pro tempore. 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.
  The Chair recognizes the gentleman from California (Mr. George 
Miller).
  Mr. GEORGE MILLER of California. Mr. Speaker, I yield myself 7 
minutes.
  Mr. Speaker, I offer a motion to instruct conferees on H.R. 2830, the 
Pension Protection Act. The Senate appointed conferees on March 3 and 
the House on March 8, and yet 1 month later it appears almost no 
progress has been made. In fact, I actually would say that the 
conference seems to have gone backwards. Senator Enzi, the conference 
chair, promised that there would be an open and bipartisan conference; 
Mr. Leader Boehner promised the same. Instead, both meetings have been 
held in secret by a small group of Republican conferees.
  There are a lot of important issues pending in the pension 
conference. Every day employers are dumping their pension plans and 
millions of workers are deeply worried about their retirement security 
and whether or not they will have sufficient funds for their retirement 
to support their families. One of the key issues pending in the 
conference is whether or not older workers will be protected when 
employers convert their traditional defined benefit plans to a so-
called cash balance plan. It is a critical issue for millions of 
American workers, and it is not a new issue to this House.
  During the 1990s, hundreds of large employers switched to these cash 
balance plans, including IBM, whose conversion was ruled illegal. As 
many as 8 million workers have been affected by these conversions, many 
of them, perhaps half of them, experienced deep cuts in their pension 
benefits as a result of these conversions.
  Let's be clear. Companies promised these benefits to these workers. 
These workers earned these benefits. Then with some paperwork and a 
little fancy

[[Page 5435]]

accounting footwork, companies slashed the benefits of these workers. 
How did the companies do it? First, the benefits of the traditional 
pension plan are based upon the worker's pay at the end of their 
careers and when they are earning the most. Cash balance plans, on the 
other hand, are based on worker's average pay over the course of their 
career.
  With just a simple change on how benefits are calculated, companies 
can devastate the retirement nest eggs of hard-working employees, 
workers who gave up wages, who gave up vacation days, who gave up all 
kinds of benefits as they balanced out their pension plans. Yet we now 
see companies unilaterally essentially destroying the pension benefits 
that those workers are entitled to.
  Older workers under these conversions can lose up to half, half of 
their expected retirement benefits. Don't take my word for it. That is 
according to the Government Accountability Office. They tell us that 
that is what happens to older workers. This chart shows exactly what 
happens. This is what would happen to the workers who went into the 
workforce at age 25 and worked for a company. They would see their 
traditional retirement benefits continue to go up. With a cash balance 
plan, the retirement benefits go down.
  For the older workers, this is what they stand to lose. For anyone 
over about the age of 46, 47 years old, they have a substantial change 
in the pension benefit that they were counting on. Obviously, for these 
workers out here, at age 55, it is very difficult, if not impossible, 
to see how they would recover a sufficient amount of savings to provide 
for the retirement that they were planning on at that time.
  And it gets worse if you are 60 years old. So anybody after 45 years 
of age is greatly disadvantaged under these plans. And that is what is 
going on in the pension conference committee, is whether or not we will 
have the opportunity to provide for those older workers.
  What we now see is that IBM did this and the court stopped those 
conversions in 1999. The House voted overwhelmingly on several 
occasions in support of amendments urging the protection of older 
workers. The Bush administration first tried to lift the moratorium and 
legalize these conversions. But after 218 Members of the House or the 
Congress urged the President to reconsider, he withdrew that proposal. 
The Bush administration changed its position and has submitted 
proposals that do more to help the older workers.
  As part of the pension funding reform legislative debate, Senators 
Baucus, Kennedy, Frist, Grassley, Hatch and Lott brokered a compromise. 
The compromise largely follows the Bush administration proposal and was 
passed by the Senate 97-2. This motion to instruct that I am offering 
today urges the conferees to support the Senate compromise on 
protecting older workers in the cash balance conversion.
  The House-passed bill contains no protection for older workers and 
would actually legalize some of the worst employer practices that 
jeopardizes worker retirement security and their retirement nest eggs.
  The AARP, the AFL-CIO, the National Committee to Preserve Social 
Security and Medicare, the National Legislative Retirees Network, and 
the Pension Rights Center all support this motion. The AARP opposes any 
pension funding reform bill that does not protect older workers 
affected by these cash balance conversions.
  The House of Representatives has already voted three times to require 
the Treasury Department to protect older workers from age 
discrimination in cash balance conversions. In 2002, the amendment 
passed by a vote of 308-121; in 2003, it passed 258-160; and in 2004, 
it passed 237-162. Mr. Speaker, obviously this House has recognized the 
unfairness of the cash balance plans to older workers and that older 
workers ought to be protected.
  We believe that older workers ought to be given a choice. That is 
what the Congress did when it changed its pension plan. That is what 
Secretary of Commerce Snow said that he did when he was running his 
company, when he sat on the board of other companies, because he said 
that was the fair thing to do. The Bush administration has come around 
to that position. The only place where we don't hold that position is 
under the Republican-passed bill on the pensions that is now in the 
conference committee.
  That is why this motion to instruct is important, so that we can make 
sure that, at a minimum, we can exit that conference committee with the 
Senate-passed provisions that passed 97-2 to help protect, not perfect, 
but to help protect older workers who are subject to these dramatic 
changes by their employers, and who have very little opportunity to 
recover that nest egg of retirement benefits that they were counting 
on, that they worked hard to earn, that they negotiated with their 
employers and now simply, by a unilateral action, are ripped away from 
them.
  It is not fair, it is not ethical, it is not right, and this Congress 
ought to stand up and change it to protect those older workers. I urge 
my colleagues to support the 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, hybrid pension plans represent an important component of 
worker retirement security. In fact, more than 9 million workers today 
rely on these benefits for a safe retirement. Unfortunately, some 
continue to paint a misleading picture about these pension plans.
  Despite these claims, hybrid plans actually provide more generous 
benefits for the majority of workers than do traditional plans.

                              {time}  1745

  These conclusions emerge from a growing body of independent research 
by economists and academics at some of the Nation's most respected 
institutions, including the Federal Reserve Board, the Urban Institute, 
the Brookings Institution, and the Wharton School of Business.
  Not only are hybrid plans especially advantageous for women and 
lower-paid workers, but they also comprise the only part of the defined 
benefit system that is growing. Hybrid plans now provide the PBGC with 
approximately 25 percent of its premium income. And because the total 
number of defined benefit plans has declined significantly over the 
last 20 years, it is now more important than ever to encourage 
employers to stay in the defined benefit system and offer these 
benefits.
  The threat of liability is creating ongoing legal uncertainty and 
undermining the retirement security of American workers, however. A few 
conversions from traditional plans to hybrid plans have raised policy 
questions about whether such conversions are age discriminatory. But 
notably, the vast majority of conversions have been handled properly 
within the rule of law and to benefit the workers.
  In a typical hybrid plan, a participant's account is credited each 
year with pay and interest credits. Hybrid opponents have argued that 
benefits for younger workers are ultimately higher than benefits 
provided to older workers because younger workers accrue interest and 
earn benefits over a longer period of time. This is tantamount to 
arguing that the concept of compounding interest is age discriminatory, 
which would make the most basic savings account illegal. In short, the 
argument holds no water.
  Recent court decisions made clear that no age discrimination occurs 
with these plans if the pay and interest credits attributed to older 
employee accounts are equal to or greater than those of younger 
workers. And the majority of courts have ruled that hybrid and other 
hybrid plans are not age discriminatory.
  Moreover, under the Employee Retirement Income Security Act and the 
Internal Revenue Code, benefits earned under a traditional plan cannot 
be reduced when they are converted to a hybrid plan. That is right, in 
spite of assertions to the contrary, vested benefits earned by workers 
are never reduced in a hybrid conversion.
  The Pension Protection Act which was approved by a bipartisan 
majority

[[Page 5436]]

in the House last December helps resolve the legal uncertainty 
surrounding hybrid plans and ensures they remain a viable part of the 
defined benefit system. The measure establishes a simple age 
discrimination standard for all defined benefit plans that clarifies 
current law with respect to age discrimination requirements on a 
prospective basis. And it prohibits the reduction of any vested 
benefits workers have earned during a conversion to a hybrid plan.
  Mr. Speaker, our ultimate goal is to ensure hybrid plans remain a 
viable option for employers who want to remain in the defined benefit 
system and workers who prefer the portable and secure benefit this 
option provides. The Pension Protection Act provides a balanced 
approach that protects the benefits workers have earned and provides 
the legal certainty needed to encourage employers to continue offering 
these benefits.
  This Democrat motion to instruct would place harsh mandates on those 
who voluntarily offer these pension benefits, which is particularly 
harmful at a time when so many are leaving the defined benefit system 
altogether. I urge my colleagues to vote ``no'' on the motion to 
instruct and reject this attempt to obscure progress on pension reform.
  Mr. Speaker, I reserve the balance of my time.
  Mr. GEORGE MILLER of California. Mr. Speaker, I yield myself 1 
minute.
  I want to make clear I think the gentleman misunderstands the nature 
of the motion. This is not about whether you have hybrid plans or cash 
balance plans. We made that very clear. We simply want those plans to 
protect the older workers that stand to lose a great deal of benefits.
  For younger workers there is some suggestion these plans may be 
better. It is interesting that 40 percent of the workers in these plans 
never get to a benefit even under this. But at a minimum, it ought to 
be clear that older workers are not going to suffer irreparable 
economic harm in terms of their retirement.
  Mr. Speaker, I yield 3 minutes to the gentleman from New Jersey (Mr. 
Andrews).
  Mr. ANDREWS. Mr. Speaker, I thank my friend and ranking member for 
yielding.
  I appreciate the comment he just made, but the debate here really is 
not about whether the law should authorize hybrid plans or cash balance 
plans. The issue is how should the law authorize those plans and what 
kinds of protections should be included for pensioners and workers.
  I think Mr. Miller's approach in this motion to instruct takes us 
down the right road, and I would urge my colleagues to vote ``yes'' and 
support it.
  There are three issues that we have to resolve here. The first is 
what steps should be taken to prevent the wearing away of benefits for 
workers that have started in a pension plan and then find themselves in 
a different position because of a hybrid plan being adopted.
  Mr. Miller's approach I think uses the most conservative assumptions 
and therefore the fairest assumptions for those workers to make sure 
that they will not lose benefits.
  The second question that has to be addressed is what are the 
conditions under which a conversion will be treated as legal. In other 
words, if an employer has a traditional pension plan today and he or 
she wants to switch that plan to a hybrid plan, what are the ground 
rules for a fair conversion. I think Mr. Miller's approach is the fair 
and just one in that regard as well.
  The third question which is raised in neither bill, but which I hope 
the conference could at least touch on, is what about conversions that 
have already taken place, and what should the ground rules be for those 
with respect to any lingering issues that may have happened with 
respect to them.
  Chairman McKeon I think is right, there does need to be a recognition 
of the proper place of hybrid plans in the defined benefit world. I 
think the House and Senate agree that is the case.
  The issue, though, as Mr. Miller raises, is what are the proper rules 
to ensure fairness in those hybrid plans. I think Mr. Miller takes the 
proper approach, and so I urge a ``yes'' vote on this motion to 
instruct.
  Mr. McKEON. Mr. Speaker, I yield such time as he may consume to the 
gentleman from Minnesota (Mr. Kline), a member of the committee.
  Mr. KLINE. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  Mr. Speaker, in all of the days and weeks and months that we in the 
committee were debating the state of pensions, defined benefit 
pensions, it was clear to all of us that we are losing more and more of 
those plans. More and more employers are going out of business, going 
into bankruptcy, terminating their plans or simply not starting them.
  As has been pointed out, we passed in the House, and I think the 
gentleman from California called it a Republican, but I think it was a 
bipartisan bill with 70 Democrats joining us in that vote, including 
provisions for these hybrid and cash balance plans.
  My fear is that as we put more and more mandates on employers, we 
will lose more and more plans. Without some legal certainty from 
Congress, employers will stop offering these benefits, and cash balance 
plans will simply fall by the wayside like so many other pension 
options.
  This Democrat motion and the Senate bill mandate particular pension 
benefits which could have a devastating effect of accelerating the 
demise of the defined benefit pension system, and I do not think any of 
us want that.
  Consider that in 1986 there were 172,642, that is, 172,642 defined 
pension plans, and that number dropped to 29,000 in recent years. That 
is the wrong direction.
  Greater mandates on employers will only increase this trend. Mandates 
would create enormous problems for employers. For example, a mandate 
would determine pension designs instead of allowing employers to decide 
what is proper for individual businesses, and that would result in more 
plan freezes and terminations if employers are denied the flexibility 
to adapt their plans to business circumstances and employee needs.
  Again, we are faced with the specter of more and more plans going 
away. Employers should be encouraged to offer pension plans, and the 
government should not mandate the vehicle by which to offer such 
benefits to their employees. Mandating a particular type of conversion 
would be harmful to workers. More workers receive higher benefits from 
their cash balance plan than benefits earned under the traditional 
defined benefit plan.
  In any case, we want a solid pension plan and more businesses for 
more workers, and my concern is that this motion to instruct in the 
Senate provision would work the other way. Let's not drive out more 
pension plans. I urge my colleagues to reject this motion to instruct.
  Mr. GEORGE MILLER of California. Mr. Speaker, I yield myself 30 
seconds.
  I would just say that this is about whether or not we continue in the 
direction that the Republican pension bill takes us where the Pension 
Benefit Guaranty Corporation said the bill made the system less secure, 
where the Congressional Budget Office said it made the system less 
secure, and now what we do not have are the protections on cash balance 
plans which make it less secure.
  If we keep going in that direction, if we keep following the 
Republicans, America's retirement benefits will be less and less 
secure. Their retirement will be in greater and greater jeopardy. We 
can change the direction. We can go in another direction. The Senate 
voted 97-2 to provide these kinds of protections. This is not some 
crazy partisan idea. This was a big bipartisan bill with Senator Lott 
and others on this bill, and it is about protecting people's pensions.
  Mr. Speaker, I yield 4 minutes to the gentleman from Vermont (Mr. 
Sanders) who has been working this issue longer than anyone else in the 
House.
  Mr. SANDERS. Mr. Speaker, the middle class of this country is being 
assaulted in so many ways. Millions of Americans are working longer 
hours for low wages. In the last 5 years, 6

[[Page 5437]]

million Americans have lost their health care. We have lost 2.8 million 
good-paying manufacturing jobs. New jobs being created are low wage and 
low benefits.
  But of all of the attacks taking place on the middle class, I think 
the most unspeakable is the assault by corporate America against the 
pensions that were promised to American workers. Just think about it. 
There are millions of people today who have worked for a company for 20 
or 30 years, and one of the reasons they worked for that company is 
that they were promised that when they retire, they are going to have a 
certain pension. And then suddenly out of nowhere a company says thank 
you for working for us for 30 years, thank you for not going to another 
company when you had a better opportunity, but we have changed our mind 
and we are going to cut your pension by 20, 30, 50 percent. It is too 
bad you are 60 years of age and you have no place else to go, that is 
the reality. That is unspeakable, it is unacceptable. When those 
workers have no place else to turn to, it is the job of the United 
States Congress to stand up for them.
  Mr. Speaker, I rise today in strong support of the Miller motion to 
instruct, and I commend the gentleman from California for his 
leadership on this issue.
  Mr. Speaker, pension anxiety is sweeping this country. Millions of 
Americans are worried that the pensions they have today will not be 
there for them when they retire, and with good reason.
  Over the past two decades, large corporations have been breaking the 
retirement promises they made to their employees, and that is wrong. 
Some companies are declaring bankruptcy for the sole purpose of 
breaking those retirement commitments. Other companies are freezing 
pension plans in order to slash retirement benefits of older workers.
  Congress must tell corporate America in no uncertain terms that when 
they make a promise to workers about their pensions, they must keep 
that promise. That is what Mr. Miller's motion is all about.
  Mr. Speaker, last December the House passed a so-called pension 
reform bill that was hundreds of pages long. Included in that bill was 
an obscure provision to legalize age discrimination in cash balance 
plans prospectively. No floor amendments were allowed to strike this 
provision or offer any alternatives to it. Members were forced to vote 
up or down on the entire bill, but the Senate did the right thing. In 
their bill they provided important protections for older workers who 
would be negatively impacted by cash balance schemes. The Senate 
language is supported by the AARP, the AFL-CIO, the National Committee 
to Preserve Social Security and Medicare, the National Legislative 
Retirees Network, and the Pension Rights Center.
  Today, unlike last December, we have an opportunity to do the right 
thing for American workers. We can and should instruct the conference 
committee to adopt the Senate language on cash balance plans.
  Mr. Speaker, there are some who support cash balance schemes. They 
argue that these plans benefit employees. Well, interestingly, a couple 
of years ago I asked the Congressional Research Service a simple 
question: What would happen if Members of Congress had their pensions 
converted to cash balances?
  If it is a good idea for millions of American workers, it must be a 
good idea for us, right? We want to lead. Well, guess what, very few 
Members of Congress thought it was a good idea for this institution. So 
if it is not good for the Members of Congress, I think it is not good 
for the American working people, and I urge strong support for the 
Miller amendment.

                              {time}  1800

  Mr. GEORGE MILLER of California. I yield 3 minutes to the gentleman 
from Ohio (Mr. Kucinich), a member of the committee.
  Mr. KUCINICH. Mr. Speaker, I strongly support the Miller motion to 
instruct conferees. This motion to instruct supports the bipartisan 
Senate compromise language that will protect older workers.
  Now, H.R. 2830 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 protections. This is not only 
unfair, it is wrong. Providing transition protections for older workers 
should not be a choice for employers. It should be a requirement. Any 
change in plans must protect the accrued benefits of employees, and the 
conference report should reflect that reality.
  It is a myth to believe that cash balance plans are innocuous. For 
older workers especially, these plans are hazardous. A pension plan is 
worth nothing if it does not provide security for employees, and these 
plans translate into increased vulnerability for workers as they 
retire.
  Hard working employees should not be rewarded for their service with 
a denial of pension benefits. I urge my colleagues to help ensure that 
workers' pensions are protected by supporting the Miller motion to 
instruct conferees. Let's stand up for people who work a lifetime and 
were told at the beginning of their work experience the money was going 
to be there to enjoy their golden years. Support the Miller amendment 
and put some teeth behind that guarantee.
  Mr. GEORGE MILLER of California. Mr. Speaker, I yield 3\1/2\ minutes 
to the gentlewoman from Ohio (Mrs. Jones).
  Mrs. JONES of Ohio. Mr. Speaker, I serve on the Ways and Means 
Committee, and I rise in support of Mr. Miller's motion to instruct 
conferees.
  Eliminating wear-away, or the fact that dollars for older workers 
under a cash balance plan tend to wear away in value, is very 
important. We need to ensure that when an employer converts from a 
traditional defined benefit plan to a cash balance plan, workers 
receive their full benefits. But we also need to ensure that we draft 
rules that protect older workers, because they could be vulnerable 
during such conversions.
  But more importantly, I want to talk about the issue of 
retroactivity. Addressing retroactivity is important to the retirement 
security of many American workers in my congressional district.
  Employers that sponsor cash balance plans and other hybrid plans have 
been hanging in limbo for almost 7 years.
  The Internal Revenue Service has felt it necessary to temporarily 
stop issuing determination letters for converted hybrid plans, and 
litigation throughout our court system has left the legality of all 
cash balance plans up in the air.
  In my congressional district, I have four major employers that offer 
pension benefits to their employees through either a cash balance or 
other hybrid pension plan. Some of these plans were acquired through 
mergers/acquisitions while some were adopted through conversions.
  The employers treated their employees fairly, giving them the choice 
whether or not to convert the plans, and ensuring that worker benefits 
were not diluted, and these four employers are not alone. There are a 
lot of good actors across the country.
  According to a recent AARP-funded study, 23 of the largest 25 cash 
balance plans, or 92 percent, provided transition protections for their 
older employees when converting from traditional defined benefit plans 
to cash balance plans.
  Nonetheless, the four employers in my district, as well as 1,100 
others across the country, are caught in a web of legal uncertainty. We 
are in an era where companies are eliminating their pension plans, 
including hybrid plans; not fixing this problem will only perpetuate 
that trend.
  A recent survey of planned sponsors by Watson Wyatt showed that more 
than 25 percent of our employers who offer a hybrid pension plan either 
froze their plan or were actively considering terminating or freezing 
their plan.
  A cash balance is a defined benefit plan, and it is the future of our 
defined

[[Page 5438]]

benefit system. It allows people to move from one employer to the other 
employer. But we need to give them protections in that process.
  If Congress does not resolve the legal uncertainty that cash balance 
plans currently face, employers will continue to terminate their 
pensions. That would not be beneficial to the retirement security of 
hard working Americans.
  The conferees need to address retroactivity and establish benefit 
accrual standards and establish benefit accrual standards as it relates 
to age discrimination and that encourage employers to retain their cash 
balance plans and not dump them.
  For Congress to not resolve this issue would be unwise public policy 
and would put the retirement security of thousands of workers at risk. 
This is our chance to fix the problem. We must seize it. On behalf of 
the workers and companies, let's clear up this confusion and put 
workers back in the right place.
  Mr. GEORGE MILLER of California. Mr. Speaker, I yield 3 minutes to 
the gentleman from Minnesota (Mr. Gutknecht).
  Mr. GUTKNECHT. Mr. Speaker, there are a lot of issues we talk about 
here on the House floor where Members don't know much about the issue 
they are talking about. This may be one for me. But I did serve on the 
Pension Commission of the State of Minnesota and I know something about 
defined benefit plans. I know something about defined contribution 
plans, and I understand how pension plans in general work, and so I 
rise in support of the Miller motion.
  The reason this issue is here, and my colleague from Ohio just 
described it very well, the reason we are here is that we are now in 
the process where many employers are converting their pension plans 
from old defined benefit plans to this new hybrid plan called a cash 
balance plan. And I am not opposed to that basic notion.
  But what happens, Members, and you need to understand, is many older 
workers show up for work one day and their pension plan has changed.
  Now, the employers say, well, that is our pension plan and it is our 
money. Well, that is not exactly true. That money is being held in 
trust, and this has been a very craftily done procedure to allow many 
employers or some employers to take money from the pension plans and 
convert it to their bottom line, and that is wrong. This is not their 
money. That is the first point everybody needs to understand.
  The second thing people need to understand is the Senate did a better 
job of writing their bill. This is all here because of a few bad 
actors, and the Senate said we are not going to protect those bad 
actors, and so the Senate did a better job. We wouldn't even be talking 
about this if we had all agreed on some language that would have 
protected those older workers.
  Members, this is the right thing to do, and I want to say to my 
Republican colleagues, what we are talking about here is language that 
was inserted by the Senator from Iowa, who is a Republican. Okay? This 
is not a Republican issue. It is not a Democrat issue. It is not right 
versus left. It is right versus wrong. It is wrong to allow a certain 
number of employers to get their hands into the pension funds and to 
change these pension plans without talking to their workers. It 
happened at IBM and they were taken to court and Federal court ruled 
that this is age discrimination. And do you know what? I agree with 
that Federal court.
  So Members, please support the Miller motion to instruct. All we are 
saying is we want the Grassley language in the final product when it 
comes back from conference. If we do that, we will have served the best 
interest of working Americans, and I think we will have served those 
employers who are doing the right thing, and we will send a clear 
message to those employers who either have done the wrong thing or want 
to do the wrong thing, that we are not going to put up with that.
  This is a good motion. It is not a Republican motion. It is not a 
Democrat motion. We are simply saying, let's keep the Grassley language 
in the final product.
  I rise in support of this motion to instruct conferees. The motion 
instructs the conferees to adopt the Senate provisions on cash balance 
plans in S. 1783 written by Senator Grassley and his Committee and 
passed by the Senate by a vote of 97-2.
  These are common sense reforms supported by the vast majority of the 
Senate and AARP.
  I supported H.R. 2830, the Pension Protection Act of 2005, when it 
passed the House. At the time, I noted it contained a weakness that I 
wanted to see addressed in conference committee. The weakness of the 
House bill is that it does not have strong rules regulating the 
conversion of defined benefit pension plans into cash balance plans. On 
the other hand, under the Senate bill, employees would be given added 
protections so that older employees are not put at a disadvantage when 
conversions take place.
  Millions of Americans are currently vested in defined benefit pension 
plans. Even though they may be working for a very profitable company, 
they could show up for work one day and learn that their promised 
benefits have been dramatically reduced with the sweep of a pen. This 
is what happened to thousands of employees in my district.
  Millions of Americans will be affected by this legislation. It is 
important we get it right. I ask my colleagues to support the Miller 
motion to instruct.
  Mr. GEORGE MILLER of California. Mr. Speaker, I yield 2 minutes to 
the gentleman from Massachusetts (Mr. Tierney), a member of the 
committee.
  Mr. TIERNEY. Mr. Speaker, I would like to add my words in agreement 
with the gentleman from Minnesota, that this is not a partisan motion 
in any sense of the word. This is something that Members of Congress, I 
think, can get behind and clearly feel comfortable that they are just 
serving the interests of their constituencies.
  This particular motion does take the language from Senator Grassley, 
on the other side of the House, that puts it into the bill that it 
would prohibit the wearing away, the practice by which some employers 
have discriminated against older workers when they offset the benefits 
that were already earned against their ability to earn new benefits 
under these new cash benefit plans. They can result in no new benefits 
being added, actually, for workers' pensions for up to 10 years.
  And they provide for a fair transition for rules to protect workers' 
pensions when they do convert the traditional pensions to those so 
called cash balance pension plans.
  We critically need this. You only need to talk to the people in your 
districts, my colleagues, and you will find a growing sense of 
insecurity in this country as corporations back off their 
responsibilities for health insurance, back off their responsibilities 
for retirement plans, and now come up with a cash balance plan which is 
supposed to be a plan melding two different types of retirement 
programs and ends up hurting some.
  One of my constituents talked about having worked for AT&T for 30 
years. After 30 years of loyal work, the conversion of her pension to a 
cash balance plan reduced her benefits by 46 percent. It is not fair. 
It is not right, and it shouldn't be acceptable to Members of this 
Congress.
  The Government Accountability Office released a major report on cash 
balance plans last November. They found that workers of all ages 
experience significant cuts to their retirement benefits when their 
employers switch from the traditional pension plan to the so-called 
cash balance plans without first protecting employees rights.
  Over 85 percent of 30-year-olds, 90 percent of 40-year-olds and half 
of the 50-year-olds experience deep cuts in their retirement benefits 
if they are shifted from a traditional pension plan into a cash balance 
plan without protections for retirement benefits.
  The GAO study did not find a single case, not a single case in which 
the cash balance plan provided the same level of retirement benefits 
that a typical defined benefit plan provided.
  Without transition protection, almost all workers, including younger 
workers, will lose up to 50 percent of their expected pension benefits. 
And, Mr. Speaker, we can't allow that to happen.

[[Page 5439]]

  I ask my colleagues to join with Mr. Miller in this attempt to make 
sure that we do protect this group of pensioners.
  Mr. McKEON. Mr. Speaker, I yield such time as he may consume to the 
gentleman from North Dakota (Mr. Pomeroy), my friend from the other 
side of the aisle.
  Mr. POMEROY. Mr. Speaker, I am going to oppose this motion to 
instruct. I certainly think there is a good intention behind it. 
Clearly, all of us have been concerned when we have had some of these 
conversions from a traditional pension plan to a hybrid plan, and older 
workers have suddenly found that they have been terribly disadvantaged 
in the conversion, seen their pension benefits and expected pension 
benefits reduced significantly.
  But here is why I don't like this motion. It fails to really address 
this issue in the context of what is in the marketplace. You have got 
defined benefit pensions that pay an annuity for as long as the 
employer lives. I think we should work together to make sure defined 
benefit pensions continue in the marketplace to the extent possible.
  To the extent we don't have a defined benefit pension, alternative 
employee benefits relative to retirement include a 401(k) plan, which 
is essentially a savings account, and then there is something in 
between, a hybrid plan that does capture the annuitized feature of the 
pension, calculated in a different way than the traditional pension 
calculation.
  Now, it is important that we have best practices and fair treatment 
in the conversion of a pension to a hybrid plan. But guess what? If we 
overly regulate the conversion from the pension to the hybrid plan, the 
employer will simply say, okay, we will go from the pension to the 
defined contribution plan. We are not going to make this intervening 
stop in the hybrid option, the cash balance option. We are just going 
to either scrap the benefit altogether or go right to the defined 
contribution plan.
  I am convinced that that is not in the interest of workers, and that 
is why I am convinced that the Senate approach, which is advanced by 
this motion to recommit, actually does not help the very workers that 
we care about and we intend to help.
  There is no question about the sincerity of the language by the 
proponents of this motion. They care about protecting older workers. It 
is just that, technically, what they have put before this body in a 
motion to recommit does not do that. I believe it actually may 
disadvantage the very people they hope to help by instead of moving to 
cash balance hybrid plans that at least preserve some features of the 
pension, they will just scrap that option altogether. I don't see 
anybody winning under that proposal. I urge a ``no'' vote.

                              {time}  1815

  Mr. McKEON. Mr. Speaker, I yield such time as he may consume to the 
gentleman from Florida (Mr. Foley), member of the Ways and Means 
Committee.
  Mr. FOLEY. Mr. Speaker, let me start by suggesting that I know all of 
us in this room are concerned about the viability of pensions. We want 
people who have worked their entire life to get the benefit of those 
investments. What we are also, though, trying to do is ensure that 
employers, corporations find a way in which to bring about the new 
realities of the marketplace, providing options.
  For years people who worked in America relied on the standard fixed 
pension provided by, say, General Motors or another corporation. Over 
the years evolved opportunities to create hybrid plans, plans 
personally that I enjoy, an IRA account, a 401(k) offered through 
Congress, Thrift Savings, Keogh plans, and you can go on with all of 
the acronyms, Roth IRA, all designed to give people options in a 
marketplace, to give them some degree of certainty and some opportunity 
to provide these benefits.
  Nine million workers today rely on the benefits for safe and secure 
retirement, which is an important number to note. What we are trying to 
figure out is how to create plans, cash balance plans, that provide 
both the liquidity and the opportunity to continue.
  Adelphia is claiming bankruptcy. GM is on the verge. Large 
corporations are all suggesting that they are going to file based on 
their pension benefit problems that they are experiencing. We have seen 
it in the airline industry. So I think it is more important now than 
ever that we come up with an opportunity to both solidify and provide 
options. Distorting the facts will not help. Painting a misleading, 
inaccurate picture will not help. Suggesting somehow that we are 
chasing people out of defined pensions and creating this uncertainty I 
do not think is a true portrayal of the actions today.
  The conclusions emerging from a growing body of independent research 
by economists and academics at some of the Nation's most respected 
institutions, and I quote this from Mr. McKeon's opening statement 
because I think it is important to underscore, including the Federal 
Reserve Board, the Urban Institute, the Brookings Institute, and the 
Wharton School, not only are hybrid plans especially advantageous for 
women and lower-paid workers, but they also comprise the only part of 
the defined benefit system that is growing. Hybrid plans now provide 
the Pension Benefit Guaranty Corporation with approximately 25 percent 
of its premium income. And I need only remind our Members of Congress 
PBGC is sliding on thin ice. So if they are actually getting derived 
revenue from this opportunity, we should not only be encouraging it. We 
should hopefully be expanding it.
  As we know, those that are paying into the system like airlines and 
others no longer can make contributions because they have specifically 
filed for bankruptcy to take away those obligations and foist that 
obligation back on PBGC, which is why I believe we are all working on a 
solution. We are trying to find answers. And the total number of 
defined benefit plans has decreased significantly over the last 20 
years, so that tells you people are moving away from defined benefits, 
looking for options. If we foreclose this option, make it more 
difficult for this option and disparage this option and give people an 
uncertainty, then fewer and fewer people will have any type of benefit 
to look forward to after years of work.
  The threat of liability is creating ongoing legal uncertainty and 
undermining the retirement security of American workers. So I think and 
suggest that the conversions are appropriate, that this bill is 
appropriate, and I urge my colleagues to focus on the facts. And I 
think they will agree, as they see the success of hybrid pension plans, 
that these are, in fact, working for America, for both middle income, 
middle management, and upper management to find ways to create a secure 
and safe retirement for people who are investing in those companies, 
their workplaces, so that they can then take care of their golden years 
with some comfort.
  Mr. GEORGE MILLER of California. Mr. Speaker, I yield 1 minute to the 
gentlewoman from Texas (Ms. Jackson-Lee).
  Ms. JACKSON-LEE of Texas. Mr. Speaker, I thank the distinguished 
gentleman from California for his leadership.
  I do not know why we have this controversy. I do not see anything 
controversial about protecting, if you will, the rights of older 
workers. And I might remind my colleagues that the House of 
Representatives has already voted three times to require the Treasury 
Department to protect older workers from age discrimination and cash 
balance conversions.
  This motion to instruct is simple. It provides protection for older 
workers under cash balance conversion; but more importantly, it is part 
of a negotiated Senate bill that has a bipartisan approach.
  Mr. Speaker, I come from the city of fallen pensions, and that is, of 
course, the city of Houston. I am reminded of the tears and the 
disaster that occurred after the Enron collapse that showed that the 
lack of security for pensions in general and certainly those of older 
workers can be the actual collapse of a family.
  This motion to instruct provides for prohibiting discrimination 
against

[[Page 5440]]

older workers by the practice of offsetting previously earned pension 
benefits. I would only say we have voted for this before. Uncloud the 
issue and vote the right way, for the Miller motion to instruct to 
protect older workers' pensions.
  Mr. McKEON. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, for the benefit of all those who are watching this 
debate, let me just kind of let everybody know where we are. The Senate 
passed a bill, a bipartisan bill. The House passed a bipartisan bill 
with a vote of 294-132, some of the Democrats voting for the bill. 
During the debate you have seen, we have had Republicans speak for the 
Democrat side. We have had Democrats speak for the Republican side.
  We are all concerned, as Mr. Foley said, about the workers of 
America. Where we are now is we have each passed bills. A conference 
has been appointed. Senator Enzi is chairman of the conference. We have 
had a couple of meetings of the whole conference, and he is continuing 
to work with all members of the conference, or most of the members of 
the conference, to see that we get a bill out that will benefit the 
workers of America.
  As was already mentioned, in 1986 there were 172,642 defined benefit 
plans. We are now down to 29,000. That is not a good direction. And the 
problem is we have not had meaningful pension reform in over 20 years. 
We are close now. This is a motion to instruct the conferees, to tell 
them how to function in this conference that has been set up. These 
motions are not binding, but they do give direction to conferees, and I 
think it is important that we do this. It is a good process for all of 
us to get to talk through this system. But the defined pension system 
is a voluntary system, and those offering these benefits have been 
leaving the system at an accelerating and alarming rate, and we are 
concerned about that. If we continue to burden those providing pension 
benefits with more and more mandates, that pace will increase even 
more.
  And who loses? The men and women depending on these pensions for 
their retirement security. Simply put, short-sighted and politically 
motivated mandates intended to help pension plan participants only end 
up hurting them. And that is just what this motion to instruct would 
do.
  For the sake of both employers and employees alike, we need to 
provide legal certainty for hybrid plans. The Pension Protection Act 
will provide that. This motion to instruct will not.
  I urge my colleagues to reject it and protect the portable and secure 
benefits provided by hybrid plans to nearly 10 million Americans.
  Mr. Speaker, I yield back the balance of my time.
  Mr. GEORGE MILLER of California. Mr. Speaker, I yield myself such 
time as I may consume.
  It is very simple. There are millions of Americans that are caught in 
this trap, the gap between what they would have gotten and what they 
will get under a pension conversion. You know what is in this gap? The 
dreams, the aspirations of hardworking Americans about their 
retirement, their plans for their grandchildren, their plans for 
themselves, their health security. That is what they were planning on 
paying for out of this gap. That is what they lose in a conversion.
  All we are saying in this effort is to simply provide these people 
the additional protections that the Senate provided by 97-2. Now, we 
know this is a very partisan Congress, but 97 people came together and 
decided to try to help these individuals. They still allow for the 
conversions to cash balance. They provide the certainty that the 
employers want, and they provide the protection that the employees 
need.
  Now, this House can continue to follow the Republican bill, the 
Republican direction on pensions that has made the pension plan less 
secure, made the pension plan more in jeopardy, whether it is the 
taxpayers who are at risk or the employees who are at risk. That is the 
wrong direction. Finally, on a bipartisan basis, a choice was made to 
go in a different direction, to stop this failed policy.
  Pick up your USA Today. Read your USA Today today, and you will see 
that they make it clear that the bill that is currently in conference, 
the House bill, puts pensions in greater jeopardy with greater risk, 
that it will raise the risk that these people will lose their pensions. 
Why? Because the Republicans continue to let you manipulate the pension 
data. You can say that your employees are going to die younger so you 
will not have to pay out as much money. Whether they will or not has no 
bearing in fact.
  So what are we doing here? We are trying to go in a different 
direction. We are trying to go in the direction of pension security, of 
retirement security, of peace of mind for people who are working hard, 
understanding that these employees earn these pensions and they should 
not lose them because some accountant can just come along and change it 
with the whisk of a pencil. It is not fair to those individuals. That 
is about the values of those people who are working hard. It is about 
young people knowing that their parents will be taken care of, that 
they will be able to have that retirement security.
  Millions of Americans are watching as pension plans are crashing to 
the floor, as conversions are made and older workers are jettisoned in 
terms of these protections.
  But you can change that with this motion to instruct. You can change 
it along the lines of a bipartisan consensus in the Senate which said 
you can both protect these workers, have the certainty of your 
conversions, and allow employers to choose to have conversions or 
defined benefit plans. It is the best of all worlds. It is the 
fairness.
  The other reason Republicans can vote for it tonight is because I 
understand the Republican leadership said go ahead and vote your 
conscience. Well, tonight we will find out about the Republican 
conscience. Do they really want to take care of older Americans who are 
terrified about their retirement security? We will find out tonight, 
won't we? Because you do not have to jeopardize cash balance. You do 
not have to jeopardize the certainty of discrimination. But you do get 
to take care of the retirees, and you can do it all in one vote: a 
motion to instruct here.
  So I suggest you come on down and let us change the direction of 
retirement security from insecurity that is now being presented by this 
conference committee, by the Republican bill, to one of security for 
America's workers, for America's retirees, to make sure that they will 
have the ability to take care of themselves and their families in the 
future. It is fundamental. It is basic. It is about fairness. It is 
about the direction of this country. We have got to change it.
  The SPEAKER pro tempore (Mr. Kuhl of New York). 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, this 15-
minute vote on the motion to instruct conferees on H.R. 2830 will be 
followed by 5-minute votes on the motion to instruct conferees on H.R. 
4297 and on five motions to suspend the rules previously postponed.
  The vote was taken by electronic device, and there were--yeas 248, 
nays 178, not voting 6, as follows:

                             [Roll No. 93]

                               YEAS--248

     Abercrombie
     Ackerman
     Aderholt
     Allen
     Andrews
     Baca
     Baird
     Baldwin
     Barrow
     Bass
     Bean
     Becerra
     Berkley
     Berman
     Berry
     Bilirakis
     Bishop (GA)
     Bishop (NY)
     Blumenauer
     Boehlert
     Boren
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Burgess
     Butterfield
     Capito
     Capps
     Capuano
     Cardin

[[Page 5441]]


     Cardoza
     Carnahan
     Carson
     Case
     Chandler
     Clay
     Cleaver
     Clyburn
     Conyers
     Cooper
     Costa
     Costello
     Cramer
     Crowley
     Cuellar
     Cummings
     Davis (AL)
     Davis (CA)
     Davis (FL)
     Davis (IL)
     Davis (KY)
     Davis (TN)
     Davis, Jo Ann
     Davis, Tom
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Dent
     Dicks
     Dingell
     Doggett
     Doyle
     Edwards
     Ehlers
     Emanuel
     Emerson
     Engel
     Eshoo
     Etheridge
     Farr
     Fattah
     Ferguson
     Filner
     Fitzpatrick (PA)
     Forbes
     Ford
     Fortenberry
     Frank (MA)
     Frelinghuysen
     Garrett (NJ)
     Gerlach
     Gilchrest
     Gonzalez
     Goode
     Gordon
     Green, Al
     Green, Gene
     Grijalva
     Gutierrez
     Gutknecht
     Hall
     Harman
     Hastings (FL)
     Herseth
     Higgins
     Hinchey
     Hinojosa
     Hobson
     Holden
     Holt
     Honda
     Hooley
     Hoyer
     Inslee
     Israel
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Johnson (IL)
     Johnson, E. B.
     Jones (NC)
     Jones (OH)
     Kanjorski
     Kaptur
     Kelly
     Kennedy (RI)
     Kildee
     Kilpatrick (MI)
     Kind
     King (IA)
     King (NY)
     Kirk
     Kucinich
     LaHood
     Lantos
     Larsen (WA)
     Larson (CT)
     Leach
     Lee
     Levin
     Lewis (GA)
     Lipinski
     LoBiondo
     Lofgren, Zoe
     Lowey
     Lynch
     Maloney
     Markey
     Marshall
     Matheson
     Matsui
     McCarthy
     McCollum (MN)
     McDermott
     McGovern
     McHugh
     McIntyre
     McKinney
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Melancon
     Michaud
     Millender-McDonald
     Miller (NC)
     Miller, George
     Mollohan
     Moore (KS)
     Moore (WI)
     Moran (KS)
     Moran (VA)
     Murphy
     Murtha
     Nadler
     Napolitano
     Neal (MA)
     Ney
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Peterson (MN)
     Platts
     Price (NC)
     Pryce (OH)
     Rahall
     Rangel
     Regula
     Reyes
     Ross
     Rothman
     Roybal-Allard
     Royce
     Ruppersberger
     Rush
     Ryan (OH)
     Sabo
     Salazar
     Sanchez, Linda T.
     Sanchez, Loretta
     Sanders
     Saxton
     Schakowsky
     Schiff
     Schwartz (PA)
     Scott (GA)
     Scott (VA)
     Serrano
     Shays
     Sherman
     Sherwood
     Simmons
     Skelton
     Slaughter
     Smith (NJ)
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Strickland
     Stupak
     Sweeney
     Tauscher
     Taylor (MS)
     Thompson (CA)
     Thompson (MS)
     Tierney
     Towns
     Udall (CO)
     Udall (NM)
     Van Hollen
     Velazquez
     Visclosky
     Wamp
     Wasserman Schultz
     Waters
     Watt
     Waxman
     Weiner
     Weldon (PA)
     Wexler
     Whitfield
     Wolf
     Woolsey
     Wu
     Wynn

                               NAYS--178

     Akin
     Alexander
     Bachus
     Baker
     Barrett (SC)
     Bartlett (MD)
     Barton (TX)
     Beauprez
     Biggert
     Bishop (UT)
     Blackburn
     Blunt
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Boustany
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Brown-Waite, Ginny
     Burton (IN)
     Calvert
     Camp (MI)
     Campbell (CA)
     Cannon
     Cantor
     Carter
     Castle
     Chabot
     Chocola
     Coble
     Cole (OK)
     Conaway
     Crenshaw
     Cubin
     Culberson
     Deal (GA)
     DeLay
     Diaz-Balart, L.
     Diaz-Balart, M.
     Doolittle
     Drake
     Dreier
     Duncan
     English (PA)
     Everett
     Feeney
     Flake
     Foley
     Fossella
     Foxx
     Franks (AZ)
     Gallegly
     Gibbons
     Gillmor
     Gingrey
     Gohmert
     Goodlatte
     Granger
     Graves
     Green (WI)
     Harris
     Hart
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Hensarling
     Herger
     Hoekstra
     Hostettler
     Hulshof
     Hunter
     Hyde
     Inglis (SC)
     Issa
     Istook
     Jenkins
     Jindal
     Johnson (CT)
     Johnson, Sam
     Keller
     Kennedy (MN)
     Kingston
     Kline
     Knollenberg
     Kolbe
     Kuhl (NY)
     Latham
     LaTourette
     Lewis (CA)
     Lewis (KY)
     Linder
     Lucas
     Lungren, Daniel E.
     Mack
     Manzullo
     Marchant
     McCaul (TX)
     McCotter
     McCrery
     McHenry
     McKeon
     McMorris
     Mica
     Miller (FL)
     Miller (MI)
     Miller, Gary
     Musgrave
     Myrick
     Neugebauer
     Northup
     Norwood
     Nunes
     Nussle
     Osborne
     Otter
     Oxley
     Paul
     Pearce
     Pence
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Poe
     Pombo
     Pomeroy
     Porter
     Price (GA)
     Putnam
     Radanovich
     Ramstad
     Rehberg
     Reichert
     Renzi
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Ryan (WI)
     Ryun (KS)
     Schmidt
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shimkus
     Shuster
     Simpson
     Smith (TX)
     Sodrel
     Souder
     Stearns
     Sullivan
     Tancredo
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Tiahrt
     Tiberi
     Turner
     Upton
     Walden (OR)
     Walsh
     Weldon (FL)
     Weller
     Westmoreland
     Wicker
     Wilson (NM)
     Wilson (SC)
     Young (AK)
     Young (FL)

                             NOT VOTING--6

     Buyer
     Evans
     Langevin
     Schwarz (MI)
     Tanner
     Watson

                              {time}  1856

  Messrs. BARRETT of South Carolina, PICKERING, NEUGEBAUER, RADANOVICH, 
BOOZMAN, MARCHANT, REHBERG, POMEROY and FOSSELLA changed their vote 
from ``yea'' to ``nay.''
  Messrs. GARRETT of New Jersey, WAMP, BACA, RUSH, NEY, WHITFIELD, 
JOHNSON of Illinois, BASS, RYAN of Ohio, DAVIS of Kentucky, HALL and 
FORBES, Ms. BEAN and Mrs. JO ANN DAVIS of Virginia changed their vote 
from ``nay'' to ``yea.''
  So the motion to instruct was agreed to.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.
  Stated for:
  Mr. SCHWARZ of Michigan. Mr. Speaker, on rollcall No. 93 I was 
unavoidably detained. Had I been present, I would have voted ``yea.''

                          ____________________