While the union bosses party, and while the White House names their leadership to a deficit spending panel, the truth is that the union position is eroding — and the unions know it. The Workforce Fairness Institute has a new video out today using the occasion of an annual conference to skewer the wishful thinking of the labor movement these days, but the WFI may have buried the real lede a bit. They mention the problem of underfunded pension plans almost in passing, but that’s key to the rising desperation in the union hierarchy:
The union pensions are similar in many ways to the Social Security and Medicare entitlement disasters looming for the US. Unions have repeatedly raided pension funds on the assumption that growth in membership would allow them to eventually cover all of the commitments to its beneficiaries. They need Card Check as a means to force millions of workers to start contributing to their Ponzi-scheme structures to stave off utter collapse.
Yid with Lid has some interesting data on this problem:
Should these pension plans collapse its curtains for the Union Leaders and it would not be the best recruiting tool for the labor movement in general.
How bad off are the union pension plans? The best single indicator of a plan’s financial health is its Funding Percentage. A fully funded plan will have a funding percentage of 100%. A plan is underfunded when the percentage is below 100%. The lower the percentage, the greater the risk that benefits will not be available when they come due.
According to the Pension Protection Act of 2006 multi-employer (plans set through unions and company sponsors) plans are evaluated via their funding levels. To ensure retiree benefits are protected, when a multiemployer plan falls below certain funding levels, stronger funding requirements become effective under provisions of the Pension Protection Act of 2006. Plans whose funding levels are below 80% are referred to as “endangered,” while those below 65% are referred to as “critical.”
The SEIU National Industry pension fund is right at the 65% mark. The Newspaper Guild’s plan is at 62.8%, which is interesting in that newspapers seem uninterested in reporting on the problem. Sheet Metal Workers National is only funded to 38%.
If one wants to understand the desperation of Andy Stern and his allies in the Democratic Party to push Card Check — and to eliminate the secret ballot for workers in organizing elections — one need only look at the multitude of pension funds in critical condition. That also applies to union efforts to expand the federal government, which would mean a greater demand for workers paying dues to unions like SEIU and AFSCME (the latter of which doesn’t appear to have these kind of pension issues). It’s also no great surprise that the White House has been pushing to favor union-shop bids in federal contracting, for the same reasons.
With all of this in mind, one has to wonder why the unions pushed so hard on ObamaCare when they should have been looking out for their main interest, which is to strip private-sector employees of a critical protection against union intimidation in organizing efforts. That miscalculation will probably cause some heads to roll when Democrats lose control of Congress, perhaps even Stern’s himself.
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