21/05/2016

Rejected: Central States Fund Proposes 60% Pension Cuts, Treasury Dept Says “Not Enough”; 407,000 Affected - by Mike Shedlock

Jeff Fitchett: Every defined benefit pension plan is going to suffer the same fate as the Central State Fund.  DB pensions are ponzi schemes given that the first person in is the first person to be paid out.  Employees who join the plan years later will never receive the promised pension payments because actuarial assumptions are flawed.   

Courtesy of Mike (Mish) Shedlock

407,000 private sector workers are about to lose most of their pensions.
The Central States Pension Fund, which handles the retirement benefits for current and former Teamster union truck drivers across various states applied for reductions under that law.
Currently the plan pays out $3.46 in pension benefits for every $1 it receives from employers. That’s a drain of $2 billion annually.
The plan filed for 60% cuts in pensions. The Treasury Department has the final say. The verdict came in today: “cuts not deep enough”.

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