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  #41  
Old 08-23-2014, 07:25 PM
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Mary Pat Campbell
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http://www.huffingtonpost.com/randy-...b_5688521.html

Quote:
Congress has left Washington for the summer and with each passing week of inaction the problems facing the 10.4 million multiemployer plan participants become tougher to fix.

With key provisions of the Pension Protection Act of 2006 expiring in December, employers, participants and trustees in the multiemployer pension universe face the uncertainty that comes with the approaching deadline without any guidance from policymakers.

Employers need a system that doesn't place their businesses at risk, and employees and retirees need to know that their retirements are secure. They deserve a pension system - and retirement benefits - that they can count on, yet the longer Congress waits to take action, benefit losses become more likely and more severe. The system can recover if Congress takes timely action to provide the tools needed so the worst-off multiemployer plans can preserve and extend benefits for retirees and shore up the system for future beneficiaries.

Nationwide, there are approximately 4 million retired Americans who rely on multiemployer pensions for retirement security. These retirees use this income to buy goods and services, fueling local economies and supporting their communities. All told, multiemployer pensions have an estimated national economic impact of $38 billion. Now, thanks to a brand new online tool, we have data that documents the Multiemployer Pension Impact - or #MPI - in each state.

.....
With only a few short weeks of congressional action remaining in the year and Congress' to-do list growing, multiemployer plan participants are understandably nervous. With modest reforms to federal pension laws, Congress could provide long-term stability to multiemployer plan participants, shift the risk of potential responsibility away from the taxpayer, and reduce the financial pressure on thousands of American employers struggling to maintain pensions for their workers. With the impacts on each state now made so clear, the question is: don't these employers and retirees deserve action?

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  #42  
Old 09-03-2014, 12:22 PM
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http://crr.bc.edu/briefs/the-financi...pension-plans/

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The brief’s key findings are:

-While most multiemployer pension plans are finding their financial footing, a substantial minority face serious problems.
-The key reason is a declining financial base, which results in negative cash flow.
-Plans deemed in “critical” condition can raise contributions, cut future benefits, and/or cut “adjustable” benefits that apply to retirees as well as active workers.
-To date, plans have focused on raising contributions and cutting adjustable benefits, with less emphasis on cutting benefit accruals for active workers.

-Nevertheless, a simple model suggests that one third of “critical” plans could exhaust their assets within 30 years.
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  #43  
Old 09-03-2014, 01:05 PM
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Originally Posted by campbell View Post
Let's put a number of competitors into an inverse Tontine and see how that works out.

I wonder why we don't know who invented these. Are they a post-WWII union invention? Did they emerge from insurance companies? I'm pretty sure that the Segal Company wants these plans to survive as long as possible, maybe even as long as their other cash cow -- publics.
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Old 09-04-2014, 12:47 PM
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MEPs were heavily encouraged by the Taft-Hartley Act of 1947. I don't know anything about the politics of how the act got drafted and passed, but presumably this was a bone to the unions to balance out other provisions that made unions refer to Taft-Hartley as the "slave labor" bill.
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  #45  
Old 09-18-2014, 10:19 AM
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Three actuaries testified in Congress yesterday:

http://waysandmeans.house.gov/calend...EventID=393078

Tully and Hall and I are all actuaries. At one point Scott Henderson of the Kroger Company said: "I am not an actuary but I am surrounded by them," referring to his co-panelists.

Surrounded by actuaries may conjure up a frightening image. After a suitable ransom, we released him.
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Old 09-18-2014, 10:38 AM
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Wow, I have to say that Hall's testimony seems completely useless. Technically quite accurate and informative, but what problem does the information he provided help solve? No wonder the SOA is not taken seriously when important policy questions come up.
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Old 09-18-2014, 11:14 AM
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Yes, Jeremy's testimony is more useful and has some concrete recommendations in it:

http://waysandmeans.house.gov/upload...ony_091714.pdf

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My message is this: unless accurate estimates of future cost are on the table and open for all to see, the combination of benefit cuts and employer costs will not reduce the deficit, will not fill the hole. On the contrary, the hole will get bigger unless two necessary steps are taken:

 first, get the right price for all future benefit accruals and make sure at an absolute minimum that these are paid, and
 second, accurately measure the deficit and decide when, how and who pays to fill the hole.

How can we get the right price? Actuaries trying to balance the needs of the employees and the employers cannot be expected to push valuations uphill when the interested parties want to go downhill. I believe that the concept of an independent consulting actuary putting a value on these benefits is irreparably flawed. The party setting the price must have very significant skin in the game and capital at risk. The party that sets the price must also guarantee the benefits and hold sufficient capital to make good on its guaranty.

The need to have capital at risk guarantying benefit promises implies something like insurance companies with actuaries whose primary obligation is to the company that puts up the capital, guarantees the benefits and employs the actuary. These institutions do not have to be insurance companies as we know them but they must combine capital, benefit guarantees and actuarial expertise.1

Summary
 Measure accrued liabilities and future costs accurately.
 Accurate measurements will be made only by parties with skin in the game combining capital,
benefit guarantees, and actuarial expertise.

 To avoid making matters worse than they already are, plans must, at an absolute minimum:
o Pay the full price for newly earned benefits or reduce accruing benefits to match
available funding.
o Pay the interest on unfunded accrued liabilities.
I think I may take the actuarial testimony and give it to my writing class to compare/contrast usefulness of the communications.
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Old 09-18-2014, 11:15 AM
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Jeremy, was there any Q&A?

I didn't see a transcription of any such, but I would assume some questions were asked.
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Old 09-18-2014, 01:03 PM
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Originally Posted by campbell View Post
Jeremy, was there any Q&A?

I didn't see a transcription of any such, but I would assume some questions were asked.
There was Q&A. There should be a transcript posted eventually.
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  #50  
Old 09-18-2014, 01:08 PM
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Originally Posted by campbell View Post
Yes, Jeremy's testimony is more useful and has some concrete recommendations in it:

http://waysandmeans.house.gov/upload...ony_091714.pdf



I think I may take the actuarial testimony and give it to my writing class to compare/contrast usefulness of the communications.
Dale communicates perfectly well. The posted testimony is the written testimony not the oral. In my case, because I had little time to prepare, my written and oral are almost identical. Dale offered oral testimony that was much shorter and focused than the posted written submission.

The Chairman asked Dale for a concise bottom line and Dale replied that mortality improvements were likely to raise pension costs by 4-8% (I hope I got this right).
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