Reactions to the passage of the American Rescue Plan Act, the latest COVID-19 relief bill, have been dominated by justifiable outrage on the Left at the eight Democratic senators who voted against including a $15 per hour minimum wage hike. But sandwiched in the $1.9 trillion bill is significant pension relief — the product of years of tireless organizing by Teamster retiree activists.
The bill includes measures from the Butch Lewis Emergency Pension Plan Relief Act, which rescues Central States Pension Fund plans in the form of grants from the US Treasury Department that do not have to be repaid. Pensioners will receive 100 percent of their earned benefits. A whopping $83 billion of the bill’s $1.9 trillion price tag will go toward saving the pensions of over one million workers, including four hundred thousand Teamsters.
Though framed as a COVID-19 emergency relief measure, the pension crisis predates the pandemic and will remain precarious afterward. But this victory shows sustained grassroots mobilization can save our chance at a dignified retirement.
For the Teamsters, the vulnerable state of their pensions can be traced back to a horrible deal negotiated by General President James Hoffa, Jr back in 2008. The five-year contract agreement included concessions that allowed UPS to pull out of the Central States pension plan — leaving forty-four thousand full-time Teamsters’ pensions in the lurch, without funding. Though UPS agreed to a $6.1 billion cash infusion on their way out, this left the fund without a key contributor that kept it financially stable.
Then Congress came in for the kill. In December, 2014, with no public hearings or debate, Congress passed the Multiemployer Pension Reform Act (MPRA) in the middle of the night as part of an omnibus appropriations bill. This legislation allowed dramatic pension cuts (as much as 60 percent of benefits) for retirees enrolled in multiemployer pension plans that are “financially troubled.” It also gave plan trustees total control over how to allocate funds and barred retirees from being able to challenge them in court.
This provocation triggered a new level of organization and militancy from Teamster retirees. “Committees to Protect Pensions” were formed in over twenty cities, using social media as a way to identify and coordinate pensioners. Meetings of up to six hundred activists and family members were held across the country in cities like Columbus, Milwaukee, and Missouri — activity coordinated and sustained by Teamsters for a Democratic Union (TDU), a rank-and-file caucus within the union.
A high point of this movement came in April 2016, when over two thousand retirees descended on the US Capitol to protest the draconian pension cuts of the MPRA. They called instead for implementation of the Keep Our Pension Promises Act (KOPPA), introduced by Senator Bernie Sanders. KOPPA proposed to address the pension issue by providing backup money for the Central States retirees whose companies went bankrupt, funded by closing corporate tax loopholes.
This feverish period of activity resulted in a victory in May 2016 when the Treasury Department denied cuts to the Central States Pension Fund.
Retirees continued to advocate for sustainable pension reform and switched to mobilizing in support of the Butch Lewis Act, which had similar measures to KOPPA. The legislation was named after Butch Lewis, a revered Teamster and TDU activist who fought consistently for pension protection. When he died in 2015, his wife Rita Lewis continued the fight.
This pension relief only happened because retirees organized to keep the issue alive in public consciousness and the halls of power. Multiemployer pension plans’ benefits are often modest and a lifeline for retirees. On average, they amount to $15,000 per year for each beneficiary — hardly the stuff of largesse. Pensions are workers’ deferred pay, not some kind of lavish handout, and no one should ever be able to take them away.
More pension fights are on the horizon. Workers and working-class advocates should use this as a springboard to make pensions sustainable for the long-term. Millennial workers often joke that by the time we’re senior citizens there will be no such thing as retirement or pensions. This is the future the ruling class would love to bring into being if we don’t stop them.
Defined-benefit pensions are quickly becoming a thing of the past for private sector workers, with less than 15 percent receiving them today. These pensions guarantee workers a lifetime benefit based on their salary and years of service. Employers increasingly use defined-contribution plans like 401(k)s, which put workers in the precarious position of depending on a volatile stock market to keep their benefits safe.
This isn’t inevitable. The government always finds a way to bail out banks and corporations when they’re in trouble. The passage of pension relief in the recent stimulus bill proves they can do the same for workers. And Bernie Sanders’s KOPPA legislation provides a vision for how we can sustainably fund workers’ retirement through progressive taxation.
The right to a dignified and secure retirement should be guaranteed for all workers. Just like health care, we should not be dependent on employers to provide this right. Retirees have kicked open the door with this victory. Now all of us have to make sustainable retirement a reality for all.