President Obama’s plan to strengthen PBGC by setting fairer premiums continues to attract media attention. Below are recent news stories and editorial commentary:
August 26, 2011, Washington Times editorial: "Letter to the Editor: PBGC Needs Reforms, Not a Taxpayer Bailout" by Josh Gotbaum
July 11, 2011, Pensions & Investments editorial: "Proposal Will Strengthen Corporate DB Plans. Reward, not Punish, Sound Companies" by Josh Gotbaum
April 23, 2011, Boston Globe editorial: "To avoid bailing out pensions, Congress must raise premiums"
April 22, 2011, Reuters: "Obama plan to shore up pension insurance fund stirs controversy" by Mark Miller
April 15, 2011, Washington Post editorial: "A just plan for getting PBGC more revenue"
About Fair Premiums
The President's proposal would allow PBGC to set its own premiums based on the financial health of the employer and the circumstances of the individual plan. Historically, Congress has raised PBGC premiums by legislation without taking a company’s individual circumstances into account. As a result, financially sound companies are forced to subsidize those that are not.
PBGC has never received taxpayer funds. To help the agency meet its obligations, Congress has repeatedly raised premiums. At least two bipartisan budget review groups, the Simpson-Bowles Commission, and the Domenici-Rivlin Commission, have recommended that PBGC's premiums be raised again. The President's proposal allows for premium increases that are fairer to the business community and encourage preservation of pension plans.