The Teamsters’ “Sinking Ship”—the Central States Pension Plan—is sinking even deeper as it continues to lose $2 billion per year, according to a new report.
Back in 2015, Thomas Nyhan, the Executive Director and General Counsel for the Teamsters’ Central States Pension Plan, issued stunning numbers on just how bad the Teamsters biggest pension fund was underfunded, when he told plan participants:
Baby Boomers are retiring in record numbers and the union workforce has been steadily declining for years. As a result, the Fund currently has more than three times as many retirees as active members — so fewer contributions are coming in than benefits being paid out. To put this into perspective, for every $3.46 that the Fund pays out in pension benefits, only $1 is collected from contributing employers, which results in a $2 billion annual shortfall. [Emphasis added.]
According to an analysis of the ISC report by the Teamsters for a Democratic Union, the TDU notes that the pension fund lost “$172 million for the quarter ending March 31, 2018.”
“However,” the TDU notes, “the loss would have been much worse except for a one-time payment of $467 million by the Kroger Corporation; this was a lump sum payment to pull all Kroger and some Kroger-contractor employees out of the pension fund permanently.”
Although the loss of $172 million is bad enough, what should be most alarming is that, despite the rise in the stock market and overall health of the U.S. economy, on page of the ISC report, it states that the fund is still losing $2 billion per year.
Since that time, hundreds of companies that were part of the Teamsters Central States Pension Fund have closed their doors.