Guest Post by Martin Armstrong
The Pension Crisis on the horizon is far worse than anyone can imagine. This is the final straw that will break the back of socialism the same as communism fell. Pensions are in a state of crisis for they lost money in stock in the 2007-2009 crash and then sold the bottom shifting to government bonds and then interest rates plummeted when they needed 8% to survive. The management skills have been nonexistent for the propaganda has always been that government bonds present no risk when in fact they are UNSECURED DEBT and the riskiest of all investments long-term.
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Yellow Roadway company is one example of how things have changed. The company was allowed to skip its pension contributions for 18 months. When the company restarted paying again, it was at 25% of the previous rate. The Pension Fund for local 707 began to implode, with roughly 700 workers paying into a fund supporting more than 4,000 retirees. Local 707’s fund pays out $48 million a year — and takes in $7.5 million in contributions. Those who have been contributing will get nothing at all for the contributions. The whole thing is a house of cards that caves in.
We wrote in the Pension Report: “As we approach 2017, everything you once thought was secure for your future will unravel.” Indeed, the Sovereign Debt Crisis and the Pension Crisis start to surface here in 2017.
“This is the final straw that will break the back of socialism the same as communism fell …”
Or maybe expand it as people losing their pensions demand a government solution and bailout, depending on how the solution is approached as it is happening.
In any event, if you’re counting on a pension fund for your retirement, you would be wise to keep a very close eye on it and be ready to act in advance to get your money out of it (if you can) if it looks like it will go south.
“with roughly 700 workers paying into a fund supporting more than 4,000 retirees. Local 707’s fund pays out $48 million a year — and takes in $7.5 million in contributions.”
Just another brick in the wall. All of these Ponzi schemes, creative accounting, stock buybacks, and various other mathematical games are all building. One day, we will wake up and it will be like the morning of 9/11 for the financial universe. NOONE will see it coming of course, but it will hit with the force of a nuclear bomb. That is when the fun really starts.
Unfortunately, there is no voices coming forward (that are being listened to) on this, but they will soon start listening when the volume is simply too loud to ignore. Until then, just prepare, as it is as inevitable as the sun rising that it WILL happen.
Reminds me of a C.S.Lewis quote:
“Pain insists upon being attended to. God whispers to us in our pleasures, speaks in our consciences, but shouts in our pains. It is his megaphone to rouse a deaf world.”
Plan A: things go on as before.
Plan B: Small-scale SHTF, but banks don’t implode.
Plan C: Large-scale SHTF, banks blow sky high.
Plan D: Zombie Apocalypse, dollars fail and barter dominates.
Public pensions won’t make it no matter what, but I bet that private pensions MIGHT make it through Plan B. Plan C takes out private pensions and all insurance contracts, too.
FTR, I don’t prep for Plan D. Doing so is mutually exclusive to being positioned for any of the lesser disaster movies in preview, and I can’t afford a decomissioned missile silo anyway.
While I argue often that Plan A is impossible to continue for much longer, I’d have said the same thing 17 years ago and look where we are. The future surprises everyone when it turns to the present.
I cannot believe a financial services advisor company lost the Teamster’s money. This says as much about what the Teamsters have become as about anything. No one even gets a broken leg?
When resource restriction is recognized, I strongly suspect a lot of money managers who were just doing what their clients wanted (keeping them in risky paper) will be fed into wood chippers.
There promises to be a whole lot of rage when this ship goes Full Poseidon Adventure.
It just ain’t the same as in Hoffa’s days.
O Milken where art thou?
The Dallas pension manager invested in desert land around Tucson. It must’ve looked good in the brochure; imagine a ritzy version of Nogales that in time could become the Palm Springs of Arizona.
I wonder what spooked the cops to cash out of that wonderful pension plan?
Screw those union bullies. Let them spit in one hand and wish in the other; then se which hand fills up first. It is really a shame that the government drone pensions aren’t collapsing as well.
What is the German word? Schadenfreude?
Correction: First of all, America’s government bonds ARE the most secured bonds, they’re United States Bonds, we buy them for our kids and our young relatives. So much for THAT excuse as to why Teamster (truckdrivers) Local 707, went bankrupt.
Y’all forget – or maybe it’s simply that you just haven’t heard – it isn’t just that the Union Members’ Pension Monies are going down the tubes: it’s also the fact that the COMPANIES were permitted BY AN ACT OF CONGRESS, TO IGNORE THE UNION CONTRACTS THAT BOTH PARTIES – workers and companies both – SIGNED AND AGREED TO, which would have kept the Union Teamster LOCAL 707 funded, as it always heretofore had been, from here to eternity!
This then, is part of the ongoing War Against Unions which has always existed in America, and always will, until We The People recognize who the gangs of crooks who steal our Pension monies, really are: Corporate America gone mad – the Congressmen who allow these Grand Theft America’s to continue – and then in fact, sometimes, who set those same (see Local 707) thefts up, themselves– USING THE VERY TAX DOLLARS WITH WHICH WE ALSO PAY THEM, THEIR MONSTROUSLY SWOLLEN AND COMPLETELY UNDESERVED SALARIES) and above all, to which PARTY these crooks will always belong.
What I and millions of other Americans want to know, of course, is when will we take not only our country, but our livelihoods AND RETIREMENTS back, from the crooks whose only wish, ever and forever, is to steal them from us—I guess the question I’m asking, is: what the HELL is wrong with us, when we go – or, more likely, lately, DON’T go – to vote?!
Those members of Corporate America, like Yellow Freight Trucking – now known as Y/R Worldwide: being troubled by their Union contracts, as corporate America always is and most probably always will be – were ALLOWED by this recent Republican Congress, to go bankrupt: and thus, protected by bankruptcy law, from having to contribute their contractual share to the Teamster Union fund. Means that in 2014-15, that while the Union paid its share into Local 707’s Pension Fund, the company: – Y/R CORP WORLDWIDE, suddenly didn’t have to – broke, they certainly were not). Not then, and not any longer, and now people are wondering: “Why did Teamster Local 707 go broke?” And that’s what I’m here to tell you, because I saw it all from start to finish.
The Act of Congress which committed this monstrous rip-off of elderly Union Teamster Retirees was dubbed the:
Kline-Miller Pension Reform Act of 2015.
Now, both Kline and Miller are Congressmen – one a Republican, one a Demo-publican (Dem in name only): one, I believe, from Mississippi(?) and the other from California, I forget which is from where – and they put their names to this murderous Republican Act of Congress, most probably through the stewardship of the current Speaker of the House, – who had, just a year or so before, orchestrated a House takeover which had former Republican House Speaker John Boehner ‘escorted’ out of his position in a sudden unexpected retirement, and himself, Paul Ryan, in the House as Speaker.
And from that came the Act of (Speaker Ryan’s) Congress: which instantly and immediately bankrupted millions of elderly retirees. This animality was called, the:
MULTI-EMPLOYER PENSION REFORM ACT OF 2015.
(MEPRA, for short) – written out over Christmas-New Year Holidays, 2014-2015) which declared that SUDDENLY – Gee, must’ve been the economy, folks, or maybe not enough young workers (LOL!) – there had, somehow, been a huge money-drain draw from Teamster Pension Local 707. And that, of course, was the enormous lie that we all were told, that we are all still being told, and that will always be told unless we kick out the liars who made this Grand American Pension Theft not only possible, but who happily (and greedily, I’d say) helped it to succeed.
THAT, is what bankrupted Teamster Local 707. No, it wasn’t “the economy” or “not enough younger workers” (why? where did they disappear to?!) or any of that claptrap garbage that some ignorant people, try to peddle. It was a deliberate, forced, grab of the Teamster Local 707 Pension Retirement money straight out of the Union Retirees’ pockets, by an Act Of CONGRESS!
That same law, which has most luckless current retirees now living in conditions which would fulfill squalor requirements in any country on earth – the law which stole what they had earned over 40 years of life’s work, Americans working 24/7, leaving their families to go to church on Sunday, and trusting in their country – is called, the:
Kline-Miller Multiple-Employer Pension Reform Fund Act of 2015, MEPRA for short. Yes. An Act of Congress stole our Moms’ and Dads’ retirement monies. The same Congress for whom so many of those same Moms and Dads, had voted for!
That means that “ANON” – for the moment – did succeed. Those ‘socialists’ are currently on their way out, dying from an immensely brief retirement without the money that they themselves, the current retirees who were then (in the 70s, 80s, 90s, up to now) young men – had, innocently, put away to support themselves in their old age.
But once this disgusting excuse for a Congress – (which, by the way, tried, is still trying and will always try, to steal our Obamacare, but that’s a whole other, future story) – once it changes from the Republican Party which now owns it, to one where the People own their own Congress, then watch out, “ANON” It’s not ‘socialism’ (as you call Unions) that’s going away. It’s soon going to be YOU, “ANON”, and forever.
So, “ANON” – you may be correct for now. The country that you are so eagerly trying to destroy – and the ENEMY COUNTRY – RUSSIA -to which you secretly (and desperately) commissioned our 2016 Elections–(which among other things, would have removed this Grand Theft America from the back of those aged and helpless Local 707 retirees) — you may think that, with all that, you have won.
You think that American Unity –that which you call “SOCIALISM” with such disgust, so evident in your words – will continue to shatter, and I’m here to tell you that – mark me well – it will not.
Our beloved family member passed away the other day. He was well-supported by his grateful family since his pension was stolen by the aforementioned Act of Congress in 2015. The theft of his pension – in this case, by the company (Yellow Freight Systems) that he worked for: theft being allowed by that disgusting Act of Congress MEPRA etc: – was, of course, offset by his own three, horrified, grown children. One is in the communications industry, one is in the Military (whose Pensions are also being attacked by certain members of Congress) , and the other in the Emergency Medical Services, also whose pensions (along with Fire and Police Pensions) you “ANON” disgusting thugs, are also trying to remove. “Ooh…those SOSHALISTS! BAD!”
Yes. The wonderful man into whose pockets ANON drove his thieving hands, is now gone. Lucky we both were, to have the wonderful generous children that we had together – but what of others? What of those retirees, who lost their children in Iraq? Is it OK for THEM to walk the streets penniless, because YOU stole THEIR pensions?!
THAT’S what killed Teamster Local 707, and pauperized the elderly retirees, completely hitting them with this Grand Theft America…and, having “won”, now you see the new assaults on “Socialism” being celebrated by people with whom no decent person would willingly associate with.
Yes, they say – “socialism’s finally on the way out” by way of Corporate America’s Congressional Grand Theft America, ripping away what American workers had so proudly contributed to.
That is what happened to take away the retiree living, that Americans had worked and given their lives and contributions to earn. It is NOT that: “the economy tanked”, or even that “there weren’t enough workers” (that last, an outright lie). Retirees were supposed to take their pension cuts, to go away and die quietly, to say “Well, what can you do”….as would anyone else do, whose strength and youth had gone to a lifetime of both building up a corporation AND building up a family.
Many retirees have now died off, and quickly, starved by the cost of food that they would once have been able to (with their pensions entire) sneer about. Imagine – the Middle Class starving in their old age, through no fault of their own – and, at the present moment, the last indignity –after working and giving their youths, middle age and whole life – having to go for government help to save their homes. This was 75 to 80 year-olds.
Imagine, taking their bread along with the homes, of innocent people who had done nothing but create an America by way of their Middle Class, which was the envy of the world.
The law that took Local 707’s pensions, was written over the Christmas holidays in 2014 and signed into law right after New Years’, on @Jan. 5th, when no one was looking. was an assault against American workers, an assault on US, and it is now an integral part of the Republican stripe, never to be removed.
That will continue to be peddled by the contract-breaking companies, as par for the new course undertaken by the almost-complete Republican takeover of this country – most recently underwritten and facilitated by the Russians that these same Republicans profess to abhor and fear. The fact that, all along, these traitors to their country planned to subvert the election that would have brought a new surge of prosperity to America, that isn’t mentioned by the “anti-Socialists”. Of course.
Now, the new cry against working people isn’t “COMMIES!” the way that Republicans used to divide working people back in the 50s and 60s – now, it’s: “SOSHULIZM!” and “GET DEM DIRTY SOSHULISTS!” Of course, what the Republicans are really saying is one thing: that is, in Unity there is Strength, and they will be DAMNED if they allow this country to return to its former heights, when the mantra then was: “A rising tide floats all boats”, and our booming Middle Class, Lack of Poor AND the Rich getting even Richer, was the pride of America and the envy of the world.
Unless We The People start pressing the “D” button, in all its entirety all up and down the voting sheet, instead of the “R” button when we vote, it’s not just the innocent retirees who will see the bottom kicked out from under them – it’s soon going to be the rest of us.
Most pension funds in the US will follow in the footsteps of Local 707 eventually because either they were set up as glorified ponzi schemes to start with or the fed’s ZIRP are preventing them from making any money on their investments.
The shit will really hit the fan when the market tanks the next time. All those risky investments that these funds have been making to get any positive return at all will start returning -50% on their investments. At this point, not only will private funds like 707’s all fail, but a tsunami of government pension funds will go under.
That will be the day of reckoning.
Private first then Public . Good ,I owe these people Nothing . Especially Public Pensions who are nothing parasites.I hate to think this way towards these unions but I do.Was reading an article on another website about Police in one City in Florida ( Orlando if I remember correctly ) where some Public employees were retiring at 48 years of age with Million dollar Pensions.Some of these were worth several million dollars over a lifetime.Hard for a working guy like me to feel pity for these people.
BB, I’d check that one out… Your instincts are completely correct: you say that you hate to think that way about unions, but that you read some article about guys who were retiring from the PD at 48 y/o with Million dollar Pensions, in Orlando, Fla… unless they’re also dealing coke, I would doubt that surely Tall Tale, LOL!
Gee Wish my steelworker pension plan was as good as the U.A.W. plan they were bailed out by TARP at 100 cents on the dollar so why not teamsters or steelworkers ? It’s a big club and we are not in it ! Our shit is shit but their shit is stuff ! I suppose if I need the property tax money to support myself my state will give me a break LOL ! The police state must have their pension funded even if they must resort to theft to fund it and they will !
BWAHAHAHAHAHA!
If’n you have a private pension you can still make healthy annual withdrawals from or one you can withdraw ALL funds from…………I’d get on it PRONTO! 100% of something is far better than 100% of nothing.
60% of something is far better than 100% of nothing
fixed it for you (yes, state by state variances in income tax may move the number, but taxed it will be)