Key House Republicans boycott pension meeting

[Omaha Steve]

Full story: http://money.excite.com/ht/nw/bus/20060728/hle_bus-n27175437.html



Friday July 28, 1:09 AM EDT

By Susan Cornwell

WASHINGTON (Reuters) - Legislation to overhaul the U.S. private pension system suffered another setback on Thursday as key House Republican lawmakers boycotted a negotiating meeting in a fight over whether to keep some $35 billion in tax breaks in the bill.

A furious Sen. Charles Grassley, Republican of Iowa, denounced the no-shows from the House as "scaredy-cats." But the chairman of the House of Representatives and Senate pension negotiating team, Wyoming Republican Sen. Mike Enzi, said he intended to keep talking to all the negotiators to seek a deal on the bill.

"I was just wondering why you wouldn't have guts enough to come forth and cast a vote," Grassley fumed as he looked around a half-empty conference table in a Senate office building.

Progress on the bill to overhaul the troubled traditional pension system was delayed earlier this week when Grassley and other senators rebelled against plans by Republican leaders in both the House and Senate to strip the bill of popular tax breaks for businesses, education and research.

The array of tax breaks includes deductions for certain tuition costs, state and local sales taxes in areas where there is no state income tax, and tax credits for companies' research and development costs.

House Speaker Dennis Hastert and Senate Majority Leader Bill Frist want to take these popular tax cuts and pair them with a more contentious Republican plan to cut the estate tax. The estate tax cut has failed repeatedly to pass the Senate.

[xchrom]

1. this article make sit sound like grassley is a friend of the people.

he is not.

there is no such thing breathing.

[Robbien]

2. The idea of these guys touching pension laws again scares me

Every bill put forth to date by the GOP has benefited corporates and hit the middle class hard.

No more reforms please, we can't afford it.

[fasttense]

3. Well, there goes our pensions. Anything they touch they destroy.

You can bet they will make it so the rich can raid our pensions anytime it moves them. Instead of a Laissez-faire government, we have a lazy government that supports the rich.

[Lasher]

4. Cash Balance Plan Conversions

The House version of this legislation might retroactively legalize conversions from more traditional Defined Benefit Pension Plans to Cash Balance Plans.

http://www.ballardspahr.com/press/article.asp?ID=829

A federal district court ruled IBM's cash balance and pension equity formulas violate ERISA's age discrimination prohibitions. Cooper, et al. v. The IBM Personal Pension Plan, et al., Civil No. 99-829-GPM (S.D. Ill. July 31, 2003). The district court ruled cash balance formulas are inherently age discriminatory because identical interest credits necessarily buy a smaller age 65 annuity for older workers than for younger workers due to the time value of money. Until now, that controversial position had been limited to cash balance critics and some academics.

That decision has been appealed by IBM, and a decision on that case by the Seventh Circuit Court of Appeals is expected some time this year.

http://en.wikipedia.org/wiki/Cash_balance_plan

Here is the text of a July 20 letter I sent to Senator Jay Rockefeller, who is on the conference committee:

I am very concerned about the direction the Pension Reform Conference
Committee is taking in supporting the House bill on Cash Balance Plans.
It has been reported that this is indeed the case despite the fact that
the House language does not protect older workers. The language in the
House bill dealing with Cash Balance Plans is too broad and open-ended.
Its inherent vagueness leaves open the potential for age discrimination
and abuse by employers. The House bill also fails to protect older
workers as they transition from a Defined Benefit Pension Plan to a Cash
Balance Plan. Conversely, the Senate bill, S. 1783, does support older
workers and would provide the necessary protection these workers need.

Older workers are depending on you and all of the conferees to protect and
support them in conference. Please support S. 1783 and oppose the House
bill on Cash Balance.

[antigop]

6. Yes, the House bill legalizes cash balance pensions prospectively

>>
The House version of this legislation might retroactively legalize conversions from more traditional Defined Benefit Pension Plans to Cash Balance Plans.
>>

The Senate protections for older workers need to be in that bill. Otherwise, they will get screwed.

[Gman]

5. Are these Clinton era tax incentives

they want to strip out?