WASHINGTON – Pumping his fist, Minnesota congressman Rick Nolan led 1,000 retired Teamsters in a roaring chant: “Stop those cuts! Stop those cuts!”
Nolan was among more than a dozen politicians — including Minnesota Sen. Al Franken — who took to the West Lawn of the Capitol Thursday to decry a Central States Pension Fund proposal to slash retirement checks to 272,600 members of the Teamsters union.
Nolan, a one-time Teamster who represents the state’s labor-friendly Iron Range, went a step further than most speakers. He told the crowd that after meeting with the government-appointed lawyer deciding whether to allow the cuts, he was “cautiously optimistic” the cuts would be rejected.
A decision from the Treasury Department is due by May 7.
The Central States fund is vastly underfunded because of investment losses suffered in the Great Recession and because shrinking union membership has left many more Teamsters drawing retirements from it than are contributing to it. By some estimates, the fund will be insolvent within a decade.
But first-of-their-kind cuts ranging up to 70 percent have drawn national attention, and calls for alternatives to the law that Rep. John Kline, R-Minn., helped attach to the federal budget in 2014.
Joining more than a dozen Democrats on the D.C. dais were Sens. Charles Grassley, R-Iowa, and Rob Portman, R-Ohio. Their support shows an 11th-hour coalescing of opposition to the parliamentary move in 2014 by Kline and retired Democratic congressman George Miller of California. The tactic, which ensured the pension reform act was not debated or voted on as a separate bill, raised the ire of virtually every speaker at the two-and-a-half hour Washington rally.
“This legislation went through in the dead of night,” Portman told the crowd.
Sen. Heidi Heitkamp, D-N.D., called it a “secret deal.”
The event coincided with a protest at Kline’s Second Congressional District office in Burnsville. About 200 angry Teamsters gathered on the sidewalk in front of Kline’s office carrying signs reading “Stop the pension cuts.”
Cars honked in support as union leader Bob McNattin spoke. McNattin, 77, said he is unable to support himself on his pension, and still works as a truck driver.
“We’re going to overturn this damn law and get our pensions back,” McNattin said.
Anticipating the protest at his Minnesota office, Kline issued a statement Wednesday calling the pension crisis “a painful situation for many families and retirees,” but warned that “those who continue to spread misinformation and false hope are promising to make the pain even worse.”
Thomas Nyhan, executive director of the Central States Pension Fund, issued a statement saying the proposed benefit reductions are the only way to save the fund.
“This is a gut-wrenching decision that we do not take lightly,” Nyhan said. “If there were any other realistic alternatives to reducing benefits, we would have pursued them.”
“To Members of Congress and interest groups who oppose Central States’ proposed rescue plan, we ask one fundamental question: What is your realistic alternative to the proposed rescue plan?”
Among the Minnesotans who trekked to Washington, D.C., for the protest was Les Spencer, a 67-year-old truck driver from East Bethel, Minn. He endured a 16-hour bus ride that required “a lot of Advil so you didn’t get paralyzed.” He called Kline’s actions “insubordinate.”
“En masse like this, you open some eyes,” he said. “They need to have congressional meetings on this.”
The people it hurts
Spencer faces a 51 percent reduction in his pension payments. He stood beside his 70-year-old brother, Roger, who expects a similar cut.
“We bail out banks and big car companies,” said Roger Spencer, who lives in Center City, Minn. “Can we work something out for working people?”
The answer to the question may lie in the application of the Kline-Miller law, which requires the Treasury Department to approve pension cuts to financially strapped funds in order to keep them solvent.
After his speech, Nolan told the Star Tribune that meetings he attended with Kenneth Feinberg, the lawyer appointed to oversee troubled multi-employer private pension plans, indicated that the government may be willing to nix the current cuts to get a plan more likely to save the Central States fund.
Franken supports a bill sponsored by Sen. Bernie Sanders, D-Vt., that shores up ailing pension plans with a tax increase on the country’s richest citizens.
Responding to a request by Grassley, the Government Accountability Office is now investigating the Labor Department’s long-running oversight of the Central States fund and the fund’s investment decisions. It is expected to shed light on what led to the retirement fund’s failure.
Meanwhile, talk of possible alternatives to benefit cuts and even low-interest loans to prop up the Central States fund filtered through the Washington crowd Thursday. And Steve Baribeau, 65, of St. Paul gave voice to the worst fear of every retiree facing a dramatic reduction in retirement pay.
“I’ve got diabetes and a bad knee,” Baribeau said. “I don’t know if I could go back to work.”
Staff writer Jennifer Bjorhus contributed to this story.
Zoe Peterson is a University of Minnesota student reporter on assignment for the Star Tribune.