PBGC's Deficit Triples to $33.5 Billion

Source: Washington Post

The federal agency that guarantees corporate pensions was $33.5 billion in the red at the end of March, triple its deficit six months earlier, the agency's head has told a Senate committee.

The recession threatens to add to the strain on the Pension Benefit Guaranty Corp. by pushing more companies into bankruptcy and leaving the struggling agency responsible for their pensions. For example, the agency faces a potential tidal wave of claims from Chrysler and General Motors, whose pension plans are underfunded by an estimated $29 billion, the Government Accountability Office has warned.

If the PBGC's condition continues to deteriorate, the government could come under pressure to shore it up with taxpayer funds, the GAO has told the Senate's Special Committee on Aging in preparation for a hearing today.

At the same time, acting PBGC director Vincent K. Snowbarger has told the Senate committee that despite the deficit, the PBGC will be able to meet its obligations to pensioners for many years. That's because the payments it owes aren't due all at once; they are spread over the beneficiaries' lifetimes, Snowbarger explained.

Read more: http://www.washingtonpost.com/wp-dyn/content/article/2009/05/20/AR2009052000778.html?hpid=topnews

Congress only cares about Wall Street. And if a company goes bankrupt, well, it's no longer part of Wall Street. It's Main Street. And so it will get nothing. Unless someone on Wall Street wants it. Then of course it will be bailed out and sold quickly to the lowest bidder.