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Police Called Over Pension Bill Boycott
Provided By: The Associated Press
Last Modified: 7/18/2003 3:18:49 PM
WASHINGTON (AP) -- A House committee on Friday approved a $50 billion pension bill that would allow Americans to put more tax-deferred income into personal retirement accounts, but only after the Republican chairman summoned police in the midst of a Democratic boycott and protests over the way the measure was being handled.
The legislation, which over the next 10 years would also allow retirees to wait longer to draw money from their retirement funds, was approved by Republicans while Ways and Means Committee Democrats were huddled in an adjacent room. It could be considered by the full House next week.
Committee Chairman Bill Thomas, R-Calif., summoned police because he thought the lone Democrat to remain in the room, Rep. Pete Stark of California, was speaking out of line, other Republicans on the panel said. He asked police to remove Democrats from the adjacent room, but later rescinded that request, the Republicans said.
Assistant to the Sergeant of Arms Donald Kellaher, called in to mediate, said that "clearly the police in this circumstance have no role or authority to intervene."
Democrats were upset because they said the final version of the 90-page bill was circulated around midnight Thursday and they weren't given sufficient opportunity to study it before Friday's meeting.
Democrats, who have long clashed with Thomas over what they say are his autocratic practices, said they would consider filing a complaint against Thomas and his staff for filing a false report of a disturbance.
But Rep. Jim McCrery, R-La., a committee member, said Democrats were even less considerate of minority rights when they were in power. The Democratic argument that Republicans are undemocratic has "been their story for a long time and they're sticking to it."
The legislation to extend the age for drawing pension money is part of a broader bill designed to encourage individuals to save more for retirement.
Bill sponsors Rob Portman, R-Ohio and Rep. Benjamin Cardin, D-Md., want to boost the age at which individuals must start withdrawing money from their retirement accounts from 70 1/2 to 75.
The current age was set in 1962, and they hope to update it to reflect the longer life expectancy of retirees.
The bill would also expand a tax credit designed to encourage savings in low-income households and speed already planned increases on retirement account contribution limits. Individuals would be allowed to put up to $5,000 in their individual retirement accounts and up to $15,000 in their 40 (k) accounts each year beginning in 2004.
Lawmakers will also consider changing the way companies measure their future obligations to retired workers under the 32,000 traditional pension plans offered by private employers.
A change in calculations for traditional, defined benefit pension plans would replace the 30-year Treasury bond as the basis for calculating defined benefit obligations. The government stopped issuing new 30-year bonds in 2001, and a temporary measure that simulates the 30-year bond rate will expire at the end of this year.
Portman and Cardin want to replace the 30-year rate with a long-term corporate bond rate to measure pension liability for three years, while the Congress and the Treasury Department collaborate on a permanent solution.
"The way we are doing it is a responsible approach to the current economic situation," Portman said.
The bill ignores a Treasury Department proposal that would have used high-quality corporate bonds to measure pension liabilities for two years, followed by a formula that takes into account the demographics of a company's work force.
That formula drew criticism from businesses and workers worried that it will introduce too much volatility in pension plan funding and discourage companies from establishing or continuing pension benefits.
Many traditional pensions currently face funding shortfalls. More than half of employer-sponsored plans are underfunded by a total of $300 billion, the Pension Benefit Guaranty Corp. told Congress in April. The Pension Benefit Guaranty Corp. insures the plans and assumes some of the obligations of failed plans. |
