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Politics : Stockman Scott's Political Debate Porch -- Ignore unavailable to you. Want to Upgrade?

To: surfbaron who wrote (3307)	7/26/2002 1:53:24 PM
From: stockman_scott	Respond to of 89467

Pension Plans Shortfalls Hit Record By LEIGH STROPE 07/26/2002 10:13:08 EST WASHINGTON (AP) - Shortfalls in private companies' pension plans soared to $111 billion last year, the highest level ever reported by the Pension Benefit Guaranty Corp. That was four times the $26 billion shortfall that companies reported for 2000, according to the PBGC, the government's insurance program for private workers' pensions. A shortfall is the amount of money that would be owed to pension participants if a plan was terminated. The disclosure of record pension shortfalls comes at a time when corporate scandals, from Enron to WorldCom, are rocking Wall Street, shattering investors' confidence. Congress sent legislation to President Bush on Thursday creating stiff penalties for corporate fraud and document shredding in hopes of easing the economic jitters. "The implications of such massive shortfalls in pension funds are staggering," said Rep. George Miller of California, the top Democrat on the House Education and Workforce Committee. Miller urged the Bush administration to investigate and ensure that workers' retirement savings are not in danger. But PBGC spokesman Jeffrey Speicher said the shortfall is "not as dire an indicator that you might think." All companies with employer-sponsored pension plans are required to file a report with the government when a plan's unfunded liability hits $50 million or more. But in reality, those plans, on average, are still at least 80 percent funded or more, Speicher said. "It's a volatile number and it fluctuates due to various factors, such as interest rates and the performance of plan assets in equities markets," he said. "These plans on average are still well-funded." Also last year, the PBGC paid more than $1 billion in total benefits to almost 269,000 people, the first year ever that payouts topped that amount. The government corporation in 2001 took over 104 terminated single-employer plans covering almost 89,000 people. So far this year, PBGC has taken over plans covering 140,000 participants. In March, PBGC had its largest pension takeover ever, assuming control of three underfunded retirement plans covering 82,000 workers and retirees of bankrupt steel company LTV Corp., whose pension plans were about $2.2 billion in the red. PBGC protects the benefits of about 44 million participants and beneficiaries in slightly more than 35,000 ongoing defined benefit pension plans. PBGC was created in 1974 to insure payment of basic pension benefits of more than 44 million American workers and retirees. It is financed largely by insurance premiums paid by companies that sponsor pension plans and by PBGC's investment returns. Participants of a plan taken over by the PBGC receive, on average, about 94 percent of the benefits they had earned. __ On the Net: Pension Benefit Guaranty Corp.: pbgc.gov

To: surfbaron who wrote (3307)	7/26/2002 3:53:02 PM
From: Rascal	Respond to of 89467

Different. Think of fees and expenses!

To: surfbaron who wrote (3307)	7/26/2002 4:15:11 PM
From: stockman_scott	Read Replies (1) \| Respond to of 89467

Bush to combat investor crisis with economic forum By Adam Entous WASHINGTON, July 26 (Reuters) - The White House said on Friday President George W. Bush will convene an economic forum in August, part of a pre-election push to shore up confidence in his handling of the U.S. economy after a wave of accounting scandals sent the stock market plunging. White House spokesman Ari Fleischer said the Aug. 13 forum in Waco, Texas, will bring together government policymakers, economists, small investors, business owners and union leaders "to discuss the fundamentals of the American economy and to talk about the president's agenda to increase growth for the future." But the event falls short of the bipartisan economic summit that Democrats have sought to boost growth, combat corporate corruption and improve investor sentiment in hard-hit U.S. financial markets. The White House will decide who participates in the event, and has made clear that Democratic leaders in Congress will not be on the list. With their leaders excluded, Democrats said the forum would do little to boost investor confidence. "I'm sure it will be a nice event," said Kori Bernards, a spokeswoman for House of Representatives Minority Leader Richard Gephardt, a Missouri Democrat. "But what we need is a serious economic summit in which Democrats and Republicans sit down and come up with a plan to get this economy back on track." Bush's forum will take place ahead of the Securities and Exchange Commission's Aug. 14 deadline for the largest publicly traded U.S. companies to certify their most recent annual reports and subsequent quarterly reports. Administration officials have sought to play down fears that the deadline will prompt a flood of earnings restatements. "One of the things the American people are looking for from corporate America is honesty, accountability and certainty. And that deadline set by the Securities and Exchange Commission will help deliver that," Fleischer said. BUSH UNDER FIRE Bush and his Republican allies in Congress are under fire from Democrats for their response to accounting scandals that have eroded investor confidence and fueled a sharp drop in stocks. With polls showing his public standing being threatened for the first time since the Sept. 11 attacks, Bush has embraced legislation that would increase oversight of auditors and impose tougher penalties for corporate misconduct. Bush is expected to sign the bill into law early next week. Fleischer said he expected at least six members of Bush's Cabinet to attend next month's economic forum as part of a broader effort by Bush and his top advisers to shore up confidence in his economic stewardship. The forum, Fleischer said, will focus on Bush's pending economic proposals, including bills that would boost his ability to negotiate new trade pacts and make the government a backstop for insurers in the event of another terrorist attack. Bush also will press for passage of Republican-backed pension protections for workers. "There are still many items left pending in the Congress that can help give the economy even a stronger boost than it's currently receiving," Fleischer said. He said participants also may look at "new ideas" to boost the economy. White House budget director Mitch Daniels said on Wednesday that Bush will consider new measures to increase growth if the economy takes a turn for the worse. Some Republicans and business groups favor a capital-gains tax cut to encourage investors to get back into the stock market. Bush is under pressure from fellow Republicans to respond more aggressively to the nation's economic woes. If public confidence in the economy continues to waver in the run-up to the November congressional elections, analysts said it would be a huge boost for Democrats, who blame the reemergence of deficits on Bush's $1.35 trillion tax cut. Republicans counter that the tax cut helped the United States recover from the twin shocks of a recession and the Sept. 11 attacks. They blame a surge in government spending advocated by Democrats, not lower taxes, for the red ink.