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January 27, 2003
Insurer of Pensions Out of Money
As companies go bankrupt, the guaranteer of pensions for their workers, the Pension Benefit Guaranty Corporation, is now running a deficit, a number that is only going to get worse as more prominent companies go bankrupt.
Overall across the country, it is estimated that companies owe $300 billion more in pension obligations than they have funds saved for that purpose.
The PBGC is funded by assessments on individual pension funds (sort of like deposit insurance) but a government bailout on the scale of the savings & loan crisis could become an inevitability.
Posted by Nathan at January 27, 2003 08:51 AM
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