Bush's Amtrak Proposal Will Exhaust Railroad Workers Pension Fund In 2006!

[Itsthetruth]

AFL-CIO
February 16, 2005

Workers Fighting Bush Plan to Derail Amtrak

For the second time in two years, the Bush administration is trying to kill Amtrak, the nation’s inter-city rail system. President George W. Bush’s proposed budget for 2006 contains no funds for Amtrak, which received a $1.2 billion federal operating subsidy this year.

The White House plan calls for Amtrak’s nationwide routes to be privatized and sold in pieces to private companies or for states to pick up the tab for certain routes with federal matching funds. In text accompanying the budget, the White House predicts that without subsidies, “Amtrak would quickly enter bankruptcy, which would likely lead to the elimination of inefficient operations and the reorganization of the railroad through bankruptcy procedures.”

By placing the entire Amtrak system on the chopping block, Bush also is threatening rail service for 24 million passengers and the jobs and railroad retirement benefits of 20,000 Amtrak workers, Wytkind says. More than 100,000 freight and commuter rail workers would see their payroll taxes go up significantly with 20,000 people no longer paying into the retirement system as Amtrak employees, he says.

Without those Amtrak workers paying into benefit programs, the Railroad Unemployment Insurance Account would be exhausted by 2006, and nearly $297 million would have to be borrowed to make up the loss, says Rep. David Oberstar (D-Minn.), ranking member of the House Transportation and Infrastructure Committee. Oberstar and other congressional Democrats vowed to fight for funding to keep Amtrak trains rolling.

http://www.aflcio.org/yourjobeconomy/jobs/ns02162005.cfm

[HereSince1628]

1. I believe this is really wrong headed...

but then I believe that an interstate system of railroads is important for both economic and defense/security reasons.

[Itsthetruth]

2. This Ties In With The Attack On Social Security

I hope this latest attack by the Bush government on retirement benefits is widely publicized and opposed.

It gives us additional ammunition in the fight against Bush's various plans to undermine Social Security. Bush's plan to destroy Amtrak will exhaust the Railroad Retirement Pension Fund in 2006 and require tax increases to pay promised benefits! This direct frontal attack on railroad workers pensions proves that Bush's plans to "save" and "protect" social security benefits is pure hogwash!

I'll look for some links on how the federal railroad retirement pension plan works and what kinds of investments the fund trustees make. Like social security, railroad workers pay a percentage of their income into the fund. The employers match it.