OPINION:
Would you board the Titanic — while it was sinking?
Dozens of labor unions are asking workers to do just that, but instead of a ship, they’re trying to fund their underwater pension funds. Remarkably, they don’t have to disclose their dire financial straits to the nonunion workers they’re trying to organize, letting them pretend the Titanic hasn’t hit the iceberg even as it takes on water.
Workers deserve to know if they’re going to go down with the ship. Last month, Sen. Bill Cassidy introduced federal legislation to provide the necessary transparency. The Making All Fund Information Available Act — the MAFIA Act, for short — would force labor unions to tell nonunion workers if their pension plans are headed toward the ocean floor. This information is critical to ensuring that workers make informed decisions about unionization and protect their financial futures.
Pension funds representing hundreds of thousands of unionized workers are in sorry shape. The federal government deems 25 plans as “critical and declining,” 29 as “critical” and 13 as “endangered.” There are many reasons so many plans are failing, not the least of which is declining union membership. There simply aren’t enough current workers to cover the costs of retired union members.
Nor does it help that unions like the Teamsters use their pensions to support things like ESG (economic, social and governance) investing. They’re putting political objectives above the financial interests of pension participants and retirees. That further threatens investor returns, putting added pressure on pension fund stability. And when some pension plans fail, the government guarantees many unionized workers only up to $12,870 a year. That’s a far cry from what unions promise workers who agree to unionize — and even their nonunionized counterparts.
Unions know their pension plans are in serious trouble. The Teamsters have already begged the Biden administration for a $36 billion bailout. At least $127 million of that money went to about 3,500 dead recipients, which was returned only after Sen. Cassidy, Louisiana Republican, investigated the “wrongfully obtained funds.” Yet other union pension plans are still on the road to failure, and no amount of taxpayer money can paper over the underlying challenges they face.
Unionizing more workers will help pension plans survive longer. Yet unions have an unfair advantage when they target new groups of workers. They can paint a rosy picture of a utopian retirement without ever acknowledging that their pension plan may be headed toward a nightmare scenario. It’s the definition of deception, letting unions mislead workers instead of giving them the truth.
Workers deserve to know a union’s true motivations. If its finances are in jeopardy, a union shouldn’t be allowed to neglect to mention it while claiming to look out for workers’ interests. The MAFIA Act would make the facts clear. When a union organizer sits across the table from a nonunion worker, they would have to disclose the state of their pension plan. If it’s a disaster, that will open the worker’s eyes, instead of letting the union blind them with promises that will never pay off.
Federal law already recognizes the importance of transparency. Unions are legally obligated to tell their members when their pensions are at risk. So why shouldn’t they be forced to tell the workers they want to unionize? If the people whose financial future is already in jeopardy get to know, then the people who are being asked to sign up for the same fate should know, too.
The MAFIA Act would help workers know yet another risk of joining a union. More and more union pensions, like the Titanic, are sinking. The last thing workers need is for unions to trick them into climbing aboard.
• F. Vincent Vernuccio is president of the Institute for the American Worker.
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