I’d like to thank the Chairman for holding this important hearing. As he knows, Republicans enacted many improvements to our nation’s pension laws in 2006. The Pension Protection Act was a bipartisan piece of legislation that garnered the support of many current and former Democrats on this Committee, including that of now-White House Chief of Staff Rahm Emanuel. I think it is important that we continue that bipartisanship as we move forward on an issue so critical to the retirement security of working Americans.
Earlier this year I, Republican Leader John Boehner, and several of my Republican colleagues on this committee introduced the Savings Recovery Act to help Americans rebuild their retirement, college and savings accounts. Among the provisions we offered was an effort to stabilize worker pensions and help employers invest in the future by temporarily providing a softer glide path for recognizing losses in defined benefit plans and provide two additional years to resolve pension funding shortfalls.
The issues surrounding the funding of future retirement benefits are complex for companies, for Congress, and certainly for workers. Given the severity of the economic downturn, Congress should proceed carefully in order to find the right balance between the concerns of workers, retirees, employers, and taxpayers.
While giving companies additional breathing room to meet their pension obligations may make sense on the surface, we must also recognize that too much latitude could erode the likelihood of workers receiving the full benefits they were promised and could further expose taxpayers to the costs of bailing out the PBGC. On the other hand, a failure to provide temporary relief to these plans from the choke hold the global economic downturn and credit crisis have placed on American employers could result in more bankruptcies and the dumping of pension plans on the Pension Benefit Guaranty Corporation – which is already on precarious financial footing and could easily be pushed over the edge.
Clearly, we have our work cut out for us, and I am sure the excellent witnesses today will help us better understand the narrow tightrope we need to walk.
Before I yield back, I want to take just a moment to discuss the issue of investment advice. Access to high-quality, professional investment advice is crucial, especially given the recent upheaval in the stock market.
While proper safeguards should be maintained to protect against potential conflicts involving the compensation of participants’ financial advisers, Congress should not impose unwarranted restrictions that limit the availability of investment advice.
According to some estimates, the proposed restrictions on investment advice contained in the Education and Labor Committee’s bill (H.R. 2989) could cause as many as 20 million 401(k) participants to lose access to the investment advice these working families rely on to help them save for the future in this unsettled economy. Americans don’t need less help getting through these turbulent times; they need more help and it is our job to ensure Americans have access to the quality financial advice they need.
With that, I yield back my time.