The Recession

Public Supports Guaranteed Pensions

| by AFL-CIO

By Daniel Pedrotty | From the AFL-CIO Now Blog

Nearly nine out of 10 Americans believe that everyone should have access to a
defined-benefit pension plan. Most also support creative
government policies that would help make this dream a reality. These are some of
the findings of a recent national public opinion survey of more than 800
Americans undertaken for the National Institute on Retirement Security (NIRS). On a conference call
announcing the survey results, NIRS Executive Director Beth Almeida said she
hopes that the survey can serve as an opinion benchmark for policymakers as they
attempt to improve the fading retirement prospects of millions of people.

According to the survey, 85 percent of the public view retirement security as
a shared responsibility between individuals, employers and the government.
People believe the three-legged retirement stool of the past, consisting of Social Security, pension plans and private savings, is still
the best approach to meeting retirement needs in the 21st century.
 

According to Almeida, “to restore retirement readiness,”

Americans would be well-served by policies from the new Congress and
Administration that take a comprehensive approach: recognizing that 401(k) plans
can’t do it alone; shoring up Social Security, and re-tooling pensions for the
21st century.

The retirement leg most in need of fixing is the pension leg. It has provided
support to fewer and fewer retirees as employers have replaced, instead of
supplementing, them with defined-contribution plans, such as 401(k) plans.

But as Almeida puts it, people are not looking for grandma’s pension plan.
Since many people today will work for several employers throughout their lives,
pension portability is key. Americans are open to new ways the government might
promote pensions. For instance, the government could help small employers band
together to provide pensions to employees by serving as a plan sponsor or
incubator. Almeida says that today nothing less than a pension renaissance is
needed that simultaneously meets the needs of employers, workers and the
economy.

North Dakota Rep. Earl Pomeroy, who joined the call announcing the survey
results, emphasized how worried people are about their retirement plans as the
economy takes a nosedive.

The market downturn has reintroduced people to the concept of risk and the
defined contribution format places the risk solely and exclusively on the
shoulders of the workers.

He went on to say:

[T]he long-term patient capital role pensions have played in our economy has
been very important as they have invested in businesses, invested in them over
the long-haul.

In other words, the very pensions that Americans believe should be accessible
to everyone could provide the foundation for an economy that works for everyone.

Read More at the AFL-CIO Now Blog.

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