Pension tension: our other retirement time bomb.

• Author: Sanchez, Julian
• Position: Citings - Brief Article

THE DEBATE over Social Security reform has put the retirement program's fiscal woes in the headlines. But public attention hasn't yet fixed on the foundering Pension Benefit Guaranty Corporation (PBGC), the government program that insures private employers' pension programs--and that Sen. John McCain (R-Ariz.) calls a "looming train wreck that could cost the taxpayers of America untold billions of dollars."

In fiscal year 2004 PBGC, which covers more than 34 million workers and retirees, paid out some $3 billion in benefits to pension plan beneficiaries--more than twice what it took in from employers in premiums. The total accumulated deficit of its insurance program came to $23.3 billion, more than double the figure for the previous year.

A March report from the Government Accountability Office found that PBGC's problems aren't just the result of economic bad luck, though recent airline bankruptcies have dumped some hefty new liabilities in the insurer's lap. The report found that...