Biden to announce $36 billion for ailing teamsters’ pension fund

President Joe Biden will announce a $36 billion bailout for the Central States Pension Fund, helping to shore up one of the nation’s biggest multiemployer plans and delivering help to union allies after a contentious rail deal that frayed ties with organized labor.

Biden will be joined by International Brotherhood of Teamsters President Sean O’Brien, AFL-CIO President Liz Shuler and Labor Secretary Marty Walsh at an event Thursday to promote the aid, according to a White House statement, which called the assistance “the largest ever award of federal financial support for worker and retiree pension security” and the largest from a program created by Biden’s pandemic relief law, the American Rescue Plan.

The president angered some of his labor allies last week by signing legislation imposing a contract he personally helped to negotiate between freight railroads and their unions, averting a possible strike that threatened to cripple the economy. Rank-and-file union workers, however, opposed the deal. Four of the 12 unions involved in the negotiations — representing roughly 54,500 workers — rejected the contract.

The president called the decision “tough for me” at a signing ceremony and said labor would need to wait to obtain more sick leave, a key sticking point in the talks. Biden has called himself the most pro-union president in US history and labor activists have long proven to be key political allies for the president and his Democratic Party.

Central States is largely made up of workers and retirees from the Teamsters. The White House said that without the financial support, 350,000 union workers and retirees would have faced retirement benefit cuts estimated at 60% over the next few years.

The pandemic-relief bill Biden signed in March 2021 allows some financially troubled multiemployer plans to apply for assistance. The White House said the program would help more than 200 multiemployer plans, keeping the pension plans of 2 to 3 million workers solvent and paying benefits through at least 2051.

The White House said the Central States bailout would help 40,000 workers and retirees in Michigan, 40,000 in Ohio and 22,000 in Wisconsin — three key political battleground states. Republicans have criticized the pension bailout provision of Biden’s relief law, saying it had nothing to do with the pandemic and was simply a handout to the president’s union allies.