The Bipartisan Budget Act of 2018 created two Joint Select Committees of 16 members each. One is the Joint Select Committee on Budget and Appropriations Process Reform and the other is the Joint Select Committee on Solvency of Multiemployer Pension Plans.
The goal of the Select Committee on Budget and Appropriations Process Reform is, in the words of the Budget Act, “to reform the budget and appropriations process” in a significant way.
To that end, the Select Committee is to hold at least five public hearings that are to result in “recommendations and legislative language.” Assuming that ten members — five Republicans and five Democrats — are in agreement, the Select Committee will issue a report and proposed legislative language no later than November 30, 2018. The legislation would be transmitted to Congress and cannot be amended. In the Senate, a motion to proceed to consideration of the bill would require sixty votes, would not be subject to points of order, and the vote would have to be taken no later than the last day of the current Congress. In other words, a bill, if there is one, would be acted upon in the lame duck session of 2018.
The procedures and schedule are the same for the Joint Select Committee on Solvency of Multiemployer Pension Plans, which has as its goal “to improve the solvency of multiemployer pension plans and the Pension Benefit Guaranty Corporation.”
There is a clear need for reforming the budget process and improving the solvency of multiemployer pension plans, which are backstopped by the Pension Benefit Guaranty Corporation (PBGC), an independent government agency.
Regarding the current budget and appropriations process, the most honest thing to say is that the United States, the largest economy in the world, does not have one. On April 15, Congress missed the statutory deadline for passing a budget for the next fiscal year. This was not a surprise: Congress has only met this requirement five times since 1985. Additionally, Congress is supposed to pass twelve appropriations bills a year, but over the last 44 years, it has averaged 2.5. This kind of ineptitude and indifference should have set off alarm bells long, long ago.
The multi-employer pension issue is a smaller matter than the US budget and appropriations process but it is serious nonetheless. Multiemployer pension plans are retirement plans negotiated by a union with a group of employers in the same industry. The US now has about 10 million people in about 1,400 PBGC-insured multiemployer pension plans. According to actuary Ted Goldman, about 100 of the plans, with one million participants and beneficiaries, appear likely to fail within the next twenty years. Even if these plans miraculously slip the noose, by 2025 the PBGC pension insurance fund could run out of cash needed to support pension plans it has already taken over or is on the verge of taking over.
No one knows whether either committee will come to agreement and deliver legislation that Congress will pass and the President will sign. But this is Washington and speculation is always the order of the day.