Wednesday, November 16, 2011
U.S. pension insurer's deficit hits record $26 billion
WASHINGTON — The federal agency that insures pensions for 1 in 7 Americans ran the largest deficit last year in its 37-year history.
The Pension Benefit Guaranty Corp. said it ran a $26-billion imbalance for the fiscal year that ended Sept. 30.
The agency has been battered by the weak economy, which has brought more bankruptcies and failed pension plans.
Its pension obligations rose $4.5 billion. The PBGC also earned less money in the stock market, which helps to fund pension plans. Returns were $3.6 billion, half what it earned the previous year.
The agency's director said taxpayers may have to bail out the agency eventually if Congress doesn't raise companies' insurance premiums. He didn't give a time frame.