Pension Bill Author Wary of Airline Aid
Rep. John Boehner (R-Ohio), the main sponsor of the pension bill (H.R. 2830, "Pension Protection Act of 2005"), said yesterday he did not want any special airline aid added to the measure as it progresses in the House of Representatives, Reuters reported. Rep. Boehner said he intended to keep the pension bill free of specific relief for any particular industry, although he did not rule out such action in the Senate or later in the legislative process, when the two chambers negotiate a single bill for final passage. Boehner's legislation, which passed the House Employer-Employee Relations Subcommittee by voice vote yesterday, would require companies to fully fund their pension plans within seven years. But some airlines are lobbying Congress to incorporate provisions into the legislation that would specifically help their industry by increasing from 10 to 25 years the time they would have to cure their pension fund arrearage.
Congressional auditors said that even if Congress did allow airlines to space out pension contributions, it would not solve their long-term financial problems. "This is a severe crisis in liquidity for all the (airline) carriers, and the pension (problem), while it's real and severe, is only about one sixth of that problem," said JayEtta Hecker of the Government Accountability Office.
In addition to making companies fund up their pension plans, Boehner's bill also requires companies to pay higher insurance premiums to the Pension Benefit Guaranty Corp (PBGC). The PBGC has a $23.3 billion deficit and nationwide pension underfunding stands at $450 billion, the newswire reported. Boehner's bill would also change the threshold at which companies with the worst-off pension plans are required to disclose details of those plans to the PBGC.
Leading Index of Consumer Spending - June 2005
Despite broad speculation about a housing bubble, real median home prices were up a modest average of 1.8 percent during February, March and April compared with a year earlier, according to Deloitte Research’s Leading Index of Consumer Spending. “There has been much discussion recently about a housing bubble, but the truth is that home price appreciation has slowed considerably in the past three months. The time to talk about a bubble was last December,” says Carl Steidtmann, chief economist of Deloitte Research and author of the monthly index. “Consumer spending growth in the summer months will be largely dependent on the direction of home prices and job growth,” continued Steidtmann. “As job growth continues to accelerate, we should see a corresponding pickup in real wage growth.”
Highlights of the index, which tracks consumer cash flow as an indicator of future consumer spending, include:
- After a year of modest declines, real wages now appear to be declining at an accelerating rate, as rising energy prices push up the cost of living and rising benefit costs hold down wage increases. In May, real wages were down 1.1 percent from a year ago.
- Initial unemployment claims fell in May by approximately 10,000 claims per week, helping to offset the weaknesses in other components of the index.
- Home price appreciations have slowed sharply, despite volatile housing markets on the East Coast and in Florida.
- The tax burden has risen slightly since March 2004 as continued economic growth pushes some households into higher income brackets.
The index, comprising four components -- tax burden, initial unemployment claims, real wages and real home prices –- fell in May to 3.80 percent, from a downwardly revised gain of 3.98 percent in April.
Consumers’ Confidence in Economy Slips
Consumer confidence fell slightly last week, according to the latest ABC News/Washington Post poll, the Associated Press reported. The consumer confidence index fell 1 point to negative 10 in the week ended June 19, from negative 9 a week earlier.
According to the survey, 38 percent of respondents expressed confidence in the economy, down from 39 percent the week before. Also, 58 percent of those polled said their finances were in good standing, down from 59 percent in the prior week. In assessing the buying climate, 39 percent of respondents said it was good, unchanged from a week earlier. The index measures typical Americans’ confidence in three areas: the national economy, their own finances and their willingness to spend money, according to the report.
“Best of ABI” Audioconference Features Judges on the New Law
ABI will present the third in a series of "Best of ABI” audioconferences, “Judges’ Roundtable – The New Bankruptcy Law," on June 29, 2005, at 3:00 pm (ET). The panel of experienced bankruptcy judges from four different circuits will discuss the coming significant changes in business and consumer bankruptcy law. The panel was the top-rated program, as selected by the record crowd at the Annual Spring Meeting in Washington, D.C. The program is 90 minutes. To register, click here.
Register by Tomorrow and Save on ABI’s First Annual Mid Atlantic Bankruptcy Workshop
Make plans to attend ABI’s First
Annual Mid Atlantic Bankruptcy Workshop,
to be held August 4–6 at the Hyatt Regency Chesapeake Bay in Cambridge,
Register by tomorrow, June 24, and save $50 off the regular registration rate. This workshop brings together the region’s preeminent insolvency
professionals for three days of hands-on learning, offering up to 9 hours
of continuing education credit. Topics this year include the latest on
the retention of professionals, asbestos cases after Combustion Engineering,
planning bankruptcy cases, Section 363, receiverships and other alternatives,
professional liability, understanding diverse options and selected ethical
Plenty of networking opportunities are planned including a welcome reception,
crab feast dinner, golf, tennis, sailing, sporting clays tournament and much
ABI World Tutorial Highlights Discussion Groups
new online tutorial focuses on ABI’s discussion groups. The tutorial features a visual demonstration of how to sign in and use the online discussion groups. This is the second in a series of tutorials that will highlight the many resources and services that are available at the ABI
World web site.
Latest Job Postings at ABI Career Center
Check out the ABI
Career Center. The Center is a one-stop site for job seekers and employers
in the insolvency community. Career Center resources are available free
to both employers and job seekers. New positions are featured daily. The
latest listings include: