Stern leaves SEIU in debt
Andy Stern, (former) head of the SEIU and most frequent White House visitor, surprised just about everyone by announcing his resignation as president of the union. Maybe this should not have been such a surprise as this story (from the Washington Times) reports Stern has left the union deeply in debt.
Purple may be the official color of the Service Employees International Union (SEIU), but Andy Stern is leaving the union deep in the red. Last week, he surprised the labor community by announcing his resignation as president of SEIU. Mr. Stern has claimed victories in helping pass health care legislation and getting President Obama elected, but his impact within his own organization shows gaping budget deficits and massive underfunding of pensions.
SEIU is $85 million in debt, down from its 2008 high of $102 million, and has been forced to lay off employees. Mr. Stern has led protests against Bank of America, calling for the firing of Chief Executive Ken Lewis. Yet the union owes $80 million to Bank of America and $5 million to Amalgamated Bank, which is owned by the rival union Unite-Here.
SEIU’s pensions are in even worse shape. Both of SEIU’s two national pension plans, the SEIU National Industry Pension Fund and the Pension Plan for Employees of the SEIU, issued critical-status letters last year. The Pension Protection Act requires any pension fund that is funded below 65 percent of what it needs to pay its obligations to inform its beneficiaries of the deficit.
It might just be that Stern figured that he might just get the hell out while the gettin’ is good. While SEIU member pensions may be in jeopardy, Stern will not have to worry about that.
Do not worry about Mr. Stern and other high-ranking SEIU officials, though. At age 59, he has 37 years of service in the SEIU and is entitled to a full pension and lifetime health benefits. Unlike SEIU’s pension plans for rank-and-file members and union employees, SEIU’s officer pension plan, the SEIU Affiliates Officers and Employees Pension Plan, was funded at 102 percent in 2007.
Just remember this when it comes time for the taxpayers to bail out the public employee pension funds.