If companies find conversion too onerous, he notes, they'll simply terminate their defined-benefit plans altogether.
More and more (including The Economist) have shut their defined-benefit plans to new entrants.
Such programs, known as defined-benefit plans, pay retired workers a monthly stipend as long as they live.
Less than a fourth of private-sector workers are still covered by defined-benefit plans today, down from 39% in 1975.
As with 401(k)s, lower-cost, off-the-shelf defined-benefit plans have started to hit the market.
In 1942 laws were passed restricting the amount in classic pensions that provided a set payment, known as defined-benefit plans, to 10%.
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In 1991 West Virginia lawmakers ended their defined-benefit plans for new teachers.
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The problem is that defined-benefit plans act like a blank check.
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With the shift from defined-benefit plans to defined-contribution plans, and the uncertain future of social security, boomers are on their own when it comes to financing retirement.
"The man is trying to kill defined-benefit plans, " fumes Lofgren.
Workers and pensioners in the steel and airline industries, who account for fewer than 5% of participants in defined-benefit plans, have benefited from 70% of the agency's claims since 1974.
The portion of private-sector U.S. workers covered only by so-called defined-benefit plans fell to 3% in 2011 from 28% in 1979, according to U.S. Department of Labor data compiled by EBRI.
Until recently, defined-benefit plans were popular with employers too.
The defined-benefits revolution that has swept through the private sector has hardly touched the public one: 90% of American state- and local-government workers have defined-benefit plans, compared with 20% of private-sector workers.
That's too bad because sooner or later the defined-benefit plans are going to run out of money and benefits will be cut especially if pension trustees let Randi Weingarten serve as chief investment officer.
The investment concepts being promoted stocks outperform bonds in the long term, risk can be diversified away are the very concepts that landed defined-benefit plans in trouble in the first place and this is unconscionable.
In fact, the law's stiffer funding requirements for defined-benefit plans will likely push companies with underfunded plans to freeze them, says Jack VanDerhei, a Temple University professor and fellow at the Employee Benefit Research Institute.
Defined-benefit plans are proving to be unaffordable.
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But ever since disgruntled IBM employees brought the issue to public attention, the movement by major corporations to convert traditional defined-benefit plans to so-called cash-balance pension plans has been a lightning rod for workers'--and particularly baby boomers'--growing anxiety over their retirement incomes.
This points to two other defects inherent in defined-benefit plans: All the risk is borne by the taxpayers, and the inability to foresee how much more money will be needed to fully fund the plans makes long-term budget-planning extremely problematical for school boards.
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It seems clear, though, that Americans have won more responsibility for their retirement portfolios as firms switch from defined-benefit pension plans to defined-contribution plans.
How long can we keep government employees on defined-benefit pension plans while the rest of us scramble to fund our 401(k)s?
With defined-benefit pension plans falling by the wayside, a growing number of buyers are turning to longevity policies to serve as pension substitutes.
But the regulation also offers us an opportunity to discuss a broader issue: why do charter schools even want to participate in defined-benefit pension plans?
"These plans are concerned about their ability to invest with your firm going forward, " Ms. Weingarten wrote, given Mr. Loeb's support for StudentsFirst and its "outspoken attacks" on defined-benefit pension plans.
If prior contributions to defined-benefit pension plans earn a lower investment return than the state and federal regulators governing these plans had assumed they would, taxpayers must make up the difference.
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With markets volatile and corporations scaling back defined-benefit pension plans, those in or near retirement are paying high fees to transform plain old variable annuities into a source of guaranteed income for life.
Another beneficial effect is that American employers with defined-benefit pension plans for employees have been able to reduce their contributions into pension funds as the rise in share prices has swollen the value of funds' assets.
That was the same argument the financial industry used to kill off the defined-benefit pension plans our grandparents relied on in order to sell a new generation of savers on the idea that 401-Ks had the potential for higher returns.
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Earlier this month, President George W. Bush signed a rewrite of the nation's pension laws that will likely hasten the disappearance of traditional defined-benefit pension plans--the kind that are funded entirely by the company and promise retirees a fixed stipend each month for life.
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