Thursday, November 18, 2004

PBGC Bleeding Red Ink

The PBGC confirmed earlier this week that its deficit, already at the highest in its history, had doubled in its last fiscal year from $11.2 billion to $23.3 billion. Much of the loss for fiscal year 2004 was a result of pension fund failures in the airline industry. The agency has now lost an average of $10 billion a year for the last three years.

Furthermore, the agency now faces $96 billion worth of risk from companies that are "reasonably possible" to default on their pension promises compared to $82 billion just one year ago.

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