Romney enlists Ryan to wage war on railroad workers

Posted by admin on August 15, 2012

CLEVELAND, August 14 – Less than three weeks away from formally accepting
his party’s nomination for the Presidency of the United States, former
Massachusetts Governor Mitt Romney has chosen Wisconsin Representative and
House Budget Committee Chairman Paul Ryan, the architect of a plan to gut
the pension rights of railroad workers, as his running mate.

“This pairing represents a nightmare scenario for BLET members and all
railroad workers in America,” BLET National President Dennis R. Pierce
said. “With Romney’s campaign trail promises to slash Amtrak funding and
Ryan’s infamous budget plan that would destroy Railroad Retirement Tier 1
benefits, there could be many dark days ahead from railroaders if this
pair is elected in November.”

Ryan is the author and primary sponsor of the so-called Ryan Budget plan,
which was passed by the House of Representatives earlier this year. The
peril to the pension rights of railroad workers is laid out on page 101 of
House Report No. 112-421 that accompanied the measure, under the heading
of “Conform Railroad Retirement Tier 1 Benefits to Social Security
Benefits,” which states as follows:

“Tier 1 benefits for railroad retirees are supposed to mimic Social
Security benefits, but they are more generous than Social Security in many
ways. This option would conform Tier 1 so that its benefits would equal
those of Social Security, with an estimated savings to taxpayers of $2
billion over 10 years.”

That proposal would have the following disastrous effects for railroad
workers, their spouses and dependents:

 it would eliminate the “60/30” provision that allows railroad employees
to retire with full benefits at 60 years of age with 30 years of service;

 it would eliminate the Railroad Retirement Occupational disability
program for rail workers who can no longer perform their railroad duties
due to disability;

 it would increase the minimum retirement age for railroad employees to
62 years of age with a reduction in benefits;

 it would increase the minimum age for spousal annuities with a reduction
in benefits; and

 it would increase the annual out-of-pocket medical costs paid by
railroad retirees and cause the costs of railroad retiree health insurance
under GA-46000 to soar.

The claim that repealing pension rights for railroad workers would save
the U.S. taxpayers even a single dime, much less “$2 billion over 10
 years” is completely false. All Railroad Retirement benefits – whether
Tier 1 Social Security equivalent benefits or the Tier 2 benefits that
represent the railroad industry’s pension plan – are fully funded through
taxes paid by railroad workers and their employers.

But soon-to-be GOP Vice Presidential candidate Ryan won’t let the facts
get in the way of a good story. In a May 14 letter to a California
constituent, Ryan not only admitted that his budget plan would strip
railroad workers of their unique Railroad Retirement benefits, he also
made the assertion that “Tier 1 Retirement Benefits are… invested in
special non-marketable bonds, just like with Social Security.” This claim,
too, is demonstrably false.

Section 107(c) of the Railroad Retirement and Survivors’ Improvement Act
of 2001 specifically provides for all Tier 1 funds in the Social Security
Equivalent Benefit Account to be transferred to the Railroad Retirement
Investment Trust (RRIT), except for those “needed to pay current benefits
and administrative expenses.” And Section 105 of the Act empowers the RRIT
Trustees to determine how the funds will be invested; the majority of
those investments are in other than non-marketable bonds, which yield a
significantly higher rate of return than investments made by the Social
Security system.

The Ryan Budget also targets the retiree medical benefits of railroad
workers and all Americans. It proposes to eliminate Medicare as we know it
and increase the Medicare eligibility age to 67 with drastically reduced
coverage. Ryan also wants to replace Medicare’s guaranteed benefits with a
voucher system that is not guaranteed to cover the cost of equivalent care
currently provided under Medicare; this change would affect anyone born in
1958 or later.

On March 20, while stumping in Chicago, Romney said “I’m very supportive
of the Ryan budget plan. It’s a bold and exciting effort on his part and
on the part of the Republicans and it’s very much consistent with what I
put out earlier. …I applaud it. It’s an excellent piece of work and very
much needed.” More recently, he vowed that, if he were President he would
have signed the Ryan Budget if it had crossed his desk.

“Saturday’s announcement by the presumptive GOP nominee underscores for
BLET members and all railroad workers and their families what is at stake
in this fall’s national elections,” President Pierce said. “We must
remember in November which candidates support our interests, and which
ones will do us harm.”


The following related resources concerning this issue can be
viewed/downloaded/printed from the BLET website:

 Romney vows in Iowa to cut Amtrak funding as President (November 8,

 Romney Campaign Doubles Down: He ‘Would Have Signed” The Ryan Budget
(August 12, 2012):

 Five Times Mitt Romney Has Embraced The Ryan Budget (August 11, 2012):

 Link to H. Con. Res. 121 (70 pages): 112 eh.pdf

 Link to Resolution, House Report (H.Rep.) No. 112-421 (230 pages;
offending language on Page 101): 112-421.pdf

 Link to House voting record on H. Con. Res. 112:

 Link to Association of American Railroads letter to Rep. Paul Ryan
regarding House Report 112-421:

 Paul Ryan’s May 14, 2012, letter to California constituent:

Last modified on August 15, 2012

Categories: BLET Washington, DC
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