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]]> Wed, 15 Oct 2008 01:00:00 CDT U.S. Rep. George Miller (D-CA), the chairman of the House Education and Labor Committee, issued the following statement today in honor of National School Lunch Week. The National School Lunch Program provides nutritionally balanced, low-cost or free lunches to millions of children in schools each day, as well as after school and summer programs. The Child Nutrition and National School Lunch Acts are up for reauthorization in 2009.

“Millions of children rely on the National School Lunch Program for nutritious meals that help them thrive inside and outside the classroom. Unfortunately, the current economic crisis has placed tremendous pressure on both families and schools. Parents are finding it harder to put meals on their tables and are relying more heavily on school meal programs to help feed their kids. At the same time, schools are being forced to cut costs while still striving to offer healthy meals that kids will choose to eat.

“We know that this isn’t fair for schools or good for our children. School meal programs are on the frontlines of our nation’s childhood obesity battle – and have an enormous influence as children are developing life-long eating habits. Especially in light of the growing fiscal challenges we face, we must do everything we can to help schools find creative ways to continue providing low-cost, healthy meals for children. Providing children with access to nutritious foods while at childcare, school, or summer camp is vital to our efforts to help all children learn, succeed and thrive – and for improving the health of all Americans.”

The Committee on Education and Labor held two hearings on child nutrition gearing up for next year’s reauthorization – for more information about these hearings, click here and here.

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FOR PRESS INQUIRIES
Contact: Aaron Albright / Rachel Racusen
2181 Rayburn House Office Building
Washington, DC 20515
202-226-0853

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“The credit crisis and stock market crash is making an already dire unemployment situation worse,” Miller said today.  “The top economists who have briefed the Democratic leadership today and over the last few weeks all agree that unemployment is going to continue to rise.  We are going to examine the best ways to get Americans back to work and put our economy on the road to recovery.

“The emergency financial bill Congress approved late last month was one important step toward rescuing the economy, but we knew then that additional, comprehensive measures would be needed to help stabilize and heal our broken economy.  We need a longer-term economic recovery plan that will create jobs, grow the economy, and protect Main Street. These hearings will be vital to our efforts to develop a plan that rebuilds our economy while protecting taxpayers and helping workers and their families seize the opportunities that our 21st century economy presents.”

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FOR PRESS INQUIRIES
Contact: Aaron Albright / Rachel Racusen
2181 Rayburn House Office Building
Washington, DC 20515
202-226-0853

Miller and Andrews also announced that they will push to enact legislation based on H.R. 7242 that would suspend the tax penalty for seniors who have saved less than $200,000 in their retirement accounts. That bill was introduced on October 2, 2008 by Rep. Andrews.

“American workers have already seen at least $2 trillion disappear from their retirement accounts,” said Rep. Miller. “Now is the time to act. Seniors have seen their retirement accounts decimated and need immediate relief.”

Current regulations require account holders of 401(k)-type account to withdraw a minimum amount of money every year after they reach 70 ½ years old. If seniors do not take out a minimum amount based on an Internal Revenue Service formula, they are subject to a 50 percent penalty. For instance, if an individual fails to withdraw $4,000, they would be assessed a $2,000 tax the next year.

However, as a result of the financial crisis, many seniors have seen their savings evaporate. At an Education and Labor Committee hearing this week on the impact of the financial crisis on retirement security, the Congressional Budget Office found that $2 trillion has disappeared from Americans’ retirement plans over the past 15 months.

For more information on the hearing on the financial crisis’ impact on retirement savings, click here.

The full text of the letter is below.

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October 10, 2008

The Honorable Henry M. Paulson, Jr.

Secretary

U.S. Department of the Treasury

1500 Pennsylvania Avenue, NW

Washington, DC  20220

Dear Secretary Paulson:

As a further step to address the current financial crisis, we request that you take immediate action to help senior citizens preserve their retirement investments.  Specifically, we request that you suspend the required minimum distribution (RMD) and the tax penalty for retirement account holders who are 70 years or older who might not want to withdraw from their retirement accounts during the current financial crisis. 

As you know, seniors who fail to take the RMD have to pay a tax penalty equal to 50% of the amount that should have been distributed.  Unless this provision is temporarily suspended, seniors will be doubly penalized by the current crisis – first by experiencing a dramatic drop in the value of their retirement account holdings and second by forcing them to sell a portion of those holdings at a steep loss. 

American workers have lost $2 trillion in retirement savings over the past 15 months, according to the Congressional Budget Office.  This estimate that underscores the fact that retirement security is one of the greatest casualties of the present crisis. 

We believe that you have the legal authority to effectively eliminate this penalty by not requiring the RMD for 2008.  Current law requires minimum distributions over the life of the retiree.  However, the Treasury regulations interpret this as requiring annual distributions.  By taking action, seniors will avoid taking unnecessary losses in their retirement accounts and avoid the current excise tax.  We request that you take this action immediately to help protect and rebuild the retirement savings of older Americans.

Sincerely,

GEORGE MILLER                                                  

Chairman                                                                    

ROBERT E. ANDREWS

Subcommittee Chairman

Health, Employment, Labor, and Pensions

FOR PRESS INQUIRIES
Contact: Aaron Albright / Rachel Racusen
2181 Rayburn House Office Building
Washington, DC 20515
202-226-0853

]]> Tue, 07 Oct 2008 18:08:00 CDT ]]> Tue, 07 Oct 2008 16:13:00 CDT This statement was made today by Chairman George Miller at the House Education and Labor Committee's hearing on the "Impact of the Financial Crisis on Workers' Retirement Security."

Good afternoon.

Last week, Congress approved an emergency rescue plan in response to the worst financial crisis our country has seen since the Great Depression. We know that this plan alone will not magically turn the economy around. But we are confident that without it we will not have the chance to move forward.

We insisted that the plan include strong protections for taxpayers and tough accountability – neither of which was included in the President’s original request to Congress.

Immediately after the plan was approved, Speaker Pelosi announced that the House would conduct a series of hearings to investigate the causes of the current financial crisis and what steps we should take next to protect homeowners, workers and families struggling today.

As part of that commitment, the Committee on Education and Labor today is holding a hearing to explore how this financial crisis is impacting the retirement security of American families.

Yesterday, the House Oversight and Government Reform Committee launched the first of many oversight hearings examining the toxic mix of corporate greed, recklessness, and deregulation that created this financial crisis.

During his testimony, Lehman’s CEO, Mr. Fuld, showed no remorse for his catastrophic mismanagement of the company. In fact, he repeatedly denied responsibility for running the storied Lehman Brothers investment house into financial oblivion.

He refused to admit that his own reckless management – and his industry’s success of keeping regulators at bay – directly contributed to this historic financial crisis that is costing taxpayers, shareholders, and the nation’s current and future retirees billions of dollars from their nest eggs.

All the while, he insisted on taking obscene multi-million dollar bonuses for his executive teammates.

Unlike Wall Street executives, American families don’t have a golden parachute to fall back on.
It’s clear that their retirement security may be one of the greatest casualties of this financial crisis.

The current financial and housing crises are stripping wealth from American families at a record rate.

A new poll just found that 63 percent of Americans are worried that they will not have enough savings for their retirement. Tragically, they may very well be right. Due to the collapse of the housing market and the financial crisis, trillions of dollars that Americans were counting on has been lost.

Americans were counting on much of this wealth for their retirement. Now it is gone – as is their ability to adequately fund their retirement.

Even before the current meltdown, middle-income families were losing ground due to the decline in middle-class wages over the last decade – making it harder for them to save for their retirement and family emergencies.

Retirement and financial experts now predict that retirees and older workers who rely on financial investments for retirement income may suffer more than any portion of the American population in the coming years.

According a survey released today by the AARP, one in five middle-aged workers stopped contributing to their retirement plans in the last year because they had trouble making ends meet. One in three workers has considered delaying retirement.

Now, the number of investors taking loans on their 401(k) accounts is increasing. And hardship withdrawals are also increasing.

T. Rowe Price estimates a 14 percent increase in hardship withdrawals just in the first eight months of 2008.

And, all the signs point to an increased frequency of 401(k) loans and hardship withdrawals in the coming year.

It makes sense that more Americans will be raiding their retirement accounts as they deal with rising unemployment and increasing costs of basic necessities.

Unfortunately, these drastic measures taken by workers today will have a long-lasting impact by significantly reducing account balances once these workers reach retirement age.

Over the past 12 months, more than a half trillion dollars have evaporated from 401(k) plans as a direct result of the crisis in the markets.

Some experts say that it will take as long as 3 years to recover market losses in 401(k)-style accounts – but only if the market turns around soon.

Just like consumer directed retirement plans, traditional pension plans are not immune from the financial crisis.

Although pension plans hire professional money managers and are required to be diversified, these plans will likely lose value as a result of the weak performance of the investment markets.

Sophisticated pension funds lost 20 to 30 percent of their value during the 2001 recession and took several years to overcome those losses.

We must keep our eye on these plans and I await further data on the health of our nation’s pensions.

While this crisis began on Wall Street, much of the financial burden will ultimately be borne by Main Street. And this did not happen overnight.

With the Republicans’ help and armed with their powerful lobbyists, Wall Street cunningly held off fair regulations by Congress, arguing that Americans would be better off if left to their own devices.

As Congress continues our investigations into this crisis, we cannot allow those responsible to emerge unscathed. The American people are paying the price of this go-go, Wild West approach to governing.

One cost will be the concern that our nation’s workers will not have sufficient savings to ensure a secure retirement after a lifetime of hard work. In the coming months, this committee will examine what measures may be needed to ensure a safe and secure retirement for workers, retirees and their families.

For starters, we know that 401(k) holders lack critical information about how their money is managed and what fees they pay.

I’m here to say right now, those days are over.

We must have more transparency in 401(k) investment practices. The Wall Street veil of secrecy must end.

I would like to thank all of our witnesses for joining us today. I look forward to their testimony.  

And I expect that we will be back here repeatedly until we can ensure greater security for the retirement of hard-working Americans.

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"The Impact of the Financial Crisis on Workers' Retirement Security"
Scheduled at 1:00 p.m. on Tuesday, October 7, 2008, in room 2175 Rayburn H.O.B.

Witnesses:

Jerry Bramlett
CEO
BenefitStreet, Inc.

Dr. Teresa Ghilarducci
Professor of Economic Policy Analysis
The New School for Social Research

Dr. Peter Orszag
Director
Congressional Budget Office

Jack VanDerhei
Research Director
Employee Benefit Research Institute

Dr. Christian Weller
Associate Professor of Public Policy, University of Massachusetts-Boston
Senior Fellow, Center for American Progress

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“Unlike Wall Street executives, American families don’t have a golden parachute to fall back on,” said U.S. Rep. George Miller (D-CA), chairman of the committee. “It’s clear that Americans’ retirement security may be one of the greatest casualties of this financial crisis.”

According to the Congressional Budget Office, this multi-trillion dollar loss in workers’ retirement wealth could further slow the ailing economy.  

“To the extent households view balances in defined-contribution plans as part of their overall portfolio of wealth, a decline in those balances could lead people to reduce or delay purchases of goods and services,” said Peter Orszag, director of the CBO. “It could also lead some workers to delay their retirement.”

According to a survey released today by the AARP, in the last year 20 percent of baby boomers stopped contributing to their retirement plans because they have had trouble making ends meet. As several witnesses explained, workers closest to retirement may suffer the biggest hit from the financial meltdown. 

“The current financial crisis has certainly highlighted the fact that 401(k) participants—whose 401(k) account represent their sole retirement savings—bear all the investment risk,” said Jerry Bramlett, president and CEO of BenefitStreet, Inc., an independent retirement plan administration firm. “The pain is particularly acute for those participants closer to retirement whose retirement income expectations have been significantly impaired possibly resulting in the need to postpone retirement.”

The AARP also found that a third of workers surveyed are considering delaying retirement as a result of the financial and housing crises.

“In the last few weeks, we’ve been confronted with older worker and retirees’ lives being turned upside down; their panic tops-off an already existing state of chronic anxiety about retirement futures,” said Teresa Ghilarducci, professor of economic policy analysis at The New School for Social Research.

Witnesses also said that while the current financial crisis is reducing worker’s savings today, retirement insecurity had been steadily growing over the past decade.

 “While the events that have taken place over the past several weeks have shone a spotlight on how affected Americans’ retirement plans can be by such volatility in the financial markets, it is important to keep in mind that Americans’ retirement security has been in distress for much longer than the past few weeks,” said Christian Weller, senior fellow at the Center for American Progress  “In fact, retirement security has been a growing concern for Americans for many years due to limited retirement plan coverage, little retirement wealth, and increasing risk exposure of the individual.”

Rep. Miller said that greater transparency in retirement plans and the fees workers pay is needed, especially when workers are losing money and looking for the best deal.

“401(k) holders lack critical information about how their money is managed and what fees they pay. I’m here to say right now, those days are over,” said Miller. “We must have more transparency in 401(k) investment practices. The Wall Street veil of secrecy must end.”

The House Education and Labor Committee passed a bill introduced by Rep. Miller that would require workers to receive clear and complete information about fees that – in some cases – are cutting deeply into their 401(k)-style retirement savings.

For more information on H.R. 3185 and the effects of hidden fees on workers’ retirement savings, click here.

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FOR PRESS INQUIRIES
Contact: Aaron Albright / Rachel Racusen
2181 Rayburn House Office Building
Washington, DC 20515
202-226-0853

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“With unemployment benefits for hundreds of thousands of Americans set to expire, this extension will provide much-needed help for workers who are struggling to put food on the table and pay their home and heating bills while looking for a job. In my home state of California alone, more than 200,000 workers stand to lose their benefits over the next three months unless this extension is enacted.

“In light of this morning’s devastating economic news that we lost 159,000 jobs in September, the House did the right and fair thing for millions of out-of-work Americans. 

“We can’t allow the rug to get pulled out from under jobless workers. Extending unemployment benefits is a no-brainer – it’s one of the most effective things we can do to help workers and stimulate our economy. With our nation’s financial wounds deepening by the day, the Senate and the President should join us in supporting it.”

The Unemployment Compensation Extension provides workers with an additional seven weeks of unemployment benefits for workers who have exhausted their regular unemployment and an additional 13 weeks of benefits for workers in states with the highest unemployment.

These benefits were first passed by the House last week as part of a comprehensive economic stimulus package that also invested in job creation and training programs to help unemployed workers find jobs.

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FOR PRESS INQUIRIES
Contact: Aaron Albright / Rachel Racusen
2181 Rayburn House Office Building
Washington, DC 20515
202-226-0853

"While approximately forty-four million Americans suffer from mental illness, only one-third actually receive treatment," said U.S. Rep. George Miller (D-CA), chairman of the House Education and Labor Committee. “As a result of this measure, millions of Americans will now have access to comprehensive and affordable mental health and substance abuse benefits.”

The measure prohibits employer group health plans from imposing limitations on coverage for mental illnesses that they do not impose on physical illnesses. For example, group health plans would have to offer the same terms for deductibles, limits on hospital stays and outpatient visits, and co-payments.  

The bill is named after the late Sen. Paul Wellstone (D-MN) and current Sen. Pete Domenici (R-NM), both longtime advocate of mental health awareness and parity.

For more information on The Paul Wellstone-Pete Domenici Mental Health and Addiction Equity Act, click here.

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FOR PRESS INQUIRIES
Contact: Aaron Albright / Rachel Racusen
2181 Rayburn House Office Building
Washington, DC 20515
202-226-0853

“Today’s jobs report highlights the massive destruction that the Bush-Cheney-McCain wrecking ball has done to our economy, workers, and families. Eight years of their misguided policies have culminated in nine straight months of job losses. Two million workers have been unemployed for more than 27 months – 167,000 more than in August. Our nation is now dealing with the largest financial crisis since the Great Depression.

“America’s working families are hurting, and in need of real solutions to get our economy back on track. For starters, we must extend unemployment benefits for hundreds of thousands of out-of-work Americans whose current benefits are set to expire this weekend. Today, as the House considers a financial rescue plan to protect the credit that small businesses and families rely on, we will also vote to extend unemployment benefits to help workers cover their bills while looking for a new job.

“But workers also need a long-term strategy to generate new jobs. Last week, the House passed a much-needed stimulus that would create millions of good-paying jobs by investing in our crumbling infrastructure – an investment that would get our nation back to work and prevent our economy from falling deeper into recession. Unfortunately for American families, Senate Republicans blocked the package.

“This latest news underscores the urgent need to ease the pain of America’s working families and get our economy on the road to recovery.”

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FOR PRESS INQUIRIES
Contact: Aaron Albright / Rachel Racusen
2181 Rayburn House Office Building
Washington, DC 20515
202-226-0853

FOR MORE INFORMATION, CONTACT:

Rep. Markey:  (202) 225-4081
Rep. Waxman:  (202) 225-5051
Rep. Inslee:  (202) 226-7040

WASHINGTON, DC — Today 152 Members of Congress, led by Rep. Waxman, Rep. Markey, and Rep. Inslee, sent a letter to Speaker Pelosi detailing a set of principles to guide Congress as it produces legislation to establish an economy-wide mandatory program to address the threat of global warming.  

The principles outlined in the letter lay out a comprehensive approach to tackling the climate crisis.  The principles recognize that we must transition to a clean energy economy to avoid dangerous global warming, create green jobs, and boost America’s long-term economic prosperity.  The principles emphasize that we must act based on the science and strengthen our response as necessary.

To read the letter CLICK HERE.

For a PDF of the letter CLICK HERE. 

152 Members of Congress, led by Representatives Ed Markey (D-Mass.), Henry Waxman (D-Calif.), and Jay Inslee (D-Wash.) have joined together to solve both our climate and economic crisis. In a letter outlining principles for global warming legislation, the members stress the need to invest in a clean energy economy that will create millions of new green jobs here at home while simultaneously cutting the heat-trapping emissions responsible for global warming.

To Download a PDF of the letter, CLICK HERE.
To read the press release from Rep. Waxman, Markey and Inslee, CLICK HERE.