Should politicians have the authority to hand private trucking organizations millions, if not billions, of taxpayer dollars? A recent U.S. Supreme Court decision struck down the Biden Administration’s attempt to shuffle tax dollars to pay off student loans. The comparison may be apples to apples, or apples to oranges, depending on whether you have skin in the game. But the question has not been thoroughly answered.
The Trump Administration bailed out Yellow Corp with a $700 million pandemic loan. Now teetering on bankruptcy, Yellow recently got a reprieve on paying back the taxpayer loan, as well as other financial obligations. Critics say Yellow — employing upwards of 30,000 people and 22,000 truckers — should not have qualified.
“The $700 million taxpayer-backed loan Treasury made to Yellow, formerly YRC, was a mistake. Based on the oversight work conducted by the Commission, there is no evidence to support Yellow being critical to national security, which means these loans should never have been executed,” U.S. Rep. French Hill reportedly said.
But because the fourth largest trucking outfit in the country delivered goods to military facilities, it was prioritized in exchange for yielding a 30 percent stake to the federal government. On Sunday, July 23, Yellow agreed to pay $50 to a healthcare and pension fund for the International Brotherhood of Teamsters to avoid a potentially crippling strike. Trucking industry insiders and financial experts see Yellow in an economic death spiral. Even if it works out a deal with Teamsters, the cash-strapped operation loses money.
The Biden Administration also handed out taxpayer funds to a trucking-based organization. Using the American Rescue Plan law, the White House sent $36 billion to buoy the same Central States Pension Fund that Yellow didn’t pay $50 to on time. Critics say the fund has been grossly mismanaged for decades. George Mason University retirement security expert, Charles Blahous, noted that before the recent laws, both parties agreed that “private pensions were obligations” outside taxpayer responsibility.
“The largest private pension bailout in American history — that only benefits a tiny minority of workers — comes thanks to Democrats allowing those who mismanaged pensions to determine whether their funds qualify for taxpayer assistance with no safeguards,” U.S. Rep. Kevin Brady reportedly said.
By that same token, the floundering Central States Pension would likely have been forced to make Draconian cuts to upwards of 360,000 retired Teamsters benefits. These bailouts may have prolonged jobs and benefits. But who should bear financial responsibility?
Sources:
https://www.nwaonline.com/news/2021/may/01/trucking-firms-loan-of-700m-from-us-a-mistake/
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