This is actually a lot more interesting than it sounds. Many companies have long under-funded their pension benefits through a bunch of different ways, the most common of which is to project far too optimisitic returns on the pension’s investments. For instance, the stock market’s historical return has been 7%. Many plans assume they’ll get a return of 10% or more every year forever in order to pay their obligations. This, of course, fails, and then (shockingly) the fund’s can’t pay people.

And that’s just one thing that’s gone wrong.

The argument against was that in tightening requirements, it would discourage companies from having the plans, or encourage them to default now. This seems strange to me: it’s like arguing that stopping the fraudulent sale of unicorns would prevent people from buying unicorns. If the pension plan can’t pay because it’s not funded, it’s not any less solvent now.

This doesn’t prevent financial hijinks, of course, but it’s certainly a good step towards it. Clap clap clap.

Not that anyone I know gets any kind of pension benefits these days. We’re all on 401(k) plans now.