Congress has pulled its hand halfway out of the pension fund cookie jar. But that's not far enough.
The new tax bill that has just been approved by Congress should ease some of the various limits that were imposed on defined benefit and defined contribution plans in the name of fiscal austerity since the mid-1980s.
But not completely.
The bills do not restore the limits that existed before the pension raids began in the days of looming deficits, even though we now have looming surpluses.
For example, the bills would phase out the funding limit that caps employer contributions to pension plans at 150% of the accrued benefit obligation.
Great.
But Congress didn't phase the limit in. It was imposed from day one. What that means is Congress takes quickly, but gives back slowly -- very slowly and reluctantly.
To be sure, Congress is offering a half dozen other modest proposals that improve the situation, especially for small employers and individuals.
For example, the Pension Benefit Guaranty Corp. flat rate for fully funded plans premium would be reduced to $5 per participant.
And employees would be allowed to contribute more to 401(k)s and individual retirement accounts. But none of these is restored to the mid-1980s level.
And there is precious little in the two proposals to encourage a small employer to start a defined benefit plan, or a large employer to maintain a defined benefit plan.
And little even to encourage more defined contribution plans.
Congress could have done more.
