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Trouble for federal agency that backs 44 million pensions

The Christian Science Monitor
Imagine an insurance company that is facing today a deficit of billions of dollars. But its board of directors has not had a meeting since February 2008.

Meet the Pension Benefit Guaranty Corp., a federal agency that takes over underfunded pension funds from bankrupt companies and pays their retirees.

Going into this year, the PBGC was running a deficit of $10.7 billion as the premiums set by Congress and paid by on-going companies were less than the payments to retirees. Then, on Wednesday it said for the first half of 2009, the deficit had ballooned out to $33.5 billion, the largest in PGBC history. Now Congress, who has oversight over the entity, is worried about what might happen if some really large corporation۝think auto industry۝dumped pension liabilities on the PBGC. Some outside experts can envision a future deficit as high as $100 billion.

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