When Hostess Brands Inc. went bankrupt in 2012, it triggered anxiety among employees at Ottenberg’s Bakery, a family-owned enterprise in Maryland, since the companies shared a pension plan, and if Hostess couldn’t pay its retirees, Ottenberg’s would have to pick up the tab, Bloomberg News reported yesterday. Last week, Ottenberg’s employees received the good news that the U.S. government saved their benefits by sacrificing those of Hostess’s drivers, who will now get a reduced payout financed by the government. Ottenberg’s employees are among the 10.4 million Americans with retirements tied to multiemployer pension plans, large investment pools long considered low risk because they don’t rely on a single company for financing. Two recessions, industry consolidation prompted by deregulation, and an aging workforce have funds facing a $400 billion shortfall that has some near insolvency. Dozens already have failed, affecting 94,000 participants.
