Maybe We Were a Tad Premature

…in our choice of the next bailout candidate. And this one surely needs watching in the longer-term. It’s the Pension Benefit Guaranty Corp (PBGC). From Calculated Risk:
Pension Benefit Guaranty Corporation Deficit Increases
by CalculatedRisk on 11/14/2009 11:58:00 AM

The Pension Benefit Guaranty Corporation (PBGC) is the federal agency that guarantees pensions for 44 million Americans. The PBGC deficit doubled over the last six months to $22 billion … but this is only just the beginning as the agency’s potential exposure to future losses increased sharply.

From the Pension Benefit Guaranty Corporation (PBGC): PBGC Releases Annual Management Report for Fiscal Year 2009

The Pension Benefit Guaranty Corporation (PBGC) ended fiscal year 2009 with an overall deficit of $22 billion, according to the agency’s Annual Management Report submitted to Congress today. The result compares with the $11.2 billion deficit recorded at the previous fiscal year-end on September 30, 2008.

…

The Annual Management Report classified 27 large pension plans with total underfunding of $1.64 billion as probable losses on the PBGC balance sheet. The report also shows that the agency’s potential exposure to future pension losses from financially weak companies increased to about $168 billion from the $47 billion booked in fiscal year 2008.

“Exposure to possible future terminations means that we could face much higher deficits in the future,” said Acting Director Vincent K. Snowbarger. “We won’t fail to meet our obligations to retirees, but ultimately we will need a long-term solution to stabilize the pension insurance program.”

(emphasis added)

With companies moving away from defined benefit plans, there will be fewer companies paying for insurance in the future–and the “long-term solution” will probably involve some sort of bailout.