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thatcrazycajunAs if I hadn't already had a truly hellish day full of mistakes and hassles, now comes American Public Radio's Marketplace with a report on the latest American major corporations to welch on pension promises to their retirees. General Motors Corp. has announced it will terminate its pension plan, and right here in Atlanta, Delta Air Lines is going back to bankruptcy court to get the judge's permission to dump its pension as well. More and more, corporations are seeing pensions as a burden rather than a valuable investment in their workers; see CNN's Money website for more on this topic. Makes me think a litle harder about taking out that Roth IRA i've been meaning to get from Wachovia...
Now, I realize that GM, Delta and the other companies in the news for this lately (most of them 40 years old or more) have a problem younger, smaller companies don't have: lots and lots of old former employees and not enough money to pay them pensions. And they can't stay competitive with those younger, smaller companies if they don't cut costs everywhere they can. And the impending deluge of baby-boomer retirements doesn't help any. But it still seems a tad heartless to throw their retirees overboard for the sake of slashing overhead.
Maybe someone in Congress should draft a bill mandating criminal penalties for firms that try to dump their pension plans unless they can show (by very strict criteria) a genuine survival-dire need to do so. Anyone think this is a worthwhile notion?
Now, I realize that GM, Delta and the other companies in the news for this lately (most of them 40 years old or more) have a problem younger, smaller companies don't have: lots and lots of old former employees and not enough money to pay them pensions. And they can't stay competitive with those younger, smaller companies if they don't cut costs everywhere they can. And the impending deluge of baby-boomer retirements doesn't help any. But it still seems a tad heartless to throw their retirees overboard for the sake of slashing overhead.
Maybe someone in Congress should draft a bill mandating criminal penalties for firms that try to dump their pension plans unless they can show (by very strict criteria) a genuine survival-dire need to do so. Anyone think this is a worthwhile notion?
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Date: 2006-06-21 10:19 pm (UTC)