United, Pension Agency Reach Settlement (pension default)

[struggle4progress]

By DAVE CARPENTER
AP Business Writer
April 22, 2005

The government's pension-protection agency agreed Friday to stop fighting United Airlines' plan to eliminate its defined-benefit pension plans, removing the biggest remaining obstacle to what would be the largest pension default in U.S. history.

United said the decision, the result of a settlement with the Pension Benefit Guaranty Corp., resolves a major issue standing between the airline and its successful exit from bankruptcy.

"It will allow the company to move forward as a sustainable, competitive enterprise for the long term _ ultimately United's most important goal," spokeswoman Jean Medina said.


But in a sign the battle over pensions is not over, union leaders assailed the move as a "sellout" by the pension agency and pledged to fight it in bankruptcy court and elsewhere if necessary. The International Association of Machinists and Aerospace Workers, representing about 19,500 United ground workers, reiterated a threat to strike if pensions are scrapped over its objections. <snip>

http://www.spokesmanreview.com/ap/story.asp?AP_ID=D89KNI600

[cliss]

1. The hot potato that no one wants......

Many, many publicly traded companies are watching these developments with interest. What they are seeing, amazingly, is a Republican* administration, that is doing some awfully socialistic things.

*hint: they're not republicans.

Conservatives typically don't like government assistance of any kind. They like the "Laissez-faire" style where, if a company is faltering, it's better to let the company die than to bail it out. Over the long haul, it's better for the economy. Laissez faire means = let do. Let them do whatever, and if they collapse, it's not our problem.

What we're seeing now is bail-outs, of the highest order. We're talking about billions.

I read in a recent trade publication that companies are going to start doing this more and more. They're going to default on their pension obligations. He thought it was a good thing.

I'll give you 1 guess as to who gets stuck with this bill.

[struggle4progress]

2. Corporate America has always been in favor of corporate welfare.

[struggle4progress]

3. Who gets stuck? Mostly, the workers, of course.