Nothing can destroy a family more than to learn that their jobs and pensions are gone. Enron was the most egregious example recently. The Enron leadership lied about the soundness of the employee’s investment. But more Americans are learning that they can lose their pensions in other ways.
The Washington Post has had a couple of stories recently that should be read by anyone who thinks their company’s promise to pay their pensions is worth the paper it’s written on. Fifty-two year old Steve Derebey thought he would soon retire on a $66,000 a year pension.
But last month, in a Chicago bankruptcy court, United Airlines almost certainly changed the rest of the Derebeys’ life, warning that it will likely dump its pension plan onto the federal government. Under the rules of the federal Pension Benefit Guaranty Corp. (PBGC), Derebey would be left with $22,000 a year, a third of his expected benefit. Now, he and his wife are hastily planning a second career, a long one, they say, maybe running their own public relations shop in Seattle.
There are other examples in this story that are heartbreaking. Read the story closely, because not only was Derebey’s pension severely cut, but you may wind up paying for it.
Then today, The Post tells of the Pennsylvania workers who just lost their job because the plant in their town closed its doors but came away with a viable business – in Taiwan.
Techneglas Inc., which made glass for television sets, shut down in August and filed for Chapter 11 bankruptcy protection. With that announcement, nearly 700 people here who had devoted decades to a factory that consumed their holidays and weekends and babies’ growing years were knocked off their footing in the nation’s middle class. They made good wages — as much as $21 an hour — that are not easy to replace, and the fate of their pensions and health care coverage is in doubt.
… In announcing that it was closing, Techneglas, a unit of Nippon Electric Glass Co. of Japan, said it will open a plant in Taiwan and expand production in South Korea and Japan. It blamed overseas competition and declining demand for closings that threw out of work its 670 employees in northeastern Pennsylvania, plus 382 in Columbus, Ohio.
… Techneglas has said it does not have the money to pay employees the pensions they are due….
Again, we – and our children – will likely get the bill and workers will get a fraction of what they were promised.