Pension Plans, capitalism and the future...

[PrincessFiona]

Is anyone else disgusted with the fact that big companies like United Airlines can file for bankruptcy and just....do away with their employees pension plans while the CEO's have special 'protected' multi-million dollar accounts that can't be touched? It's true that the PBGC will cover parts of their retirement benefits, but that means it comes from our tax dollars.

I know that September 11 hurt the airlines, but something that has also hurt them is the continued dwindling services that they offer, the cost of gas and the fact that the airlines traditionally do not put away very much money for the leaner times. The airlines pay their CEO's OUTRAGEOUS salaries and bonuses and do not set aside a good amount of money for the leaner flying months...as a result, they have a constant hire/fire cycle. My dad flies for American and it's a ritual with the airlines. Instead of anticipating the slow months and planning appropriately, they always just let the last people hired go..and they always hire the next time around for less money/benefits.

This is really capitalism gone wrong! Actually, this is why I think uncontrolled capitalism can't work. I think, for example, that CEO's should be able to have a 'sky's the limit' salary as long as every employee has a basic healthcare and pension plan no matter how low on the totum poll they are. This might mean that instead of 37 million a year that the ceo might only earn 7 million..but I think 7 million is respectable too.

A select few are getting to the top by stripping the working man of his retirement, healthcare benefits and a living wage.

kris

[Meenah]

If I really let loose and posted what I think, I would be either arrested or banned from the internet.
Luanne

Luanne, you crack me up.

I think the whole pension thing is a shame. Especially because a lot of the pilots affected will end up getting a lot less than they expected. And since there is a mandatory retirement age for pilots, it's not like they can just go back to work.

Regarding the salaries, I think CEOs should get paid a lot, but not as much as they do. It's absurd in some cases. But, I don't think it should be addressed legislatively. IMO. :!

[PrincessFiona]

How do you think it could be better addressed? I'm not crazy about the legislative route either...I just don't know how else it could be addressed. My dad is getting ready to retire from American Airlines (September) and he feels it is a risk right now because American is expected to go through the same type of bankruptcy by November.

I don't know....shareholder action?
I'm sure the response to that would be, how do you get a good CEO if you don't compensate him/her at the going rate? If it happened with a bunch of the big corporations as a group, that would help.

[PrincessFiona]

Shareholders are interested in their bottom line though only...so I don't think that they care if workers benefits are being cut as long as they see the return on their investment.

A CEO should be compensated, but the market has overinflated what they are worth....AND how can a CEO be 'worth' so much money when they are basically running their companies down into bare bones structures that mistreat their workers? How is that valuable to society? At the end of the day, their only 'value' then is in some etherial financial aspect that benefits only a select small group.

:>

kris

I know I am being idealistic....but a large salary does cut into a company's bottom line. It might not be much in the scheme of their entire financial picture, but it is money that can't go other places -- capital investment in the company, debt management, dividends, etc. It is harder to quanity treatment of employees but I think that some arguement could be made.

I'll be over here in the corner standing in a pool from my liberal bleeding heart... :!

[PrincessFiona]

I know I am being idealistic....but a large salary does cut into a company's bottom line. It might not be much in the scheme of their entire financial picture, but it is money that can't go other places -- capital investment in the company, debt management, dividends, etc. It is harder to quanity treatment of employees but I think that some arguement could be made.

Do you mean a large CEO salary?

There are no easy answers...and I don't really see change ever coming, really...It's just too bad that as we are talking about social security going bankrupt and possible partial privatiazation of social security we are also talking about people losing large parts of their retirement benefits.... :|

Yes, I did mean large CEO salary. Who knows if there will be a change. I think that Warren Buffett has called compensation an "acid test" for corporate reform. He is a vocal critic of CEO pay -- and a big shareholder. Maybe there will be enough momentum someday.

This privatization thing just drives me nuts!

Before 1929 people were invested in the stock market, and were saving money in banks.

The market crashed, and there was a run on the banks.

Life savings were gone.

Privatized savings and investment being risky is why they instituted SSI in the first place!

SSI is a safety net so you can at least make ends meet, it was never meant to be the whole retirement funding.