THK op-ed in Boston Globe: "Playing roulette with retirement"

[WildEyedLiberal]

Link: http://www.boston.com/news/globe/editorial_opinion/oped/articles/2006/09/01/playing_roulette_with_retirement/

Snip:

PENSION LEGISLATION recently signed by President Bush may, thankfully, help ensure that workers currently covered by pension agreements with their employers get the checks they were promised -- at minimal cost to the American taxpayer. Unfortunately, it does nothing to reverse the larger, more ominous trend: that of employers walking away from traditional ``defined-benefit" pensions. Congress and the president have taken steps to resolve the immediate crisis, but the long-term problem of retirement security remains.

Not everyone is upset that defined-benefit pensions are rapidly becoming a mirage. In the corner offices occupied by senior corporate executives, this latest retreat from company loyalty is considered good business -- another way to pump up profits. Among middle-class families, the reception should be less joyous, as it means a less secure retirement for millions of people.

.....

But in the end, the elimination of traditional pension plans is just one more way in which corporations are forcing the risks inherent in a dynamic economy onto the backs of middle-income workers, while insulating senior management from those risks. For those CEOs and CFOs, the retreat from defined-benefit plans has little effect. They can look toward handsome severance (excuse me, ``retirement") packages and will depend very little on the performance of their 401(k)s.

In recent years, there has been a tendency to view the US economy purely in terms of numbers -- quarterly earnings, stock prices, and so on. The shift toward defined-contribution retirement plans may make those numbers look a little better. But putting retirement planning in the hands of workers with no financial training and staking retirement funds on a game of Wall Street roulette makes retirement look a lot worse for real people . Companies, and the federal government, should be looking for ways to rationalize the payment of defined-benefit plans so that it takes into account both the needs of companies -- and the need for workers to have a determined income stream.

Excellent editorial and I agree - cutting pensions are just one more way companies maximize profit on the backs of their workers.

As an aside, can anyone imagine Pickles writing an editorial like this?

[karynnj]

1. Pickles - no, neither the intelligence or compassion needed

I think Teresa's image in 2004 was distorted more than her husband's. This is wonderful.

It also is similar to Kerry's comments in committee that spoke of a 3 leg stool that supported people in retirement. The three legs were pensions ( which it is becoming less likely people have), Individual savings, and social security (which the Republicans were trying to destroy). (caveat - remembered from the Social Security hearings, I think in the Finance committee - remembered because I liked the imagery.) I

[ProSense]

2. Excellent! I love this:

But in the end, the elimination of traditional pension plans is just one more way in which corporations are forcing the risks inherent in a dynamic economy onto the backs of middle-income workers, while insulating senior management from those risks. For those CEOs and CFOs, the retreat from defined-benefit plans has little effect. They can look toward handsome severance (excuse me, ``retirement") packages and will depend very little on the performance of their 401(k)s.