General Motors Pensioners

[good to go]

Do you think that the pensioners should be saved with the tax payers money?
Post your answers please.

 

[I Claudius]

Apparently they never contributed to the fund.

 

[good to go]

http://www.theglobeandmail.com/servlet/story/LAC.20090409.RPENSIONS09ART1942/TPStory/Business

Here is a story about the problem.

http://www.thestar.com/Business/article/537478

 

[oldjones]

I wish it wasn't the case, but quite some time ago our government got into the pension-insuring business, to help out their corporate buddies who would give them directorsips when they retired from politics eg. Bomber Harris on the Magna Board. They promised.

Someone's gotta stand by their obligations. Industrialists haven't got the brains or the balls to, only the greed to serve themselves first. Same for pols but their greed was for power. None of them can be trusted to keep their promises.

So it'd be us taxpayers that hafta do the right thing.
.

 

[Hangman]

"Saved?" Autoworkers are taxpayers too, right? Some context would be appropriate, don't you think?

Apparently they never contributed to the fund.

No,they didn't - but that wasn't a requirement when they joined. No point in blaming them for it now, is there?

http://www.reuters.com/article/marketsNews/idCAN0928614020090409?rpc=44

Part of the funds GM would have contributed to its pension plan were channeled into a provincial "pension benefit guarantee fund," designed to ensure that if companies go under, retirees would still receive their pensions.

That fund has about C$100 million in it, Ontario Premier Dalton McGuinty said on Wednesday.

McGuinty said the amounts paid by companies into the pension guarantee fund were "grossly inadequate" and that the fund "comes nowhere near meeting any liabilities for the auto sector alone, to say nothing of all the other sectors."

He said the province does have a political and moral responsibility to pensioners who played by all the rules.

So maybe the government can't fully fund the pensions, but the people who did what they were supposed to should have some kind of remedy. Perhaps not the full amount, but something.

Either way the taxpayers will pay to keep these people alive, whether it's a pension payment or CPP and welfare until they die, right?

Now, I also happen to think that these autoworkers should have put something away for their retirements. I'm sure many didn't bother, and spent all their money.

But who would have thought that GM or other automakerts would go bankrupt when you began a career 25 years ago? They accepted a sweetdeal, and now it's fallen apart. They shouldn't be punished for it.

There's no point in blaming the individual autoworkers. There's a lot of emotion and value judgement in these arguments. At the end of the day thos people need income to live on, and being mean about them is not

 

[landscaper]

I wish it wasn't the case, but quite some time ago our government got into the pension-insuring business, to help out their corporate buddies who would give them directorsips when they retired from politics eg. Bomber Harris on the Magna Board. They promised.

Someone's gotta stand by their obligations. Industrialists haven't got the brains or the balls to, only the greed to serve themselves first. Same for pols but their greed was for power. None of them can be trusted to keep their promises.

So it'd be us taxpayers that hafta do the right thing.
.

The change in the pension contribution rules was the Rea govt not HArris, there was a huge uproar at the time because something like this could and in fact has happened.

The government has a responsibility to the tax payers of the province, that means all the tax payers.

The union is up screaming that the govt has to DO SOMETHING , in the 20 years since the rules changed about contributions the union has not seen fit to make the contributions a barganing issue as they could and should have. Now that the pensions are in trouble it is up to SOME ONE ELSE to fix the problem.

The union can and should use as much of its available money as is nessisary to fund the pensions. When it is broke the tax payers can then think about helping.

 

[Hangman]

This is my problem with a bailout. The labour pay structure is/was indeed a sweet deal, and arguably at least contributed to the demise of the Big 3.

So now we, the taxpayers, are being asked to uphold this sweet deal.

That's about it. It sucks, but what's the alternative?

We're talking about retirees here - they can't just go get jobs. After a while they'll be really old. We can't just let them freeze and starve, so we'll either pay them pensions or welfare till they die. And given our medical care (pretty good compared to the rest of the world) they'll live a long time!

Again, I don't propose that we fully fund those sweet pensions, but we are going to pay something, one way or another. I think it's part of living in a modern society...we don't let Darwin care for the elderly

 

[mac]

it will be interesting that when GM goes into court protected restructuring whether they try to stick it to the Ontario governement with these unfunded pensions. My guess is that if Ontario gives them post restructuring bailout money, they won't. Either way, Ontario will be on the hook for more cash to GM. Chrysler? My guess is that they will be thrown under the bus by the US and so Ontario will have to deal with the pension stuff and a bleeding auto parts industry. My personal vote is to cut bait but the Ontario governement who has to be re-elected won't view the situation through the same lense that I use.

 

[Malibook]

Unless they are going to set up a pension plan for every taxpayer without one, fuck this bailout bullshit.

If they have to get by with reduced benefits, CPP, OAS, savings, investments, and part-time work, so be it.

I also think it is ridiculous that taxpayers match the pension contributions the teachers make.
If there is to be any taxpayer assistance for the autoworkers, it should be diverted from the teachers, not piled on to the already struggling taxpayers and their kid and grandkids....

 

[fuji]

So it'd be us taxpayers that hafta do the right thing..

I voted "no" for one simple reason: I believe these guys have been overpaid for a long time, and that the reason why the company is going bankrupt is that they are overpaid. As a result the pensions they are "owed" are roughly twice as generous as they should really be.

Perhaps the taxpayer should step up and cover half of it, which would mean paying them a pension in line with what they would have got had they been earning a reasonable salary in the first place.

 

[oldjones]

This is my problem with a bailout. The labour pay structure is/was indeed a sweet deal, and arguably at least contributed to the demise of the Big 3.

So now we, the taxpayers, are being asked to uphold this sweet deal.

Arguably yes. We said we would.

 

[fuji]

The union can and should use as much of its available money as is nessisary to fund the pensions. When it is broke the tax payers can then think about helping.

Good point. The government should liquidate all of the assets of the union and deposit that to the pension fund.

 

[realthing69]

Perhaps the taxpayer should step up and cover half of it, which would mean paying them a pension in line with what they would have got had they been earning a reasonable salary in the first place.

I think that is fair settlement...but I got this feeling the CAW will want it all...

 

[fuji]

Arguably yes. We said we would.

When did we say that? We said we would set up a pension guarantee fund that would be funded by the private sector. I don't think we EVER said the taxpayer would be on the hook for this.

Question -- had we allowed GM to go bust back then how well funded was the pension plan at that time?

I still think a fair outcome here is that we fund some fraction of it rather than the whole amount, and that we liquidate all of GM's assets and all of the union's assets in the process.

 

[oldjones]

Unless they are going to set up a pension plan for every taxpayer without one, fuck this bailout bullshit.

If they have to get by with reduced benefits, CPP, OAS, savings, investments, and part-time work, so be it.

I also think it is ridiculous that taxpayers match the pension contributions the teachers make.
If there is to be any taxpayer assistance for the autoworkers, it should be diverted from the teachers, not piled on to the already struggling taxpayers and their kid and grandkids....

So where were you saying all this last election: Federal, Provincial or Municipal. Not like the need for pensions or the government guarantee was any secret. Nor was the government guarantee of them, Harris, Rae and McGuinty have all gone along w/ that deal.

We don't get to renege on a deal just because we slept while our reps signed it. What kind of a country would we have then? Who would ever believe anyone's word?

Anyway, I look forward to your spirited campaign in favour of good pensions for every taxpayer, since you hold deals employers and employees make to be unconscionable.

 

[Rockslinger]

These retired GM workers sucked on the teats of GM when they were working the line and now they want to suck on the teats of Ontario taxpayers. Absolutely, no way! The CAW should have known that the contracts they squeezed out of GM under threats of strikes were unaffordable and unsubstainable. (There are 3 retired GM workers to every active one.)

 

[oldjones]

When did we say that? We said we would set up a pension guarantee fund that would be funded by the private sector. I don't think we EVER said the taxpayer would be on the hook for this.

Question -- had we allowed GM to go bust back then how well funded was the pension plan at that time?

I still think a fair outcome here is that we fund some fraction of it rather than the whole amount, and that we liquidate all of GM's assets and all of the union's assets in the process.

Several years ago—the last time the carmakers couldn't manage their affairs to keep their promises—we, the people of Ontario, said we'd forgive the required annual payments to the Guarantee Fund. And we, the same people of Ontario, were the ones who made it such a sweet deal for the companies that the fund was inadequate, but we said we'd be the insurer against that possibility. That goes back to the beginning. Because employers (not just carmakers) screamed about the injustice and impossibility of ensuring they'd have the money they'd promised when it was time to pay, and hey, they're the guys who lunch with pols and give them jobs, not smelly union guys.

It's why the taxman wants you to prepay, y'know.

I'm 100% with you that we liquidate the assets of employer—inventory, plants, GMAC, real estate, dealer debts—and union—office furniture and a bulding or two, whoopee—to fund the shortfalls, but in proportion to their unmet obligations from the past. Given that all 'unmeeting' was done by contract, cabinet order and so forth that's one hell of a Godian knot to unravel. And every tug and tease of that process will make it harder for anyone ever to trust a promise, a contract or a law again.

And I'd kinda imagine the workers' contributions had been kept up to date all along.

PS: Wanna bet when we're selling assets and nicle-and-diming retired welders outta their pensions, the execs who ordered those welders to build money-losing cars, lied about profitability, and failed to do contracts the company could actually afford will have already put through their multimillion dollar final cheques and topped up their own pension accounts? Wanna bet they're just a tad more generous than the welders month by month?

They've already taken our money, so we're backing those cheques. How be we stop jealously squeezing workers who just did their jobs and started going after the guys who demonstrably did not do theirs. When you back a welder' s pension for Wagoner and his ilk, then you guys'll be making sense.

But comme toujours, they could count on envy to distract, while they've made off like bandits. Still working; see above, just about any post.

 

[james t kirk]

Simply put - No.

We can't afford this kind of socialist stupidity.

Going forward, I think that any company needs to analyze it's pension plan, or the concept of a pension. There's too much obligation, there's too much of an incentive for companies to cheat, there's too much greed, everything.

Canada pension is one thing as they simply can increase the rates we pay to cover it and if it goes broke, well, that means the whole country is broke.

If I was GM or Chrysler, or Ford, the one thing I'd be going after is the abolition of the company pension plan. Set up an RRSP plan where the company matches the contribution up to a point, etc.

Now I realize that they can't do this with guys who've been working at GM for 25 years, however, those with 5 years or less could be bought out, all new employeers joining the company - this is what you get. In time, as the pensioners die off, the problem corrects itself.

 

[maurice93]

Going forward, I think that any company needs to analyze it's pension plan, or the concept of a pension . There's too much obligation, there's too much of an incentive for companies to cheat, there's too much greed, everything.

They have... pension plans in a non-union or non-public sector environemnt are almost all defined contribution plans with no obligation from the employer beyond the initial contribution.

 

[oldjones]

They have... pension plans in a non-union or non-public sector environemnt are almost all defined contribution plans with no obligation from the employer beyond the initial contribution.

That's the current concept, but the GM-style promised payout was long the norm. As long as no one forced companies to prove they could afford their promises, required them to actually have and put aside the money, employers could always sweeten the hard to cost down-the-road pension promise at contract time, instead of giving raises that their secretarys could cost on a napkin over lunch. And the unions took their word.

Instead of properly funding their obligations, they often paid them from their current accounts. Not just carmakers, most employers who'd folowed their lead. It's called a Ponzi scheme; new entrants pay off the old. Works fine as long as you're growing with the economy, and as long as your pensioners die off promptly. Bit if the medical care you also never costed keeps them alive longer …. You gonna hafta sell a lot more cars.

Sadly, instead of policing the scam, successive governments participated. Seemed cheaper and easier to be the insurer of last resort for the fortunate few, and pay out the occasional bankrupt company's obligations than to require properly funded, self-financed pensions for all I guess. And that's why we're now on the hook in Oshawa and Windsor.

The current fad: Defined Contribution (contributions have always been defined, what's changed is: No Promised Payout—just like that RRSP that shrunk over Xmas) at least usually sets up independent fund holders. I can't be the only one who recalls that employers used to 'hold' employees' contributions along with theirs until the temptations to loot became overwhelming. Which they did on a regular basis. Conrad Black and the Dominion Store Fund anyone? When the pot's big, morals shrink.

Face it folks, we the people are always and will always be each others' insurers of last resort. It's high time we demanded our pols stop taking their bum buddies' word for it that, "the monies all there" and actually demanded, "Show me the cash". Or this will just happen again.

And punishing aging windshield installers won't fix anything.