DAYflyer
Topic Author
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DL/NW Potential Pension UAL Style

Wed Jun 08, 2005 5:00 am

DN & NW speak of potential bankruptcy over pension issues, sounds like another pension going the way of UAL .

http://www.foxnews.com/story/0,2933,158837,00.html

I dont think it will be too long before all airline pensions go belly-up.
One Nation Under God
 
Cory6188
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RE: DL/NW Potential Pension UAL Style

Wed Jun 08, 2005 5:03 am

Would the PBGC ever be able to handle all of these absolutely huge pension funds? It seems like a ton of money for them to suddenly become responsible for.
 
commavia
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RE: DL/NW Potential Pension UAL Style

Wed Jun 08, 2005 5:13 am

That would leave only AA and CO fulfilling their traditional pension committments.
 
DAYflyer
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RE: DL/NW Potential Pension UAL Style

Wed Jun 08, 2005 5:16 am

Everybody knows where this is headed....and the US taxpayer will be stick footing the bill for the PBGC.
One Nation Under God
 
DAL767400ER
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RE: DL/NW Potential Pension UAL Style

Wed Jun 08, 2005 5:58 am

It is only a matter of time before AA and CO want the UA-treatment as well. And who could deny them that wish? Otherwise, it would give UA a huge financial advantage over its competitors.
 
positiverate
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RE: DL/NW Potential Pension UAL Style

Wed Jun 08, 2005 7:25 am

Delta was advocating legislation that would let them stretch out their pension payments over a logner period of time and make them more manageable.
 
atmx2000
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RE: DL/NW Potential Pension UAL Style

Wed Jun 08, 2005 8:39 am

Quoting DAYflyer (Reply 3):
Everybody knows where this is headed....and the US taxpayer will be stick footing the bill for the PBGC.

Since pension problems seems to be so concentrated in a few heavily unionized industries which rather rapidly got exposed to competition (carmakers and steel industry to foreign competition and airlines to deregulated competition), I suspect we will see industry specific settlements like the Railroad Retirement Act. We might see something retirement policy for the airlines, which will raise revenue from all airlines to pay off some of the older retirement obligations and help airlines shift younger workers from defined benefit to defined contribution plans. If it is an industry specific settlement, the general taxpayer won't pay for it, but rather the customers of the airlines.
ConcordeBoy is a twin supremacist!! He supports quadicide!!
 
halls120
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RE: DL/NW Potential Pension UAL Style

Wed Jun 08, 2005 11:58 am

My brother is a DL pilot who plans on retiring next year - the minute he is eligible. He understands that he will be getting a smaller pension than if he stayed on with the airline until he reaches mandatory retirement, but he figures a reduced pension is better than none at all.
"Suppose you were an idiot. And suppose you were a member of Congress. But I repeat myself." Mark Twain, a Biography
 
DAYflyer
Topic Author
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RE: DL/NW Potential Pension UAL Style

Thu Jun 09, 2005 12:38 am

Quoting Atmx2000 (Reply 6):
Quoting DAYflyer (Reply 3):
Everybody knows where this is headed....and the US taxpayer will be stick footing the bill for the PBGC.

Since pension problems seems to be so concentrated in a few heavily unionized industries which rather rapidly got exposed to competition (carmakers and steel industry to foreign competition and airlines to deregulated competition), I suspect we will see industry specific settlements like the Railroad Retirement Act. We might see something retirement policy for the airlines, which will raise revenue from all airlines to pay off some of the older retirement obligations and help airlines shift younger workers from defined benefit to defined contribution plans. If it is an industry specific settlement, the general taxpayer won't pay for it, but rather the customers of the airlines.

In either case, we lose. I wonder why the government has not monitored and policed this better. Corporations that are not making pension payments into funds they created to attract high caliber workers should maintain liability.

I agree that we probobly will se something like the Railroad Retirement Act. I do find it interesting that this problem hit yet another heavily unionized industry as you said.
One Nation Under God
 
commavia
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RE: DL/NW Potential Pension UAL Style

Thu Jun 09, 2005 11:59 am

Press release issued today jointly by AA and its unions:

http://www.aa.com/content/amrcorp/pressReleases/2005_06/07_joint_letter.jhtml;jsessionid=INZO4HW5PUXJXEAJJM3U1DUQBFFT4VMD

Interesting to see another path.
 
IslandHopperCO
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RE: DL/NW Potential Pension UAL Style

Thu Jun 09, 2005 1:23 pm

What I don't understand is why these defined benefit pensions were set up in the first place. Couldn't the companies and employees forsee that paying these ever growing pensions was unsustainable from the beginning? What a silly ponzi scheme, just like social security.

[Edited 2005-06-09 06:25:02]
 
N801NW
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RE: DL/NW Potential Pension UAL Style

Thu Jun 09, 2005 8:18 pm

Quoting IslandHopperCO (Reply 10):
What I don't understand is why these defined benefit pensions were set up in the first place.

It was apparently the only legal means of funding retirement plans in the 1940's, according to testimony at the Senate hearing on Tuesday. Defined contribution plans either did not exist or weren't legal.
 
filejw
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RE: DL/NW Potential Pension UAL Style

Thu Jun 09, 2005 9:05 pm

What people seem to forget is that this bill is not only to save the airlines from bankruptcy but to let the them pay money owed and already earned by emplyees.Should be no cost to the government.Better than letting it go to the PGBC and stretching that body to its limit.

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