How does one interpret a company disappearing or going out of business like the steel manufacturers as pension plans are not guaranteed by the feds. The funny thing about private companies going out of business, unions have bleed these companies so hard that their membership has suffered over time. http://sg.wsj.net/public/resources/images/ED-AK923_1union_NS_20100202181620.gif http://voteview.com/images/Union_Membership_1930-2005.jpg
Another first, Scranton, PA city employees having their salaries cut to minimum wage. Meanwhile, no talk of either candidate ending corporate subsidies or holding those on Wall St accountable. This is austerity.
Considering many pensions put money into the very mortgage securities that were fraudulently labeled as AAA by the rating agencies and sold off and packaged by banks (who were handing out mortgages to everyone since they knew they could pawn them off onto things like pensions), I don't consider that to be all on the pension. Pensions as they are structured are unsustainable but what happened in 2009 was criminal and we're letting pensions crash but refuse to do anything to the jokers on wall street that made this mess. Even when you gamble, the rules are generally pretty clear. In this case, investors were being flat out lied to. Even Vegas doesn't blatantly lie like that.
Filing for bankruptcy may not be the end. There were airlines who filed for bankruptcy in the 1980's as a clever way to renegotiate pension plans with the pilots' union.
Times are tough in California? I take it this means San Bernadino will file for bankruptcy soon. Much of the blame is placed on defecit spending and pensions. How will this affect these government bodies ability to provide future services and facilities? Did they bankrupt their infrastructure for comfortable pensions and wages?
Good article I read relating to the failure of public pension plans and the LIBOR scandal. Banksters and their greed Will there be any accountability or is the solution to just force public workers to accept minimum wage & food stamps and have cities file for bankrupcty and further pass the buck on to the city's vendors [no doubt small business] while the collusion that has taken place among the banking outfits avoids reconciliation? Good thing we bailed these guys out in 2008.
Wel, yeah. Often times they have done so on the basis of misinfo from "Wall Street" or local financcial advisers with the same mind set trained in the same biz Schools and reading the Wall Street Journal.
You can thank the FASB and their changes in the late 1980s for the demise of pensions and the rise of the 401k. Especially to blame is FASB 87, adopted in December 1985.
Calpers not doing well either: http://www.cnbc.com/id/48203539 Generated a 1% rate of return, with a ridiculous target rate of 7.5%. There's no way in hell they are going to average a 7.5% rate of return in this environment without taking on excessive risk. In the last 10 years, they've averaged under 6%; over the last 5, an average of 1.2%.
