By Ron Legro
Angry Progressives Facebook Page (10/7/19)
So you’re the CEO and chairman of the board of a major international megacorporation and your firm’s bottom line is ailing. What to do, what to do? Why screw your employees big time, that’s what. As usual.
GE (formerly General Electric) a couple of years ago joined the many public and private institutions that in recent years have decided to renege on obligations — many of them contractual through collective bargaining agreements — to claw back promised pension benefits for retired employees. Two years ago GE summarily whacked promised retiree health benefits by billions of dollars. Result: a typical retiree might see his or her annual prescription drug costs go up by a factor of ten.
Back then the company issued a statement after employees and retirees complained at an annual shareholders meeting. The bosses argued that for GE “to succeed in the long term [i.e., raise its earnings and pay its stockholders more in dividends], we need to have a cost structure that doesn’t put us at a disadvantage compared to our competitors — many other large employers have shifted or are shifting to an exchange or defined contribution design, or have eliminated or are eliminating retiree medical benefits altogether.”
That was the camel sticking its nose in the tent. Now GE is whacking pension benefits altogether for some 20,000 of its US workers. This will save the company billions of dollars annually, but only by reaching into the pockets of its workers for those promised dollars. Of course, the CEO’s multimillion-dollar compensation package will only go up thanks to his courageous (not!) move to balance GE’s budget on the backs of workers.
SHAMEFUL. Because in any other realm of American law, this would be called robbery.
Note, by the way, that Republican Party efforts to whack Social Security take precisely the same approach. Well, we spent all those monies for other stuff and failed to reimburse the Social Security Trust Fund as we promised, so (big sigh) we simply have no choice whatsoever but to trim your promised retiree benefits — the ones you’ve already paid for through your payroll taxes.
This is capitalism at its worst. It is why more and more citizens won’t at all be deterred in voting for Democrats and other progressives who push for a more equitable society through social safety nets and other programs that help the increasingly distressed American worker along with the disabled, orphaned, and elderly.
*****
GE To Freeze, Pre-Pay Worker Pensions To Save Up To $8 Billion, Cut Debt
By Alwyn Scott & Ankit Ajmera
Reuters (10/7/19)