The Propaganda War on retirement benefits...

I’m sure everyone has heard lately about ‘The Discussion’ about Social Security. The system is broke, there won’t be enough to pay out benefits, it’s the looming crisis our nation faces and so on and so on and so on...

It has long been accepted as truth that government workers get good benefits and job security in lieu of high salaries, but over the years the gap between public and private employee paychecks seems to have narrowed. It’s hard to come by perfect comparisons, since government numbers for the private sector include lower-wage industries like retailing, which pull down the averages, but overall, public-sector workers look to be getting a pretty good deal. In 2004 average salary for a public worker was $49,275 compared with $34,461 for everyone else, according to the Employee Benefit Research Institute (EBRI).

I’ve been seeing a lot of ink lately about employee benefits. Specifically, employee retirement plans which seem to have fallen out of vogue these days.

Executives at Delta and elsewhere in the airline industry—not to mention at similarly legacy-cost-plagued companies like U.S. Steel and GM—are doubtless closely watching the United deal, which could serve either as a potential bargaining tool to use with unions, or as another inducement to try Chapter 11 themselves. American Airlines, the largest U.S. carrier, has said it will keep its pension plans but is concerned about No. 2 United gaining a financial advantage; Delta is currently making plenty of noise about Chapter 11, even as two Georgia Republican Congressmen are currently pushing House legislation to let airlines spread out payments for defined-benefit pension plans and spread the shortfalls over 25 years instead of the current four. And certainly the United deal adds some spice to baby-boom-in-the-python retirement debates from Social Security to, well, the PBGC, now running its own $23 billion deficit. Will retirement/health plan bailouts be our new S&L crisis?

It seems like everytime I turn around these days, employee benefits are the bane of our society - medical benefits, retirement benefits - these things are just hurting perfectly good companies and the American people! We need to wake up folks! We’ve got to do something about these shiftless, lazy bastards who expect to get these benefits! Unfortunately sarcasm does not translate through the keyboard easily.

So, along with the current discussion about Social Security, we are also facing a time when the responsibility for pensions and retirement plans are shifted onto the American Worker.

Now, what I fail to understand (and if someone can explain the logic of this to me) is how the increasing disparity between the average worker’s salary and benefits and that of a company’s top management can continue to be justified. Everytime I turn around, it seems companies are paying a price for bad decisions made by the people in charge but, instead of getting a reduction in pay - they get huge bonuses in the form of stock options and buyouts.

So, now companies are looking at ways to get out from under their obligations via Chapter 11 while simultaneously our government has made it harder for individuals to declare bankruptcy. Can anyone say, “Class Warfare?”

...more to come.