Tuesday, May 10, 2005

 

Pension Woes At United

United Airlines received permission from their bankrupcty judge to release them from roughly $3.2 billion of pension liability. Of the $10B that's underfunded in the plan, the federal Pension Benefit Guaranty Corp. will now be ask to pick up $6.6B. That's actually us, the taxpayers, picking up the tab for obligations made by management that's long-gone. Great.

If Ford or GM go into bankrupcty, this will likely set a precedent. Whether the unfulfilled obligations get guaranteed by the feds is another question altogether. Ask a retired steelworker how things turned out for them, even with partial coverage through PGBC.

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