Would you support a PBGC Bailout

[TheAnvil 0]

OK. As food for thought, would any of you who know what the PBGC is support federal $$ being used to bail it out if/when it goes bankrupt?

I say hell no, but that's just me.

Vinny the Anvil
Post Traumatic Didn't Make The Lakers Syndrome is REAL
JACKASS POWER!!!!!!

[idrankwhat 0]

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OK. As food for thought, would any of you who know what the PBGC is support federal $$ being used to bail it out if/when it goes bankrupt?

I say hell no, but that's just me.

It will go bankrupt so long as it's being abused the way it is. Personally, if the corporations can't meet their contractual obligations, or more to the point, choose not to, then all of the leadership in those companies should be stripped of all their assets and retirement benefits before the US bails them out. Fuck 'em. They ran the business poorly. They should be the ones who take the hit, not their employees who met or exceeded the requirements for employment.

[rehmwa 2]

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then all of the leadership in those companies should be stripped of all their assets and retirement benefits before the US bails them out.

where do you personally draw the line in the sand in a generic company? (since 'leadership' messes up and all the 'others' perform so admirably)

just the BOD? all the VPs and up? directors? senior managers? first level managers? supervisors? project leaders? work supervisors? shift leaders? mentors?

only salaried people?

Or just pick 3 or 4 people of high visibility to sacrifice regardless of their performance to make the rest 'feel' good.

I just wonder where you think corruption 'automatically' starts and stops in a big corporation if we can't go and figure it out on an individual basis with no bias based on position, economic status, etc...

edit: I don't think gov bailouts are a good idea in general. And I'd also like mas tequila por favor.

...
Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[wmw999 2,589]

I don't think gov. bailouts are a good idea either. But I think that waiting for companies to do the right thing with the big piles of money that come with properly-funded retirement plans will not end up with more properly-funded retirement plans.

So -- right now, we still have a lot of people (including me) who are expecting money from retirement plans. It formed part of their decision on taking/staying with jobs. They thought about it. Hopefully most of those folks will get to collect that money.

Some won't. So do we revile them for their choice of employer? Spend more government money in oversight? Bail out the companies? Or just wait for them to die because all young people now know that they won't be getting any money they don't set aside themselves.

I think it sucks that companies with large-salaried executives can "make a decision" to simply turn over some of their less convenient obligations, and then continue without penalty. Which is, effectively, what's happening. It's like easy bankruptcy.

I don't have any answers. But after reading lawrocket's rant about no longer being able to overestimate the depravity that people are capable of, I'm sure not real hopeful about corporate or individual behavior without oversight, either.

Wendy W.

There is nothing more dangerous than breaking a basic safety rule and getting away with it. It removes fear of the consequences and builds false confidence. (tbrown)

[idrankwhat 0]

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where do you personally draw the line in the sand in a generic company? (since 'leadership' messes up and all the 'others' perform so admirably)

just the BOD? all the VPs and up? directors? senior managers? first level managers? supervisors? project leaders? work supervisors? shift leaders? mentors?

only salaried people?

Or just pick 3 or 4 people of high visibility to sacrifice regardless of their performance to make the rest 'feel' good.

That's a damn valid question and I don't know that I have a good answer for it. I guess I'd probably have to pick some sort of a multiplier figure, like (just grabbing a figure) 20 times the average worker's salary. I probably need to hit the reposado and 'tink on this a while.

[rehmwa 2]

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guess I'd probably have to pick some sort of a multiplier figure, like (just grabbing a figure) 20 times the average worker's salary.

So evil can be defined strictly by an income break point?

I hope you are being goofy (I know you were).

I was talking about not being lazy and doing exactly that, but by looking at each individual's actions and making the call one at a time.

Else, we could just head off future problems and torture and ruin every person who has over X number of dollars to their name. Preemptively of course.

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[lawrocket 3]

I say "Hell No."

Obviously, people would suffer is the PBGC goes bankrupt. About 45 million Americans have pensions that are guaranteed by the PBGC.

A year ago, United Airlines defaulted on its pension plan because of its bankruptcy, which passed this pension on the the PBGC. The PBGC pays half of the pensions. The retirees bear the 50 perent loss.

The PBGC faces similar problems with plenty of companies and probably hundreds of billions in pension claims. Why? 30 years ago, pensions were offered as defined benefits guyaranteeing income for the rest of people's lives. Then people began to live longer. And longer. And longer.

The issue with the PBGC lies in the political problems. Like many governmentally designed programs, it was programmed to offer market-level guarantee for below-market prices. Insurers who offer services below market level go extinct in most spectacular fashion. In fact, most businesses that offer financial guarantee without proper market analysis

It works in insurance and surety. Google "Commercial Money Center" for soem scandal on market-rate services on sub-market rate risks.

So, what we have is a situation where pension funds are growing out of proportion to the amounts owed. Many of these pensions are badly underfunded. So the PBGC steps in to take them over. The issue is that the PBGC is also underfunded now for the same reasons as the plans they are set to take over, in addition to the Congressional directives.

Because of pensions rules, when the times were good in the late 1990's, the growth of the pension values would allow companies not to put cash in the pensions - the growth would qualify. So more than half of all companies didn't put any money in. When the market dropped, so did the values, with little cash infusion for many years. Even during those great times, pensions were underfunded by a total of about $20 billion. The 2001 recession brought the underfunding to over $250 billion by 2002.

So we've got the governmentally created PBGC. What happens when somebody else is there to take up the slack? That right, people will use that person to take up the slack. Why worry about poor management if the gubment will cover it? Since the PBGC is mandated to cover these plans, corporations can do risky things with minimal risk - the taxpayers will take over.

A bailout is nothing more than the prevention of a market correction. The PBGC absolutely could not exist in a free market. Elaine Chao, the Secretary of Labor, proposed bringing the PBGC up to proper fundingby increasing the premium.

Why the hell should we, as taxpayers, bail out companies who cannot keep their word? Ten million people may suffer a lot without a bailout. 150 million people may suffer a bit with a bailout.

Had the market been allowed to operate as a market, perhaps the inducement to rely on the taxpayer would not have been there to begin with.

My wife is hotter than your wife.

[Gawain 0]

I say "no". Curious, is there some news going on about them that I've not heard about?

So I try and I scream and I beg and I sigh
Just to prove I'm alive, and it's alright
'Cause tonight there's a way I'll make light of my treacherous life
Make light!

[TheAnvil 0]

No dude, I was just thinking about it the other day. I think there was an article about it in The Economist a few weeks ago.

Vinny the Anvil
Post Traumatic Didn't Make The Lakers Syndrome is REAL
JACKASS POWER!!!!!!

[kallend 2,150]

With tens of millions of Boomers about to retire, no politician can afford to let it go Tango-Uniform.

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The only sure way to survive a canopy collision is not to have one.