In 2012 corporations are permitted to discard the legal rights of America’s retirees and simply ignore federal ERISA laws meant to protect our pensioners. This is creating a dangerous and potentially devastating trend.
This summer, GM disposed of $26 billion of its retirees’ pensions by purchasing insurance company annuities or offering others buyouts. Then in late October, Verizon announced it’s forcing 41,000 of its management retirees into Prudential insurance annuities, with no choice or voice in the decision.
What this means is that these retirees will lose both federal ERISA pension law protections and the safety net that the federal government’s Pension Benefit Guaranty Corporation (PBGC) provides.
Corporate pensions are protected by the PBGC, but annuity policies are not, so if an annuity issuer goes bankrupt or suffers an asset shortfall, retirees are up a creek without a paddle.
Are we all forgetting the financial meltdown of 2008, when many too-big-to-fail insurers and financial firms sought out the federal government as their financial safety net? Who in Washington is looking out for America’s retirees? Our leaders need to wake up and stop corporations from pulling these pension bait and switches on older Americans.
Frederic Burns, Fort Lauderdale
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