Skip to main content

The Corporate Attack on Pension Plans

While George W. Bush’s attempt at privatizing Social Security famously failed, private industry has largely been successful at shifting their group pension plans into individual private accounts. In fact, for many people, traditional defined benefit employer-sponsored pensions are something they are not even familiar with. Most of us are used to 401(k), IRA, or other defined contribution plans, if we even have such a plan. These individual accounts (sometimes employers match funds up to a certain amount, many times they don’t contribute anything at all) are almost always invested in the volatile stock market. They essentially absolve companies of any financial risk associated with retirement and firmly place that risk on the back of each individual employee.

Because of the large amount of non-unionized industries, and the class-collaborationist ideology of many union bureaucrats in the industries that are, there have been few attempts to fight this blatant rollback of gains made in the past by the Labor Movement. Many of these individual retrement accounts were legalized, with little to no opposition, in the late 70s as a supplement to existing pension plans. Companies, however, soon realized they could use them to undermine the government-guaranteed benefits provided by pensions. Management set up separate retirement accounts for them, accounts that guaranteed them healthy returns, and shifted rank and file workers into these newly legalized private individual accounts that are subject to the chaos of the stock market, where returns are uncertain at best. By the 1990s, corporations typically paid less than half of what they used to for their employees’ retirement accounts. Since then, it has only gotten worse.

Even if you are one of the few to have kept your traditional pension plan, companies are using the current crisis of Capitalism as an excuse to freeze pension accounts and even steal money from them in order to subsidize their market mishaps. If all else fails, companies simply declare bankruptcy and have their workers, as well as other workers across the country, bail them out with public tax dollars.

Nine of the ten largest pension defaults in history have happened since 2000, leaving the Pension Benefit Guarantee Corporation, which was set up by the government in order to protect retirements benefits against such practices, deeply in debt.

With the Federal government, as well as many individual states and local governments, facing a huge budget crisis, workers with pensions find themselves in the precarious situation of bailing out their old employers with tax dollars in order to keep their promised benefits, while at the same time seeing many of the social programs that benefit the general public defunded to the point of being ineffective and sometimes completely shut down. Big Business and their political servants use this to divide the working class by blaming “greedy union workers” for demanding what is rightfully theirs, and should be the right of all workers.

When issues like this are brought up, by the mainstream press or even by friends and family, it is often assumed that the capitalist class has a role to play in finding a solution. Union leaders have also told us this for years, that we all should get together, sit down at a giant metaphorical table, and find something that works for all. When this happens, the “right” of the corporations to make a profit is never even questioned. Why is this?

When we ask ourselves this question, it becomes clear that Capitalism itself is the problem. Our interests are in direct contradiction with those of our bosses. The capitalist class must make a profit off our labor in order to ensure their economic, social and political power. Obviously, this is an over-simplification of class relations in society, but it is a basic point we can bring up as we explain our ideas on a daily basis. Instead of simply asking for a seat at that table, we need to demand the whole thing. After all, we made it.

Comments

Popular posts from this blog

Austerity Ecology and The Collapse-Porn Addicts

I just finished Leigh Phillip’s left defense of humanity, “Austerity Ecology And The Collapse-Porn Addicts.” I think it’s important to frame it that way, as one of the main point he makes (and I fully agree) is that the earth doesn’t need us to survive. What we should focus on is our species. And not just surviving, but prospering, even conquering (I know people don’t like that word, but we ought not be scared of power). Phillips goes through every argument that I grew up with, from green austerity to that overpopulation nonsense, and convincingly does away with them. (I read Derrick Jensen was I was younger and had completely spaced out how truly terrible his arguments are. Embarrassingly bad. When I tried John Bellamy Foster I luckily found him too dense to get through. Just like George Ciccariello-Maher is a caricature of your “edgy” left wing professor, Foster is a caricature of what a Marxist is, tough to understand but you should know what he’s saying is super important!) 

Phill…

Hollywood Award Shows are Basically Advertisements for Trump

Given the “resistance” has grounded itself in moralism, it’s perfect Oprah Winfrey is the latest hope. She has trash politics, but gave a speech that sounded wonderful but would have only really mattered before #metoo had “startup” potential. Oprah Winfrey is a retired billionaire in charge of a media empire. She surely could have revealed that Weinstein was a predator, an open secret within Hollywood, without losing her livelihood. Instead she was giving him kisses on another one of those fancy Trump ads. Do we still wonder why calling Trump a hypocrite isn’t the devastating political argument many liberals imagine it to be?
I’m listening to Christopher Hitchens’ fine collection of essays, “arguably.” I’d read many of these years ago, but had forgotten how good of a writer he was. Listening to him take down JFK is pure poetry. However his post 9/11 theme, that fundamentalist Islam is the threat most comparable to 20th century fascism for the enlightenment influenced democracies, stands on even shakier ground today. His realpolitik version of Trotsky’s “permanent revolution” had our enlightenment influenced democracy with Puritan characteristics as some sort of revolutionary regime spreading the best we can do to some despotic areas. It’s quite a twist that Iraq ended up being a boon to Iran, which caused the gulf monarchies to freak out. Of course Trump and his goons are now trying to make amends by demonizing Iran to an absurd degree. I wonder if America allying itself with al-Qaeda in Syria would be enough to cause Hitchens to rethink some things? Maybe his weird hatred for the Baathists extended to the…