Attn. United Haters

[skykid]

I have to admit I would have prefered to see UAL liquidated by the pBGC then see the pensions dumped onto the public. My guess is that every DAL and NWA employee feel the same way I do, within the up coming months. All UAL did was open the door for massive pension liability default. The other Legacy carriers will no doubt follow suite. To some how feel that you won the argument is pathetic, you lost your pension and opened the door for all the others to follow. Nothing their to be proud of.

You miss the entire point!! I didn't win any argument! All I'm doing is pointing out you have no knowledge on a subject you love to jump in on. Come on guy, at least Ty Webb, Boeingman or some of these other guys know what they are talking about. The PBGC NEVER had the capability to liquidate United! That's the point. The pensions weren't dumped on the public. You don't have a clue what you are talking about. United didn't open any doors for the other legacy carriers. All the Legacy airlines are going to have to match the cheaper retirement plans of the LCCs - with or without United. I'm not blaming anybody, that's the way business is done in this century.

 

[Redmeat]

United didn't open any doors for the other legacy carriers.

This is not entirely true. United established a court precedent by successfully being relieved of it's (WAY!) under funded pension funds. Bankruptcy is very expensive for a major airline. It USED to be considered a last resort. When suddenly being able to "chuck" huge debt (under funded pension funds) became the precedent in the courts, BK instantly became more attractive to NWA, DAL. NWA immediately devised a plan to take its labor groups to the wood shed by threatening the pilots with BK/their pensions.

 

[WatchYourElbows]

You people should really know the reality before you start spouting off. Are you really this unaware of the truth?

FYI-United did NOT start the pension dump. You may not like the fact that they did it, but once US Air was successful, United just followed suit (just like your company is going to do to YOURS! LOL)

 

[Redmeat]

(just like your company is going to do to YOURS! LOL)

UAL must be very proud of you Captain WatchYourElbows.

 

[Widow's Son]

>>All the Legacy airlines are going to have to match the cheaper retirement plans of the LCCs<<

The retirement plans at SWA aren't cheaper. It would have been cheaper for SWA to have traditional pension plans over the last couple of decades compared to what they have paid in 401k match and profit sharing.
The reason the legacy plans don't have any money in them is because when the market started soaring, the companies didn't make any contributions and when the market tanked the continued not making contributions saying they couldn't afford it.
All the while SWA dutifully paid every dollar of its commitments every month, and the combined contributions as a percentage of employee income almost always exceeded even the most generous legacy pension program of the good old days.

 

[G4G5]

You miss the entire point!! I didn't win any argument! All I'm doing is pointing out you have no knowledge on a subject you love to jump in on. Come on guy, at least Ty Webb, Boeingman or some of these other guys know what they are talking about. The PBGC NEVER had the capability to liquidate United! That's the point. The pensions weren't dumped on the public. You don't have a clue what you are talking about. United didn't open any doors for the other legacy carriers. All the Legacy airlines are going to have to match the cheaper retirement plans of the LCCs - with or without United. I'm not blaming anybody, that's the way business is done in this century.

http://msnbc.msn.com/id/7804770/
“Taxpayers had better buckle up because we will be in for a bumpy ride of bailout after bailout, as more and more corporations dump their pension plan obligations on the PBGC,” said U.S. Rep. Jan Schakowsky, D-Ill., referring to the Pension Benefit Guaranty Corp. that already is operating at a more than $23 billion deficit

Who do you think is making up the difference in the underfunded pension? Sure UAL offered up $1.5 billion is stock but it doesn't cover the deficit

http://www.cegelisforcongress.com/UAL
But the PBGC has now assumed billions in new liabilities. The UAL pension fund is underfunded by $9.8 billion--only $5 billion of which is covered by the PBGC. But that's $5 billion in new debt in exchange for $1.5 billion in UAL securities.

It will take extraordinary stock performance for those securities to increase in value so that they cover the $5 billion PBGC payout. If the value of the stock stays steady or decreases, it will not begin to meet the financial obligations the PBGC has now assumed.

United Airlines Pilot Defined Benefit Plan - covers 14,100 participants and has $2.8 billion in assets to pay $5.7 billion in promised benefits. United Airlines Ground Employees Retirement Plan - covers 36,100 participants and has $1.3 billion in assets to pay $4 billion in promised benefits. United Airlines Flight Attendant Defined Benefit Pension Plan - covers 28,600 participants and has $1.4 billion in assets to pay $3.3 billion in promised benefits.
Management, Administrative and Public Contact Defined Benefit Pension Plan - covers 42,700 participants and has $1.5 billion in assets to pay $3.8 billion in promised benefits

So who were the pensions dumped on?
Sure the employees are feeling the brunt but you are kidding your self if you don't think the tax payers are not going to get hit with a PBGC bailout.

All the Legacy airlines are going to have to match the cheaper retirement plans of the LCCs - with or without United?
How do you explain AMR meeting their pension liabilites with nearly $4 billion in cash?

"United didn't open any doors for the other legacy carriers"
Really the director of the PBGC seems to disagree with you

Indeed, the pensions agency seemed to accept that it will end up allowing further defaults. PBGC executive director Bradley Belt says the agreement "under the circumstances is in the best interests of the pension insurance programme and its stakeholders" because the corporation has an "obligation to reduce its losses" and because the settlement is superior to the recovery that the agency would have received as an unsecured creditor in bankruptcy.
http://www.flightinternational.com/Articles/2005/06/01/Navigation/258/198186/Pensions+battleground.html

 

[G4G5]

>>All the Legacy airlines are going to have to match the cheaper retirement plans of the LCCs<<

The retirement plans at SWA aren't cheaper. It would have been cheaper for SWA to have traditional pension plans over the last couple of decades compared to what they have paid in 401k match and profit sharing.
The reason the legacy plans don't have any money in them is because when the market started soaring, the companies didn't make any contributions and when the market tanked the continued not making contributions saying they couldn't afford it.
All the while SWA dutifully paid every dollar of its commitments every month, and the combined contributions as a percentage of employee income almost always exceeded even the most generous legacy pension program of the good old days.

Your wasting your time trying to explain it to him.

 

[Mugs]

>>All the Legacy airlines are going to have to match the cheaper retirement plans of the LCCs<<

The retirement plans at SWA aren't cheaper. It would have been cheaper for SWA to have traditional pension plans over the last couple of decades compared to what they have paid in 401k match and profit sharing.
The reason the legacy plans don't have any money in them is because when the market started soaring, the companies didn't make any contributions and when the market tanked the continued not making contributions saying they couldn't afford it.
All the while SWA dutifully paid every dollar of its commitments every month, and the combined contributions as a percentage of employee income almost always exceeded even the most generous legacy pension program of the good old days.

Completely wrong. There is such a thing as a funding limitation, thus under the law you can't over contribute.....

As for the rest of your post, I don't believe it either.


Strengthening Pension Funding

In addition to the special funding rule for certain airline plans and the replacement of the 30-year Treasury bond rate, ALPA believes that the funding rules for defined benefit plans should be strengthened by permitting employers to make larger contributions to plans when they are able to afford them. One way to achieve this result is to allow employers to take into account expected cost-of-living increases in the limitations under Code Sections 415 and 401(a)(17) when calculating the plan's funding obligation. The current funding rules do not permit the plan actuary to anticipate such increases.

Additionally, the current full funding limitation should be replaced with one that permits employers to contribute more to defined benefit plans. Under current law, contributions cannot be made to a plan if the assets exceed the plan's accrued liability (including normal cost). Employers should be permitted to make deductible contributions to a plan until the plan's assets equal the greater of the present value of all future benefits or 130% of the current liability.

 

[WatchYourElbows]

The PBGC is nothing more than an insurance company. If they couldn't afford to pay on default, then they shouldn't be in the business. This doesn't (shouldn't) fall to the tax payer, it should fall directly onto the PBGC. THAT is why the companies have been paying premiums for years and years and years and years.......


Ever wonder how much $$$$ United has paid the PBGC?

 

[Widow's Son]

>>Completely wrong. There is such a thing as a funding limitation, thus under the law you can't over contribute.....

As for the rest of your post, I don't believe it either.<<

You obviously don't understand how SWA's 401k and profit sharing program works. When total contributions exceed funding limitations the excess can either be paid in cash or captured in an additional deferred compensation plan.

My point was simply while the legacies stopped making contributions both in good and bad times, SWA made its matches month in and month out, so the plan wasn't "cheaper" as the original poster implied.