Another $40 billion shortfall

If "bailout" was the term of the year in 2008, look for "underfunded pension" to be the phrase in 2009.

The automaker pensions are underfunded by roughly $40 billion. Completely shocking. But don't worry, they are guaranteed by the Pension Benefit Guarantee Corp. And take a guess who is ultimately responsible for the PBGC? You guessed it, folks. Uncle Sam.

http://online.wSportsJournalists.com/article/SB123153297521269035.html

Agency Raises Concerns About Car Makers' Pensions

The head of the U.S. Pension Benefit Guaranty Corp. acknowledged in an interview that General Motors Corp., Ford Motor Co., and Chrysler LLC have well funded pensions according to the standard accounting rules applied by the Securities and Exchange Commission.

But by the PBGC's measures, the pension funds of Detroit's Big Three would be underfunded by as much as $41 billion ...

[PBGC Director Charles E. F. Millard] estimates that the three auto makers only have enough money in their pension funds to cover only 76% of the pension obligations they have made, if they terminate the pension plans. GM's plan is estimated to be $20 billion, or about 20% underfunded, while Chrysler's plan is 34% underfunded, leading to a $9 billion-plus shortfall, the agency said. Ford's funded ratio is not publicly available, but the company's pension plans are likely running at a $12 billion deficit.

About $13 billion of the estimated $41 billion shortfall would be covered by the PBGC ...

Just throw a TARP over everything.

 

I was off by a year.

By 2015, 1/3 of the city of LA's general fund will go to pensions. Awesome.

http://www.latimes.com/news/local/la-me-la-city-pensions-20100804,0,5060130.story

 

We all knew this pension bomb was coming for years. Heck, I remember hearing warnings about it when I was in high school, when some Boomers were still in their 20s.

Big barrier to fixing the problem: Old people vote.

 

I'll become outraged about the common working man receiving his pension after big companies stop giving golden parachutes to the execs running them into the ground.

 

That article ignores a significant precedent. When PBGC took over United's pension program, many retirees saw their benefits slashed by 50 to 75 percent. Sucks ass for them and is horribly unfair, but the toll on the American taxpayer turned out to be far less than the Chicken Little forecasts back then.

I just don't know why the Wall Street Journal would try to exaggerate this new problem facing Obama. It's a mystery.

 

http://www.marketwatch.com/story/could-the-government-create-a-backdoor-stimulus-2010-08-04


Morgan Stanley looking out for middle America.

 

I thought Ford was making good and paying off the obligation to the pensions bit by bit. Wasn't there a 3.4 million dollar payment last quarter?

 

You are obviously not nearly terriified enough of the magnitude of the Socilist Mooslim Neegro Menace. Here, let me terrify you some more.



LOUD NOISES!! FLASHING SIRENS!! BIG TITS!! BIG, BIG TITS!!!

 

Thank you. And God forbid that middle-class working people who negotiated contracts expect that those contracts be honored.

 

Oh man, I know some people, actually lots of people, who just flip the fuck out over unions.
In a bad way, act like unions are the right hand of Satan or something.
I've never understood it.
The same people who bitch about the "Detroit auto workers" or "teachers' unions" are the same people who complain about how poorly they are treated by their employer and always moan about life could be better.

 

I've said for years that the people who hate unions are the ones who wished they belonged to one. If you listen to their arguments its total resentment. "These damn teachers, man...gettin' like, you know, 4 percent and 5 percent raises 'n shit. I dont get those kinda' raises." Yup, you don't. And I'll bet you wouldn't bitch if you did.