If the retirees did put their own money in, don't they have a right to remove their own money from the fund and control it? That's the way a company 401K works.
No. These pensions are "defined benefit". In a defined benefit plan you earn the benefit based on length of service, and perhaps job classification or pay grade. Let say you work for Big Airline Inc. Big Airline, as part of their benefits when you join at 25 says: Ms. Stewardess for each year you work Big Airline will give you a pension of $200 a month when you retire. So you work 30 years, and you have a defined benefit of 30x$200 / month, which works out to $6,000 a month or $72,000 a year.
Supposedly the company was supposed to be building a fund to pay this off. But in the real world perhaps they misinvested it in Enron in the 1990s (the idea being to show more profit for the company by putting less money into the pension fund and using super aggressive investments to meet the funding requirements). Or perhaps their actuarial assessments were wrong, expecting most retirees to die by 69 and they are now living to 72. Or perhaps there business just went to crap and they had no way to put any money into the system for 4 years. Net / net is you have no individual account, only a promise.
What companies like Delphi are doing is going to chapter 11 and saying: we can't stay in business and pay all these benefits. So the pensions are sent to the Pension Guarantee Board, along with some cash, maybe some stock in the company, maybe some future profit sharing plan. Oh, yeah, the benificiaries have their benefits reduced in this process. So Ms. Stewardess will be told something like: the maximum the PGBC pays is $4,000 a month, not $6,000. That is your new pension.
There is an expectation that taxpayers will now bailout the PGBC. This is just another bogus intergenerational transfer of wealth. While one feels for those who are not getting their promised pensions, it certainly is odd to say that todays workers, who are on the job and not being promised (in general) ANY guaranteed benefit (and are already paying more to oldsters for Social Security than they will ever recieve from THAT system) have to keep the promises that they were not involved in making. On the other hand seniors vote, and most have shown no disinclination to vote like liberals, that is take money they have not earned from whoever they can take it from.
I don't mean to sound harsh, but the purpose of social security is to prevent folks from being pushed out into the streets. I'm not crazy about SS, but at least I can agree that no one too old to work should be out on the street. But I don't see any reason why the government owes seniors a middle class or better existence.