Posted on 09/22/2010 7:09:51 AM PDT by St. Louis Conservative
The special inspector for taxpayer bailout funds is looking into whether the Obama administration pressed General Motors in bankruptcy to backstop the pensions of the union retirees of a former division, Delphi.
The inquiry could clarify a lingering mystery of G.M.’s forced restructuring last year: both unionized and white-collar workers earned pensions while at Delphi, a G.M. spinoff also in bankruptcy, but when the federal government took over their failing pension plans, only Delphi’s white-collar retirees suffered painful benefit cuts.
Neil M. Barofsky, the special inspector general for the Treasury Department’s bailout programs, said he intended to find out “whether political considerations played a role in favoring hourly over salaried retirees.”
As special inspector general for the Troubled Asset Relief Program, Mr. Barofsky has extensive power to investigate, but no real power to act on his findings. If his audit turns up evidence of impropriety, it will be up to another federal agency to step in.
The federal government insures traditional pensions, but its insurance has limits, including, for example, a yearly maximum benefit of $54,000 for a person who is 65 years old when the plan fails. Workers whose companies promised them richer benefits can therefore suffer sharp reductions. Normally, no amount of complaining, lobbying or litigation can make the Pension Benefit Guaranty Corporation bend the rules.
When Delphi’s pension plans were terminated last year, many of its 21,000 white-color retirees were warned that their pensions might be cut by 30 to 70 percent. The amounts vary because the insurance rules involve factors like each retiree’s age and years of service, the design of the pension plan and even how much money was in the pension fund when it failed. It can take more than a year for the government to calculate the precise amounts.
(Excerpt) Read more at nytimes.com ...
Totally consistent with the Dimocrat world view though.
If you didn’t want to get screwed, you should have joined a union!
The list, ping
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"Democracy is the road to socialism.""Workers of the world unite; you have nothing to lose but your chains." Karl Marx
-- Karl Marx
It’s a good thing we have a constitutional republic, and not a democracy.
Not according to the people in question here we don’t.
Which is of course why we’re sliding into socialism.
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