June-July 2005

You Have a Safer Pension

United Airlines last month joined Enron, WorldCom, and Arthur Anderson in the corporate hall of shame. After years of forcing its employees into give-backs on wages and benefits, United has finally used the bankruptcy process to stop making payments to its retirees and shirk its obligations to existing employees. A federal agency, the Pension Benefit Guarantee Corporation, will underwrite these workers' pensions at taxpayer expense. But it will only provide a fraction of what the retirees are presently getting, and a fraction of what the workers who are currently working, expected to get when they retire.

What United did and what the court approved is inexcusable! And it's scary, too.

I am writing to assure you that your pension, whether it is the Western Conference of Teamsters (WCT) Pension Plan or the Automotive Industry (AI) Pension Plan, is safe -- even if your company declares bankruptcy, or any other company participating in the plan goes belly-up.

If you are covered by either the WCT or AI Pension Trust Funds, you are participating in a very different form of pension plan from the United plan. While all three plans are "defined benefit plans," your is a "Multi-employer plan." The United plan is a "Single-employer plan."

A Single-employer plan is dependent on the contributions from a single employer. If the company that supports the plan goes out of business or files for bankruptcy, the plan is in jeopardy.

Our Multi-employer plans receive contributions from hundreds, and in the case of the WCT Plan, thousands, of employers. These funds are co-mingled so that if one single company goes out of business, the other employers take up the slack.

As many of you know, many companies, especially in the freight industry, have gone out of business, but the pensions of the Teamster members who worked at these companies have not been affected. This is the benefit of a multi-employer plan. It affords much more protection than any other type of pension vehicle.

There's a larger point to this. The attack on retirement security -- whether it's United dumping its pensioners, George Bush seeking to privatize Social Security, or Arnold Schwarzenegger going after the pensions of cops, teachers and firemen -- are all pieces of the same puzzle. These guys want pensions, Social Security and Medicare to go away. They want to roll back the safety net that lawmakers in both parties agreed long ago would provide a minimum level of support during times of disability and retirement. It's happening all over the country.

Your pension plan was built to last, whether you've worked at a Local 853 shop for 10 months or 25 years. But think beyond your own retirement. Think about your kids, and their kids. If Bush, Schwarzenegger and their kind are allowed to continue their attacks on our fundamental rights, and our basic benefits, eventually no one will be safe.

That's why it's so important for all of us to do the little things -- register to vote, vote intelligently, and support those political leaders who will support our rights to good jobs with decent wages, benefits and retirement security. In the near future, I will ask you to send letters to your Representatives and Senators to support federal legislation that will help strengthen our multi-employer plans.

And as we remind you elsewhere in this newsletter, your voice is that much louder and stronger if you join with millions of other Teamsters by contributing to DRIVE, the political action fund that supports politicians who support you. Because when it gets down to it, it's all about who's got power and who's got the political strength to protect your interests.

Fraternally,
Rome A. Aloise, Secretary-Treasurer

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