Surprise, surprise. Delta Airlines, which is in the middle of a bankruptcy restructuring, announced plans this afternoon
to dump their pilot's pension plan. But, before you shed any major tears for the pilots, or switch your flight plans because one of the pilots might go berserk over this action, don't worry - Delta pilots didn't even object. Why?
They're still going to get their pensions. From the American taxpayer.
"What????", you say, as you set down your beer and turn away from the bbq grill...
Yes, it's happened again, and I'm feeling almost psychic today. When United Airlines did the same thing a year ago,
I predicted:
The tip of the iceberg is that the court (and the federal goverment, by way of PGB acquiesence in the proceedings), sets precedent and opens the gates of pension fund hell if it allows United to walk away from this debt in order to regain solvency. You think there are problems with Social Security? Baby, you ain't seen nothin' yet. If this deal flys, every large company with an underfunded pension plan burden will be trying the same thing. And rest assured they will.
I acknowledge that this topic is so friggin' unsexy that there's no way to shock the average 'murican into wakefulness to understand the future ramifications of these type of bailouts. And there is no end in sight - particularly when you consider
UAW President Ron Gettelfinger's remarks last week at the UAW's annual meeting in Las Vegas. You think $50 or $100 billion in airline pension benefits being shouldered by the U.S. taxpayer is a lot of coin? Wait until the first U.S. automaker files for bankruptcy and tries to dump its pension plans.
The pensions issue hasn't begun to play out, and will dwarf any problems with Social Security by the time it's resolved.