Get FREE NRO Newsletters

 

June 11 Issue  |  Subscribe  |  Renew

Close

New on NRO . . .

Planet Gore

The hot blog.


Print   |  Text
 

UAW Bailout: White House Kneecapped White-collar Pensioners

Constructing their UAW bailout a year ago, the White House Auto Task Force ran roughshod — Chicago-style — over secured bondholders’ rights in order to secure a deal for Big Labor. Less well known is that secretaries, engineers, designers, and other salaried men and women were getting kneecapped, as well.

The gutting of white-collar worker pensions at Delphi, GM’s biggest parts supplier, is a teachable moment about UAW power and Obama administration callousness.

As the administration rushed to complete GM’s bankruptcy last May, the question of Delphi was a pressing issue. Spun off by GM in 1999, Delphi was still intimately bound to its former parent through supply chains and union contracts. But when it came time to resolve Delphi pensioners, Delphi’s salaried workers were thrown overboard even as the UAW’s pensions were made whole.

That’s what over $7 million in campaign contributions to Democrats buys you.

When Chrysler bondholders balked at the UAW bailout paying a paltry 29 cents on the dollar, “one of my clients was directly threatened by the White House and in essence compelled to withdraw its opposition to the deal under threat that the full force of the White House press corps would destroy its reputation if it continued to fight,” lawyer Tom Lauria said last May. Take da deal or else.

In the case of Delphi, the administration simply broke salaried pensioners’ legs and left them by the side of the road.

While all Delphi pensions were transferred to the Federal Pension Benefit Guarantee Corp. (PBGC) and slashed by 25-60 percent, UAW contracts were “topped off” by the administration. Though the money technically came from GM, it was ultimately government financed. As a result, some 20,000 salaried workers saw their nest eggs crack while blue-collars were made whole by U.S. taxpayers.

“It was a decision to be discriminatory. It was a commercial decision to pacify the UAW,” says Den Black, a retired engineer and president of Delphi Salaried Retirees Association. The association says workers were denied due process and are taking the case to court this month.

Salaried workers knew none of this at the time, as the White House carved up people’s lives behind closed doors. Indeed, a former Delphi worker, Ken Hollis, says it would have been better if Delphi had gone bankrupt since “the PBGC has placed liens on Delphi’s European assets.” But salaried workers had no idea. The only seats at the table were for Big Labor.

One of those seats belonged to the International Union of Electrical Workers (IUE) who were initially cut out of the deal. But like the UAW, they played their political ace, threatening political consequences in the key swing state of Ohio — a IUE stronghold — unless they too were made whole.

But no one came to the salaries workers’ aid. Why? Simple Democratic politics. For all its talk of being the Party of the Working Man, in fact Democrats are the Party of Special Interests Who Grease Our Palms.

Delphi’s white collars — not the fat cats of media caricature but middle-class engineers and service workers — simply did not give enough money to the party to matter.

Incredibly, they received no political attention at all even as 7,000 Delphi white-collars live in swing state Michigan, for example. Michigan Senators Levin and Stabenow apparently were powerless to provide the most basic constituent service — making sure pensioners were treated fairly. Perhaps these senators were too busy passing out Green stimulus pork to well-heeled battery firms to worry about lifetime Delphi workers losing their retirement greenbacks.

Today, those political representatives are Johnnies-come-lately to the table, trying to make amends for Delphi’s hurting workers, many of whom have seen their retirement plans go up in smoke. Some have even committed suicide. But now they have bipartisan support in Congress. They have damning charts. And they have a day in court. On September 24, they will have a federal hearing in Detroit.

The Office of the Federal Special Inspector General, Neil M. Barofsky, has also agreed to conduct an audit of the administration’s ruthless and unfair tactics and “whether political considerations played a role in favoring hourly over salaried retirees.”

The politics should be clear enough: Big Labor owns this administration. And no one else matters.

New on Planet Gore. . .


COMMENTS   4

EXPAND  

   09/17/10 14:54

As El Jefe likes to say, sometimes you've made enough money. This must have been one of those times.

Reply to this commentLinkReport Abuse
K. Raskasky
   11/22/10 12:29

I would not drive a GM car if someone gave it to me. Even when I rent, I refuse a GM car. This administration owns GM, and I do not support socialism.

K.R.

Reply to this commentLinkReport Abuse
win
   12/10/10 15:34

This administration penalizes the educated work force is what it gets down to. The tax cut extension for those over 250,000 was mostly for professional, college educated, families. They don't get handouts, they pay for their children's college education, they don't get food stamps, or housing help. They pay full price and pay most of the taxes in this country.

Same thing here, white collar workers are mostly college educated, they get no protection, instead heavy penalties under these policies.

Now is it any wonder that those with low skills and low education prefer to immigrate to the US while those with higher education and skill levels prefer Canada as several world wide polls have shown. Not at all. Yet, the Democrats keep up all these policies which are extremely destructive to this country.

Reply to this commentLinkReport Abuse
   03/02/12 10:56

Government intervention in the GM/Delphi bankruptcies allows over 500,000 retirees to receive 100% of their pensions, while slashing those of 22,000 Delphi retirees by 30-70%! If this travesty is not fixed, then it can happen to YOU! President Obama must restore the FULL earned pensions of the Delphi retirees!

Join the fight to correct this injustice by visiting www.facebook.com/DelphiRetirees and www.twitter.com/DelphiRetirees Share these pages with your friends also!

Let's send a message to Washington and make Obama live up to his words that "if you work hard and play by the rules then you've earned your pension".

Reply to this commentLinkReport Abuse

Add a Comment

Already Registered? Log In Here.


The content of this field is kept private and will not be shown publicly.


* Designates a required field.
© National Review Online 2012
All Rights Reserved.
Subscriptions
NR / Print
NR / Digital

Gift Subscriptions
NR / Print
NR / Digital
NR Apps
iPhone/iPad
Android

NRO Apps
iPhone
Support Us
Donate
Media Kit
Contact