So it sounds like you're saying things have just been getting progressively worse. That doesn't sound like much of a different perspective. There was a time when people were optimistic about the future, but granted that was a long time ago.

This is why defined benefit pension plans are so risky for retirees, employers, and taxpayers. We need to completely eliminate them and use defined contribution plans such as 401(k) instead. That way retirees actually own the assets in individual named accounts and those can't be taken away if the employer is sold or goes bankrupt.

Pensions do have risk, but you act as if 401(k) style plans don’t. Imagine how difficult it would be to plan fastidiously for your retirement and then have the stock market collapse and wipe out 1/4 or 1/2 of your savings. Yes, you should diversify your investments to reduce your exposure, but in this instance the risk and responsibility is on you the individual. Isn’t it strange how two different systems that on paper have totally different risk profiles both have a huge risk of low and middle net worth individuals getting wiped out?

In practice there is no risk of defined contribution plans getting wiped out unless the account holder does something exceptionally stupid. Most plans default to using target date mutual funds which automatically rebalance to reduce stock exposure every year. If there's a major stock market crash then older employees will have very little exposure and younger employees have plenty of time to financially recover.

Exactly, target date funds and broad market index funds with 0.03% fees have automated away the entire job of the pension fund. And the Feds will bail out the public markets, so retirement funds invested in the market are effectively insured by the best insurer possible at all times.

Why did he think the paychecks would stop coming?

My grandfather worked for the steel mills. Some workers didn't get anything for their pensions. He was one of the lucky ones and got something, like 10 cents on the dollar. I think they even stopped sending them before he died (remember him saying something about that was the last check and complaining about the company).

Pensions are insured but not at 100% of what was promised by the employer’s pension plan. Thus, getting only 10 cents on the dollar is certainly possible. https://en.wikipedia.org/wiki/Pension_Benefit_Guaranty_Corpo...

And this is why forcing USPS in 2006 to prepay pensions for the next 70 years is a good thing, as opposed to a "GOP conspiracy to privatize the post office". Why it was passed almost unanimously by Congress.

USPS's primary business, delivering letters, was by 2006 clearly in terminal decline, with no guarantee that parcel volume would increase to compensate. Many, many employees of newspapers—the other industry that in 2006 was facing similar danger—wish that Congress had mandated something like this for their pensions.

1) Except that NO OTHER COMPANY needs to prepay pensions for 70 years. I have no problem with the fact that companies must prepay pensions. Then make it the law for everybody--not just the USPS.

2) The USPS is supposed to be unprofitable--it's supposed to service everyone. If you are going to hound the USPS about profitability, then they should be allowed to drop service in rural areas. The easiest way to decrease pension obligations is to permananetly drop a whole bunch of workers from unprofitable areas, no?

The problem is that the arguments around the USPS aren't made in good faith. The goal is to bankrupt the USPS so that they have to sell off the extremely valuable real estate that many USPS facilities sit on.

>1) Except that NO OTHER COMPANY needs to prepay pensions for 70 years.

I wrote that the newspaper industry was the other that by 2006 was clearly in decline for the same reason as USPS letter delivery: The Internet. Most industries aren't like this.

>2) The USPS is supposed to be unprofitable--it's supposed to service everyone.

I said nothing about profitability. The Constitution also says nothing about profitability or anything else about USPS, other than that Congress has the authority to establish post offices. That's it.

That said, Congress has historically required USPS to self-fund as much of its operations as is practical. Were this not the case, postage rates would never have risen in history, before or after the 1971 reorganization of the cabinet-level agency to the quasi-independent entity that it is today. Nor would it have consistently issued new stamp editions to sell to the public.

More to the point, making sure future USPS pensions are funded has nothing to do with profitability, at least directly. It's simply good sense given the ongoing and, in all likelihood, irreversible decline toward zero non-parcel volume. Even if the USPS were mandated by law to always run at a slight loss to maximize customers' savings on postage, pension prefunding would still be prudent.

>The problem is that the arguments around the USPS aren't made in good faith. The goal is to bankrupt the USPS so that they have to sell off the extremely valuable real estate that many USPS facilities sit on.

First, there is no major political movement in the US to "bankrupt the USPS", presumably in advance of a sale. No political party has such in its platform. (If you reply that the very absence of such is proof that the plan exists, I'll just throw up my hands and give up now.)

Second, there's nothing in the Constitution that would prohibit USPS from being privatized, which has happened in most European countries, usually with little controversy.

They could, and probably should, increase letter and advertising prices.

Pensions are all insured in the US

It got complicated when the steel mills went bankrupt and the pensions were taken over by federal agencies. The bankrupt company, in this case, was paying more for pensioners than what the federal agencies paid.

I'm not entirely clear on why this was, but it may have been that they were not fully insured or that promises made by the steel mills were not backed by anything. In these cases, some pensioners actually had to give money back [1].

This happened to my grandfather, who worked in the steel mills in western Pennsylvania. If you ever wanted to see him red-faced mad, this was the topic to discuss.

1. https://www.mcall.com/news/all-retirees1118-story.html

PBGC, government body that back stops is mentioned.

Yes, the backstop isn’t 100% and has a cap, but the pension is will never go “broke”.

I believe the coverage is something like 60% up to $64k/yr.

That doesn't mean you will get what you were promised if the pension was underfunded[1]:

> If you look at multiemployer plans, those people worked in coal mines, driving trucks, in bakeries — typically physical, difficult jobs, and they certainly earned the pension they were promised by their union. Now, some of them are 70-years-old and in retirement and have the terrible prospect of having their pension cut.

> There’s a government backstop for private pensions, but the government backstop for multiemployer plans is very modest

[1]: https://ideas.darden.virginia.edu/underfunded-pensions

Do you have a source? I wonder if that covers all pensions or just public pensions? Or if that requirement is newer and didn't exist when the companies went under 50 or so years ago.

Even taxpayer funded DB pension recipients have had to accept benefit cuts, such as former employees of Detroit and Rhode Island.

If the entity that owes you does not have the power to print money, then there is always a risk of non payment. And how much of a bailout you get depends on your political weight.

PBGC is “insurance” for pension plans.

Looks like their site says there was little protection for pensions before 1974. So it sounds like there wasn't any protection before that. Their wording around "insured pensions" also seems to indicate that some pensions may not be insured (no requirement to insure them).

A large number of folks think the world already ended, and we're just waiting on the collapse. That now both on the right and left.

I used to work in film, and every once in a while I get a script to read, passed around because it is "too good to be made". One such script I read about 2 years ago had the premise of an archeological discovery, rapidly verified and with duplicates found all over the world proving "the rapture" happened back in the year 1000 AD. The modern world realizes we're in the 2nd century of the 10,000 year reign of Satan. All hell breaks loose, of course.

You probably meant 2nd millennium (VS century). Is this script available on the Black List?

I don't believe it is available anywhere, because it is entangled legally, as apparently the author of another literary work with the premise of finding lost bible books documenting a continued life of Jesus with a family and kids sued the author of this script. I've not followed the situation, simply because I don't care about such things.

That's a great premise, and I say this with years of being pentecostal.

Not all pensions are well managed; some have needed bailing out from public coffers. Other companies have shuttered completely, and the lack of incoming money to the pension funds made them insolvent (again, not especially well managed).

Its doesn't have to be public bailouts. There is something for Americans where the pension funds have been seized by the federal government to be managed. I worked for a company where the executives were using pension funds to give themselves annual bonuses until the federal government stepped in around 2009. There wasn't much money left over, so I'll be receiving very little, but at least the executives could raid the funds anymore.

> Welcome to PBGC! Since 1974, we’ve protected retirement security and the retirement incomes of over 33 million American workers, retirees, and their families in private sector defined benefit pension plans.

https://www.pbgc.gov/

It's a shame that you got screwed out of what you'd been promised. I'm guessing yours wasn't in the $86 billion bailout (maybe because it only went to multi-employer union plans?)

> https://www.cnbc.com/2021/03/08/covid-relief-bill-gives-86-b...

Unfortunately, it's not just the private sector pensions that have been mismanaged (or raided, as you pointed out) which are in dire straits. California, in particular, has a lot of public pension headaches that will be coming to a head (and in some cases already have):

https://www.latimes.com/projects/la-me-pension-crisis-davis-...

https://www.forbes.com/sites/adamandrzejewski/2020/05/19/why...

No, this was a telecom company where the Canadian executives were siphoning money from the American work force, which was net profitable. The Canadian side was losing money by the billions. The pensions were down to a mid sixty percent reduction before the American government stepped in to stop the transfers. It was in all the papers.

Even well managed funds can result in someone getting the shaft. My dad's pension (Delphi Salaried) was cut to 50% of what it was supposed to be after the events of '08, and it was funded to something like $0.86 on the dollar, above the national average.

The hourly workers (i.e., unionized) still got 100%, which was pretty unfair.

In the last few years, there's been some nostalgia in the US over pensions, but people tend to forget that they're tied to employers, so people feel tied to jobs because they're building up a pension, and the pension is often managed by and dependent on the employer's business in some way.