May 16, 2005
Free Market Miracle #0021
AKA: "The State giveth, and the State taketh away."
THE PRESIDENT: Thank you all. Please be seated. Welcome. Thank you very much for coming today. Today we take an important action to strengthen -- to continue strengthening our nation's economy. The bipartisan bill I'm about to sign makes common-sense reforms to our bankruptcy laws. By restoring integrity to the bankruptcy process, this law will make our financial system stronger and better.
Bankruptcy reform has been a top priority of banks, credit-card companies, and retailers for the past decade. The credit card industry has given $25 million to federal candidates and the political parties since 1999 and commercial banks have given $76.2 million, according to the Center for Responsive Politics, a Washington, D.C.-based watchdog group.
A federal bankruptcy judge approved United Airlines' plan to terminate its employees' pension plans yesterday, clearing the way for the largest corporate-pension default in American history.
The ruling, which carries broad implications for U.S. airlines and their workers, shifts responsibility for United's four defined-benefit plans to the government's pension agency.
That will save cash-strapped United an estimated $645 million a year, part of the $2 billion in annual savings it says it needs to line up enough financing to emerge from Chapter 11 bankruptcy as soon as this fall.
But the cost will be painful to its employees, who stand to lose thousands of dollars annually off their pensions when they are assumed by the Pension Benefit Guaranty Corp.
Posted by Eddie Tews at May 16, 2005 06:26 PM
Comments