AMFA......read on

[FWAAA]

 What the hell do I care about what AA is contributing compared to it's competitors? Make sure my Pension is 100% funded and they can move on and skip merrily down the road from it.
 
Because that money isn't increasing your pension benefit one dime, that's why.  Had AA been allowed to terminate the pensions, that $720 million would have been available in 2014 for other expenses (employee wages, perhaps?).   Of course with the worthless union representing you, I realize that it's an insane assumption that your union would have been successful in negotiating any portion of that $720 million for pay raises.   The TWU's long record of failure makes my assumption unreasonable.   
 
When your employer has an expense that your competitors don't have (or their expense in that category is much smaller than your employer's expense), someone has to make up that difference, and in the airline industry, that someone is always the employees.  
 
It boggles my mind that you don't understand that.  
 
Sounds to me like you would have been ecstatic if AA had been allowed to throw my pension on an already stressed and way underfunded insurer. 

If your employer is going to file for bankruptcy reorganization,  might as well reap the same benefits that the other airlines obtained, and that was terminating their underfunded pilot pensions.   Instead, you guys got the downsides of bankruptcy without the benefit.   

Nothing is frozen if it isn't fully funded to have all the money necessary to cover the payouts. What is the magical Pension fairy just going to put my retirement money under my pillow?  
 
Are the employees of UA and DL (and premerger US) concerned that the PBGC won't pay their pensions?    When you're laid off, do you file for unemployment comp or do you refrain because you don't want to be a burden on everyone else?   
 
You keep harping on the political aspects of the remote possibility that the PBGC runs out of money.   And so you're happy about paying to fund the AA pensions with your lower wages.
  
That 720 million is money that should have been in there in the first place. The old AA WAS NOT keeping up to it's obligation to give me what was negotiated. And the laws are what gave them the ability to do so.   
 
Wrong again, but more to the point - how they came to be underfunded is irrelevant.   But since you brought it up, the AA pensions were 96% funded at the end of 2007, before the event that caused their funding percentage to fall - the stock market decline in 2008 that accompanied the Great Recession.    It's a popular soundbite to claim that former management wasn't funding them properly - but absent the stock market crash of 2008, the pensions were fully funded.   I get the desire to hate management at all times - but in this one case, AA management did their job properly and had funded the pensions.   

 

[FWAAA]

FWAAA
 
Thats the way it was explained to me when I asked for the paperwork from the PBGC.
 
They also explained that I was also subject to the rules of early withdrawal due to age as well. Which is 6% a yr before 62 with Eastern. Since I will rcv almost $400.00 a month for 10yrs of EAL service from the pbgc if I wait a couple of yrs I decided not to send in the papers to draw it now. No one can explain or knows what we were supposed to get if EAL did not go into BK. I don't know anyone with that documentation.
 
But if I was old enough I could draw it now even though I am still working. There are guys here in Miami that are EX - EAL and drawing it.

Whoever explained it to you was mistaken.   Think of it this way:  if your pension plan was only 5% funded (95% underfunded), would the PBGC give you just 5% of your pension?   That would make a mockery of the word "Guaranty" in their  name.    The PBGC exists to guarantee that employees will get their earned pensions (earned as of termination, not their expectation had everything worked out to normal retirement age) no matter the funding level, subject to the monthly maximum payout.

 

[AMFAinMIAMI]

Whoever explained it to you was mistaken.   Think of it this way:  if your pension plan was only 5% funded (95% underfunded), would the PBGC give you just 5% of your pension?   That would make a mockery of the word "Guaranty" in their  name.    The PBGC exists to guarantee that employees will get their earned pensions (earned as of termination, not their expectation had everything worked out to normal retirement age) no matter the funding level, subject to the monthly maximum payout.

FWAAA
 
OK using your analogy if they took on every under funded pension and paid the full amount you lived for 40 yrs they would run out of money before you died.
 
Where does the money come from, thats why the IBT and IAM reduced the pay out to PBGC levels since these plans are running out of money and the retired won't get life time payments.
 
But like I said this thread is for the Mechanics and What needs to be shared as far as info and for questions to be asked about How we get it done? As well as maybe complain about the TWU/IAM assoc. and how they will not represent us the way we think we will get from AMFA.
 
The IAM pension and PBGC are for another place. True? That can be discussed there.
 
The AA pension is frozen and I hope it stays there and I get what is coming to me when I retire. I don't want anything to do with any fund that tells me what to do after I retire. It's my money Not the IAM/TWU's.
 
I don't want any Union to dictate my retirement, That includes AMFA...

 

[Glenn Quagmire]

Just because a pension is underfunded does not mean that it is close to being taken over by the PBGC.

I am with FWAAA here. You and weAAsles' understanding of the pension process is shocking given that you both seem to be union rep's or want to be one.

 

[WeAAsles]

 

 What the hell do I care about what AA is contributing compared to it's competitors? Make sure my Pension is 100% funded and they can move on and skip merrily down the road from it.
 
Because that money isn't increasing your pension benefit one dime, that's why.  Had AA been allowed to terminate the pensions, that $720 million would have been available in 2014 for other expenses (employee wages, perhaps?).   Of course with the worthless union representing you, I realize that it's an insane assumption that your union would have been successful in negotiating any portion of that $720 million for pay raises.   The TWU's long record of failure makes my assumption unreasonable.   
 
When your employer has an expense that your competitors don't have (or their expense in that category is much smaller than your employer's expense), someone has to make up that difference, and in the airline industry, that someone is always the employees.  
 
It boggles my mind that you don't understand that.


I do understand it and what I also understand is that with 10 Billion in the bank it seems to me that the NEW AA is making up for past sins by trying to expedite that shortfall. They are only required to make up 150Mil of the shortfall this year but instead are adding another 600 Million to the kiddy. 

It boggles my mind that you don't understand responsibilities.
 
 
Sounds to me like you would have been ecstatic if AA had been allowed to throw my pension on an already stressed and way underfunded insurer. 

If your employer is going to file for bankruptcy reorganization,  might as well reap the same benefits that the other airlines obtained, and that was terminating their underfunded pilot pensions.   Instead, you guys got the downsides of bankruptcy without the benefit.


Yea I like the way you think. Just because the other guy was able to make off with the old lady's money why shouldn't I go in and rob her as well. Obviously you're not a Pilot or someone who would have been affected negatively if those pensions had been thrown on the PBGC.

  

Nothing is frozen if it isn't fully funded to have all the money necessary to cover the payouts. What is the magical Pension fairy just going to put my retirement money under my pillow?  
 
Are the employees of UA and DL (and premerger US) concerned that the PBGC won't pay their pensions?    When you're laid off, do you file for unemployment comp or do you refrain because you don't want to be a burden on everyone else?

My employer is forced by law to pay into that insurance plan so yes I will use it. But unlike some people NO I don't want to be on it forever and want to have a job and EARN my pay. 
 
You keep harping on the political aspects of the remote possibility that the PBGC runs out of money.   And so you're happy about paying to fund the AA pensions with your lower wages.

It's my money either way you cut it. Yes the company was put in a jam like everyone else was in the collapse of 2008. The real criminals are never going to pay for what they did and will never see a day in a jail cell. Why? Because they OWN YOU!
 
  
That 720 million is money that should have been in there in the first place. The old AA WAS NOT keeping up to it's obligation to give me what was negotiated. And the laws are what gave them the ability to do so.   
 
Wrong again, but more to the point - how they came to be underfunded is irrelevant.   But since you brought it up, the AA pensions were 96% funded at the end of 2007, before the event that caused their funding percentage to fall - the stock market decline in 2008 that accompanied the Great Recession.    It's a popular soundbite to claim that former management wasn't funding them properly - but absent the stock market crash of 2008, the pensions were fully funded.   I get the desire to hate management at all times - but in this one case, AA management did their job properly and had funded the pensions.

It's NOT irrelevant and unlike many no I don't blame the company. Yes they did the best they could IMO to do the right thing and that should be pointed out. But just because they can now get away with something with the tool of a bankruptcy gun doesn't mean they should or should be allowed to. It's the law that allows the theft and the law is wrong. Unless you're one of the thieves who wrote it I guess. 

 

I doubt that you'll understand or agree with anything I just wrote because I'm sure when it comes to our particular worldview, you're sitting on the other side of the fence from where I'm sitting.

 

[WeAAsles]

Just because a pension is underfunded does not mean that it is close to being taken over by the PBGC.

Of course not and I never said it was. Looking at where they are now it doesn't seem like Delta, United and USairways pension still needs to be in the hands of the PBGC either. But there is where it will sit.

I am with FWAAA here. You and weAAsles' understanding of the pension process is shocking given that you both seem to be union rep's or want to be one.

Pensions just as much as 401K's are tied into the market and the stocks played. What more needs to be understood? Risky investments are what can cause the demise of anyone's retirement income. But if you have the means to make up for your risky investments you should have no choice but to do so. Individual or Corporation alike.

 

[Show me the money]

Guys! why do you keep answering 700, if I see his post I ignor him, in this discussiion he is irrelevant. This is for AMT's who want to talk about AMFA and the pro's and con's about what they might want going forward. 700 is a stores clerk and if we get AMFA his meal ticket is going away.  I am in agreement AA needs to finish funding our current frozen pension, and we also need to keep the IAM from touching one red cent that they have already propsed doing. AMFA wants nothing to do with running a pension. We need to have the company up their 401K contribution to us from 5% to 10% or better. We also need the return our our profit sharing.

 

[FWAAA]

I doubt that you'll understand or agree with anything I just wrote because I'm sure when it comes to our particular worldview, you're sitting on the other side of the fence from where I'm sitting.

Nonsense.   On a personal belief level, I agree with much of what you wrote.   Like Arpey, I saw airline bankruptcies and the casting off of promises and pension obligations as morally reprehensible.   
 
Years before you posted here, I posted here and elsewhere that in my view,  United and US Airways should have been shut down and liquidated to pay their pension promises (to the pilots, of course, since they were the ones who saw cuts to their accrued benefits).   
 
I was roundly criticized by many for such an unpopular view.   Here and elsewhere, people asked "how could I wish for tens of thousands of good people to lose their jobs?"   Well, it's an area where Bob Owens and I agree (and there aren't many of those).    Had UA and US shut down and liquidated, the remaining players would have picked up the pieces (and many of the employees) and continued to move the passengers around the country.      
 
Additionally, had they shut down, that would have removed some of the excess high-cost capacity from the country, helping the others.  
 
But instead of that, UA and US survived, albeit with huge paycuts and terminated pensions.   US then flew for eight more years solo,  dragging down the fare levels with its Advantage Fare program, which was aimed primarily at AA (where US connecting fares were much lower than AA's nonstop fares).   And thanks to the pilot war at US, Parker's airline had a huge labor cost advantage over its competitors, including AA.   A shutdown at US and UA would have been good.   
 
But however noble Arpey's view of bankruptcy may have been, it lacked the cold, calculating prowess of a winner in today's business climate.  Those who ignore the numbers and act on emotion are doomed to fail.   Including, eventually, Arpey himself.   Yes, the bastard extracted huge paycuts along with a variable compensation scheme that rewarded himself and other execs as AMR recovered from its $1.25/sh low in 2003 to $41/sh in January 2007.   For all his moral crusading on bankruptcy and promises kept - he was just another greedy bastard who wanted to share in the stockholders' windfall.   And windfall it was - I posted about my participation in that gluttony of riches.   
 
Once UA and US were able to terminate ALL of their employee pension obligations and foist them on the PBGC, the last act for AMR was written, but it would be a few years before we'd see it play out.   Eventually, the Board of Directors was convinced that Ch 11 was the only viable plan - helped by the pilots' rejection of AA's last offer just before the Ch 11 filing.   
 
Having finally filed for Ch 11, new management (since Arpey resigned rather than take AA into Ch 11) sought to use all the cost-saving tools that UA, US, DL and NW utilized, including terminating the pensions, which would preserve a lot of cash for years to come.   And all of a sudden, Gotbaum the Shithead was denying AMR the same benefit afforded to everyone else.   Remember the pro-merger employee cries of "All the other airlines got to merge and screw consumers - now it's AA's turn and the DoJ has no business interferring in AA's manifest destiny of merging with US and becoming the biggest airline."    Carried to its logical extreme, Laura Glading the Brilliant (she was delighted that the pensions were not terminated) was in favor of screwing consumers (since she was very pro-merger) and yet didn't want to over-tax the poor over-burdened PBGC by cutting AA's on-going pension costs.   How noble of her.   
 
I recognize that the pilots were VERY pleased that AA's pensions were frozen and not terminated.   I can also clearly see that all AA employees have long subsidized the pilot A plan (their defined benefit plan).   The most notable subsidies were the 2003 concessions instead of filing for Ch 11 then and the 2011 Ch 11 filing.   AA's pilots are not the highest paid in the industry but they're not far from the top.   AA's flight attendants aren't at the top, but they have long been close to the top.   
 
Can't say the same about AA's mechanics and fleet service.   AA's ground employees earn substantially less than their counterparts at WN, UPS, FedEX and even non-union jetBlue.   AA's TWU-represented employees have paid the biggest price for "saving the pensions."   Not only are your wages much lower than at the others I listed above, your retirement contributions are paltry.   On top of that, you now have no profit sharing just in time for AA's most profitable year EVER.   In the first six months of 2014,  the new AA has earned $1.9 billion before special items.   Unless oil prices skyrocket or unless the global conflicts magnify, AA is on track to earn about $4 billion in profits this year (before special items).   Horton the Devil offered everyone profit-sharing of 15% of first dollar profits.   That was his opening offer in the Term Sheets, for Chrissakes, and yet here you are today with ZERO profit sharing.   Competent unions would have demanded and held out for 20% profit sharing and would have applauded termination of all pensions.   The pilots could have been compensated with more stock to offset their A-plan termination and the only people who would have paid for that would be the holders of old AMR stock (AAMRQ) who would not have been enriched with a huge windfall.  Yep.  A second windfall about 10 years after the last time.  
 
Like I said - on a personal level, abandoning pensions is a bad thing.   And on that personal level, I agree with more of your views than you think.   But contributing $1.5 billion to the underfunded pensions in the three years 2012-14?   Might as well have set fire to a pile of cash.  Remember the "backpack of bricks?"  Well, the on-going pension contributions are another example of filling the backpack with bricks.   Or think of it this way:   Might as well just load 10,000 pounds of ballast onto every mainline flight.   Bags of sand would work.   That might help AA spend $720 million more on fuel this year with no corresponding benefit.   AA's pension contributions are no different.   AA had a legal right to abandon that expense and was bullied into keeping that expense, and the staggering part is that employees and union leaders cheered AA's higher on-going expenses as a result.
 
Anyway - back to the topic:   The combination of two unions that have consistently failed to achieve higher wages for their maintenance constituents doesn't look to me like the recipe for success.   If AA's mechanics and related want to go a different route, like with AMFA, they should be afforded that chance.     

 

[southwind]

Don't listen to a word 700 says. He gets a bonus for every person persuades, to join the IAM!
If you look at the other airline boards, there he is, with his charts and graphs, claiming the IAM is the light!

 

[WeAAsles]

Nonsense.   On a personal belief level, I agree with much of what you wrote.   Like Arpey, I saw airline bankruptcies and the casting off of promises and pension obligations as morally reprehensible.   
 
Years before you posted here, I posted here and elsewhere that in my view,  United and US Airways should have been shut down and liquidated to pay their pension promises (to the pilots, of course, since they were the ones who saw cuts to their accrued benefits).   
 
I was roundly criticized by many for such an unpopular view.   Here and elsewhere, people asked "how could I wish for tens of thousands of good people to lose their jobs?"   Well, it's an area where Bob Owens and I agree (and there aren't many of those).    Had UA and US shut down and liquidated, the remaining players would have picked up the pieces (and many of the employees) and continued to move the passengers around the country.      
 
Additionally, had they shut down, that would have removed some of the excess high-cost capacity from the country, helping the others.  
 
But instead of that, UA and US survived, albeit with huge paycuts and terminated pensions.   US then flew for eight more years solo,  dragging down the fare levels with its Advantage Fare program, which was aimed primarily at AA (where US connecting fares were much lower than AA's nonstop fares).   And thanks to the pilot war at US, Parker's airline had a huge labor cost advantage over its competitors, including AA.   A shutdown at US and UA would have been good.  

Agreed and at the time all of the analysts were saying the same thing. Of course all of that is from a business perspective and not a personal one which for all of the employees of those airlines that would have been. Now here we are finally at the end of the musical chair game that was started by Jimmy Carter back in 78.
 
But however noble Arpey's view of bankruptcy may have been, it lacked the cold, calculating prowess of a winner in today's business climate.  Those who ignore the numbers and act on emotion are doomed to fail.   Including, eventually, Arpey himself.   Yes, the bastard extracted huge paycuts along with a variable compensation scheme that rewarded himself and other execs as AMR recovered from its $1.25/sh low in 2003 to $41/sh in January 2007.   For all his moral crusading on bankruptcy and promises kept - he was just another greedy bastard who wanted to share in the stockholders' windfall.   And windfall it was - I posted about my participation in that gluttony of riches.  

That was on Carty but later on I also agree that Arpey did not have a mind for business and was hoping to thread the needle to get to the other side hoping for an economy that AA may have been able to survive and thrive in. More so a very naive train of thought that I'm surprised the BOD went along with as long as they did. And I don't think he profited as much as many might believe since his compensation was tied to the airlines performance and the monkey wasn't exactly doing tricks for the crowd.
 
Once UA and US were able to terminate ALL of their employee pension obligations and foist them on the PBGC, the last act for AMR was written, but it would be a few years before we'd see it play out.   Eventually, the Board of Directors was convinced that Ch 11 was the only viable plan - helped by the pilots' rejection of AA's last offer just before the Ch 11 filing.

The day before. Can't lose 250 pilots and have another 500 waiting in the wings to bail and still expect to fly airplanes. Airplanes don't fly and you have no airline business.   
 
Having finally filed for Ch 11, new management (since Arpey resigned rather than take AA into Ch 11) sought to use all the cost-saving tools that UA, US, DL and NW utilized, including terminating the pensions, which would preserve a lot of cash for years to come.   And all of a sudden, Gotbaum the Shithead was denying AMR the same benefit afforded to everyone else.   Remember the pro-merger employee cries of "All the other airlines got to merge and screw consumers - now it's AA's turn and the DoJ has no business interferring in AA's manifest destiny of merging with US and becoming the biggest airline."    Carried to its logical extreme, Laura Glading the Brilliant (she was delighted that the pensions were not terminated) was in favor of screwing consumers (since she was very pro-merger) and yet didn't want to over-tax the poor over-burdened PBGC by cutting AA's on-going pension costs.   How noble of her.

As far as screwing the consumers turnabout is fair play. They have been screwing us for over 20 years by not paying the price of the seat due to overcapacity and internet fairs. Why do you think the airlines now charge for everything minus putting a slot in the bathroom for quarters. Remember IdeAAs? Think I'll submit that one. 
 
I recognize that the pilots were VERY pleased that AA's pensions were frozen and not terminated.   I can also clearly see that all AA employees have long subsidized the pilot A plan (their defined benefit plan).   The most notable subsidies were the 2003 concessions instead of filing for Ch 11 then and the 2011 Ch 11 filing.   AA's pilots are not the highest paid in the industry but they're not far from the top.   AA's flight attendants aren't at the top, but they have long been close to the top.

Looking at it from a non employee, non affected business lens. Yes AA should have filed for bankruptcy in 2003. As an employee with only 8 years at the time I'm glad they didn't. Personal self interest of course.  
 
Can't say the same about AA's mechanics and fleet service.   AA's ground employees earn substantially less than their counterparts at WN, UPS, FedEX and even non-union jetBlue.   AA's TWU-represented employees have paid the biggest price for "saving the pensions."   Not only are your wages much lower than at the others I listed above, your retirement contributions are paltry.   On top of that, you now have no profit sharing just in time for AA's most profitable year EVER.   In the first six months of 2014,  the new AA has earned $1.9 billion before special items.   Unless oil prices skyrocket or unless the global conflicts magnify, AA is on track to earn about $4 billion in profits this year (before special items).   Horton the Devil offered everyone profit-sharing of 15% of first dollar profits.   That was his opening offer in the Term Sheets, for Chrissakes, and yet here you are today with ZERO profit sharing.   Competent unions would have demanded and held out for 20% profit sharing and would have applauded termination of all pensions.   The pilots could have been compensated with more stock to offset their A-plan termination and the only people who would have paid for that would be the holders of old AMR stock (AAMRQ) who would not have been enriched with a huge windfall.  Yep.  A second windfall about 10 years after the last time.

You're entitled to your perspective and I have mine. Mine is not the popular one on this thread though so I'm not going to repeat it all over. 
 
Like I said - on a personal level, abandoning pensions is a bad thing.   And on that personal level, I agree with more of your views than you think.   But contributing $1.5 billion to the underfunded pensions in the three years 2012-14?   Might as well have set fire to a pile of cash.  Remember the "backpack of bricks?"  Well, the on-going pension contributions are another example of filling the backpack with bricks.   Or think of it this way:   Might as well just load 10,000 pounds of ballast onto every mainline flight.   Bags of sand would work.   That might help AA spend $720 million more on fuel this year with no corresponding benefit.   AA's pension contributions are no different.   AA had a legal right to abandon that expense and was bullied into keeping that expense, and the staggering part is that employees and union leaders cheered AA's higher on-going expenses as a result.

About time the Bully wound up being the workers. Nice change of pace if you ask me. Oh and that was "Bricks in a backpack" That comment was made by a high level manager to describe the workers who if they weren't around even he wouldn't be paid. The workers are the oil and the cogs. Management is just the ones who watch the wheels turn ultimately. AA is a group of people not some name on the side of an airplane. It was around long before all of us and now will be around long after all of us are gone.

Thank the Unions for that otherwise we would have had a disastrous stand alone plan that everyone from analysts to shareholders to banks and workers knew was stupid and doomed to failure.  
 
Anyway - back to the topic:   The combination of two unions that have consistently failed to achieve higher wages for their maintenance constituents doesn't look to me like the recipe for success.   If AA's mechanics and related want to go a different route, like with AMFA, they should be afforded that chance.

Sure if that's what they decide. Back to the topic.   

 

[Real tired]

Just because there isn't a deduction, doesn't mean that it's not coming out of the employee's pocket. The company is just putting money into the pension instead of in the empolyee's pockets.

Exactly.
 
When the company plan was terminated in '05, the IAM negotiated us $50 per week company match into our 401k plans.  This showed up on my pay check every week until the IAM pension plan was voted in.
 
This is where the money came from.  The money was mine, from the company, going into a fund I could manage, that went to a plan I could no longer manage.

 

[Real tired]

At this moment I'm more of an advocate for a larger 401k match. But I also would have no problem with the IAMPF being offered to our members as an alternative if they want a CHOICE. But I would not want to see the pension offered up to us as the ONLY option. There are too many stipulations that I have read in it and with those stipulations attached is why I would have to take a pass.

It can be modified basically at will as well and is insured for far less by the PBGC if something were ever to happen to it and it went insolvent and had to be passed on to them. 

I'm currently not a fan of the plan for me but when and or if the time comes I'll evaluate it again as best I can and make my choice as informed as possible.

This is why we resisted the plan for 3 years.
 
And, at last check, if the IAM plan were to default into the PBGC, my return would be worth 35 cents on the dollar.

 

[Real tired]

No, that's not how it works.   Not at all.
 
If a plan is terminated but has sufficient funding to pay the promised benefits, then the PBGC pays the promised benefits.
 
if a plan is terminated but is underfunded and does not have funding to pay the promised benefits, then the PBGC pays the promised benefits subject to the maximum monthly benefit (which is a function of the age on which you retired and begin collecting benefits).

Almost.
 
In our case, we the plan was terminated in '05, we had people here with 30 or 35 years with the company in 2005.  They got the maximum monthly benefit the PBGC allowed at the time the plan was terminated.  Then we had people with less time with the company, such as myself, who at retirement, will get a whole lot less than the monthly PBGC maximum.
 
In my case, under the PBGC, when I retire, I will get a little bit more than half of what I would have got under the old USAir 85 point plan.
 
So not only is it a matter of age at retirement, the amount of years at the company before termination is a function, as is the employee group you were in, and the year your plan was terminated as the PBGC monthly max changes yearly.

 

[xUT]

Nonsense.   On a personal belief level, I agree with much of what you wrote.   Like Arpey, I saw airline bankruptcies and the casting off of promises and pension obligations as morally reprehensible.   
 
Years before you posted here, I posted here and elsewhere that in my view,  United and US Airways should have been shut down and liquidated to pay their pension promises (to the pilots, of course, since they were the ones who saw cuts to their accrued benefits).   
 
I was roundly criticized by many for such an unpopular view.   Here and elsewhere, people asked "how could I wish for tens of thousands of good people to lose their jobs?"   Well, it's an area where Bob Owens and I agree (and there aren't many of those).    Had UA and US shut down and liquidated, the remaining players would have picked up the pieces (and many of the employees) and continued to move the passengers around the country.      
 
Additionally, had they shut down, that would have removed some of the excess high-cost capacity from the country, helping the others.  
 
But instead of that, UA and US survived, albeit with huge paycuts and terminated pensions.   US then flew for eight more years solo,  dragging down the fare levels with its Advantage Fare program, which was aimed primarily at AA (where US connecting fares were much lower than AA's nonstop fares).   And thanks to the pilot war at US, Parker's airline had a huge labor cost advantage over its competitors, including AA.   A shutdown at US and UA would have been good.   
 
But however noble Arpey's view of bankruptcy may have been, it lacked the cold, calculating prowess of a winner in today's business climate.  Those who ignore the numbers and act on emotion are doomed to fail.   Including, eventually, Arpey himself.   Yes, the bastard extracted huge paycuts along with a variable compensation scheme that rewarded himself and other execs as AMR recovered from its $1.25/sh low in 2003 to $41/sh in January 2007.   For all his moral crusading on bankruptcy and promises kept - he was just another greedy bastard who wanted to share in the stockholders' windfall.   And windfall it was - I posted about my participation in that gluttony of riches.   
 
Once UA and US were able to terminate ALL of their employee pension obligations and foist them on the PBGC, the last act for AMR was written, but it would be a few years before we'd see it play out.   Eventually, the Board of Directors was convinced that Ch 11 was the only viable plan - helped by the pilots' rejection of AA's last offer just before the Ch 11 filing.   
 
Having finally filed for Ch 11, new management (since Arpey resigned rather than take AA into Ch 11) sought to use all the cost-saving tools that UA, US, DL and NW utilized, including terminating the pensions, which would preserve a lot of cash for years to come.   And all of a sudden, Gotbaum the Shithead was denying AMR the same benefit afforded to everyone else.   Remember the pro-merger employee cries of "All the other airlines got to merge and screw consumers - now it's AA's turn and the DoJ has no business interferring in AA's manifest destiny of merging with US and becoming the biggest airline."    Carried to its logical extreme, Laura Glading the Brilliant (she was delighted that the pensions were not terminated) was in favor of screwing consumers (since she was very pro-merger) and yet didn't want to over-tax the poor over-burdened PBGC by cutting AA's on-going pension costs.   How noble of her.   
 
I recognize that the pilots were VERY pleased that AA's pensions were frozen and not terminated.   I can also clearly see that all AA employees have long subsidized the pilot A plan (their defined benefit plan).   The most notable subsidies were the 2003 concessions instead of filing for Ch 11 then and the 2011 Ch 11 filing.   AA's pilots are not the highest paid in the industry but they're not far from the top.   AA's flight attendants aren't at the top, but they have long been close to the top.   
 
Can't say the same about AA's mechanics and fleet service.   AA's ground employees earn substantially less than their counterparts at WN, UPS, FedEX and even non-union jetBlue.   AA's TWU-represented employees have paid the biggest price for "saving the pensions."   Not only are your wages much lower than at the others I listed above, your retirement contributions are paltry.   On top of that, you now have no profit sharing just in time for AA's most profitable year EVER.   In the first six months of 2014,  the new AA has earned $1.9 billion before special items.   Unless oil prices skyrocket or unless the global conflicts magnify, AA is on track to earn about $4 billion in profits this year (before special items).   Horton the Devil offered everyone profit-sharing of 15% of first dollar profits.   That was his opening offer in the Term Sheets, for Chrissakes, and yet here you are today with ZERO profit sharing.   Competent unions would have demanded and held out for 20% profit sharing and would have applauded termination of all pensions.   The pilots could have been compensated with more stock to offset their A-plan termination and the only people who would have paid for that would be the holders of old AMR stock (AAMRQ) who would not have been enriched with a huge windfall.  Yep.  A second windfall about 10 years after the last time.  
 
Like I said - on a personal level, abandoning pensions is a bad thing.   And on that personal level, I agree with more of your views than you think.   But contributing $1.5 billion to the underfunded pensions in the three years 2012-14?   Might as well have set fire to a pile of cash.  Remember the "backpack of bricks?"  Well, the on-going pension contributions are another example of filling the backpack with bricks.   Or think of it this way:   Might as well just load 10,000 pounds of ballast onto every mainline flight.   Bags of sand would work.   That might help AA spend $720 million more on fuel this year with no corresponding benefit.   AA's pension contributions are no different.   AA had a legal right to abandon that expense and was bullied into keeping that expense, and the staggering part is that employees and union leaders cheered AA's higher on-going expenses as a result.
 
Anyway - back to the topic:   The combination of two unions that have consistently failed to achieve higher wages for their maintenance constituents doesn't look to me like the recipe for success.   If AA's mechanics and related want to go a different route, like with AMFA, they should be afforded that chance.

I agree to a point.
However, how can one expect self immolation when AA/CO/DA accepted concessions on the 'threat' of BK?
It's great telling 'someone else' to fall on their sword yet lack the tenacity to make a stand.
IMHO, had the rest of the industry said 'no' to concessions, that would have given great incentive to us with a gun at our heads.
Revisionist theory at it's best.
JMHO
B) xUT

 

[700UW]

Don't listen to a word 700 says. He gets a bonus for every person persuades, to join the IAM!
If you look at the other airline boards, there he is, with his charts and graphs, claiming the IAM is the light!

Please show me where I am getting a bonus or paid from the IAM, it would sure be nice if I did, then I wouldnt have to work my ONLY job that I have, which isnt for the IAM.
 
Its truly amazing that you are allowed to touch anything in regards to an airplane with your lack of intelligence.
 
Why dont you pay your bet off to Kevin?
 
Yes posters, Southwind bet Kevin on the boards and lost and was suppose to donate the money to charity, and to this day, he hasnt paid, guess he is nothing but a welcher.
 
He comes on here and preaches AMFA on this thread and the US, yet he tells ACS and FAs at DL not to vote in a union and when called out by Kevin, he admitted he doesnt want a union nor AMFA at DL.