Highest measure of hypocrisy

[proAMT]

Goes to the National Mediation Board (NMB) for taking over six weeks and counting to determine whether or not there is a sufficient amount of interest in having a union representational election for the mechanics and related at AA after turning away over 6000 cards from the workers for not being turned in in time.
A perod in which AMFA supporters were given less than six hours to get thier proof of interest from Dallas to Washington. The wheel is tilted.

Shame on the NMB

 

[TWU informer]

Goes to the National Mediation Board (NMB) for taking over six weeks and counting to determine whether or not there is a sufficient amount of interest in having a union representational election for the mechanics and related at AA after turning away over 6000 cards from the workers for not being turned in in time.
A perod in which AMFA supporters were given less than six hours to get thier proof of interest from Dallas to Washington. The wheel is tilted.

Shame on the NMB

We knew that since 2003 filing

 

[OldGuy@AA]

Just think of what the TWU owes AA now that they are helping them beat AMFA for the second time? More givebacks I'm sure.

 

[Ed Norton]

Thank God that we have a democrat in the White House!

 

[OldGuy@AA]

Thank God that we have a democrat in the White House!

Like it or not it's the only reason our pension was frozen instead of terminated. You think a GOP appointed stooge in charge of the PBGC would have fought AA in BK court? Think again.

 

[FWAAA]

Like it or not it's the only reason our pension was frozen instead of terminated. You think a GOP appointed stooge in charge of the PBGC would have fought AA in BK court? Think again.

How, exactly, did the pension freeze help you (compared to a pension termination)?

Thanks to Gotbaum's persistence, AA's on-going pension costs will be higher than Delta or United, both of which terminated their pilot pensions (UA terminated all of its pensions).

Unless you're a pilot, you'd get as much with a termination as you will get with the freeze. The only workgroup helped by the freeze are the pilots, who will get a lot more than they would have with a termination. And in return, AA didn't lower costs as much as the other bankrupt airlines. Money that new AA spends on pension contributions for everyone (instead of terminating them and foisting them off to the PBGC) is money that isn't available to spend on mechanics' wages and benefits.

Ultimately, your future pay and benefits will be lower thanks to Gotbaum's actions.

 

[OldGuy@AA]

A terminated pension is paid by the PBGC until they run out of money then what? You think the teabaggers in Washington are going to make sure you get your pension? It is common knowledge that the PBGC cannot afford to cover all the pensions it has now, never mind ours which is grossly underfunded. And apparently you have not been paying attention. All the big wheels in management are saying there will be billions of profits.

 

[john john]

How, exactly, did the pension freeze help you (compared to a pension termination)?

And your AA Cost benefit analysis will be the topic of future talks unlike a terminated pension

 

[eolesen]

Ultimately, your future pay and benefits will be lower thanks to Gotbaum's actions.

Perhaps, but as a fiscal conservative, it was the proper way to handle it --- make the employer who promised the benefits (or their corporate successor) be responsible for funding them.

There's no good excuse I can think of which would justify third parties being expected to clean up the mess left behind when there's a clear corporate successor (as there is with both UA and DL), whether it be thru PBGC insurance premiums for those companies who still have DBP's or taxpayers when the PBGC runs out of money.

I know we're getting into public policy issues here, but at some point, the PBGC was going to rebel. And I'd love to see someone take a retroactive action against DL & UA...

 

[FWAAA]

A terminated pension is paid by the PBGC until they run out of money then what? You think the teabaggers in Washington are going to make sure you get your pension? It is common knowledge that the PBGC cannot afford to cover all the pensions it has now, never mind ours which is grossly underfunded. And apparently you have not been paying attention. All the big wheels in management are saying there will be billions of profits.

So now, you trust airline management to find enough money to keep the pension checks coming but you don't think Gotbaum and the rest of the PBGC is smart enough to come up with the money? Your post smacks of the common refrain of "Social Security will run out of money and I won't get my checks." If the PBGC runs out of money, there would of course be a political fight, but the taxpayers would eventually bail them out, just like the recurring bailouts of the financial industry.

Perhaps, but as a fiscal conservative, it was the proper way to handle it --- make the employer who promised the benefits (or their corporate successor) be responsible for funding them.

As a fiscal conservative, I agree with you. Forcing AA to keep laying out hundreds of millions of dollars a year is the right thing. Hell, Arpey did the right thing - thousands of pilots received hundreds of thousands of dollars each that they would not have received if AA had filed for Ch 11 in 2003 and terminated its pensions. And even the lower paid rank and file accumulated an additional nine years of benefits, and AA contributed more than $2 billion to the pension trusts in those nine years.

I argued that US and UA should have been liquidated when they terminated their pensions, but that was deemed "heartless and cruel" here and and other fora (think of all those low-wage bottom feeding pilots, FAs, mechanics, fleet service and agents who would be out of jobs - well at least until other airlines hired them).

Thing is, the pension expense has been a huge, heavy brick in the backpack for those nine years, and now, even though AA finally bit the bullet and filed for Ch 11, all they accomplished on the pension front was a freeze, leaving AA on the hook for billions of contributions above and beyond those faced by UA. Even though DL terminated its pilot pensions, its level of underfunding was so severe that its frozen pensions consume as much cash as AA's pre-bankruptcy pensions.

Recall all the ignorant knashing of teeth when Bob Owens and Dave learned that, gasp, AA was still paying lease payments on several F-100s, and it was extravegant spending like that which caused AA's bankruptcy, not higher labor costs? Requiring that AA keep paying several hundred million a year on its frozen pensions is like keeping a fleet of hundreds of late-model planes in the desert that AA doesn't fly but must make the lease payments. Those F-100s likely didn't cost $100k/year in lease costs, but AA employees are actually celebrating higher on-going costs for AA forever in the neighborhood of hundreds of millions of dollars without any of that money flowing into their pocket (other than the pilots).

THAT's what I'm laughing at.

There's no good excuse I can think of which would justify third parties being expected to clean up the mess left behind when there's a clear corporate successor (as there is with both UA and DL), whether it be thru PBGC insurance premiums for those companies who still have DBP's or taxpayers when the PBGC runs out of money.

I know we're getting into public policy issues here, but at some point, the PBGC was going to rebel. And I'd love to see someone take a retroactive action against DL & UA.

Agreed. Don't forget retroactive action against AA, as US terminated all of its woefully underfunded pensions as well. I'm arguing for a level playing field, so Parker should have to pay even more to cover BoeingBoy and all the other victims of fomer Crystal City US management.

 

[OldGuy@AA]

So now, you trust airline management to find enough money to keep the pension checks coming but you don't think Gotbaum and the rest of the PBGC is smart enough to come up with the money? Your post smacks of the common refrain of "Social Security will run out of money and I won't get my checks." If the PBGC runs out of money, there would of course be a political fight, but the taxpayers would eventually bail them out, just like the recurring bailouts of the financial industry.



As a fiscal conservative, I agree with you. Forcing AA to keep laying out hundreds of millions of dollars a year is the right thing. Hell, Arpey did the right thing - thousands of pilots received hundreds of thousands of dollars each that they would not have received if AA had filed for Ch 11 in 2003 and terminated its pensions. And even the lower paid rank and file accumulated an additional nine years of benefits, and AA contributed more than $2 billion to the pension trusts in those nine years.




.

I Don't trust AA management at all but I also don't trust the government. At least with a frozen pension I will get something. With a terminated pension in the hands of an underfunded PBGC I stand to get pennies on the dollar. But as a fiscal conservative I am sure you would not have any problem with us getting screwed out of it. Also people like you (teabaggers) would fight the government getting involved in it to bail it out.

 

[proAMT]

Another week of hypocrisy from a group that turned away over 6,000 cards and has been considering thousands of teamster cards. I'm sure in the end they'll find a "lack of interest".

Thousands of cards from teamster supporters thousands of cards from AMFA supporters.

Go ahead NMB screw us out of another one.

 

[WorldTraveler]

Perhaps, but as a fiscal conservative, it was the proper way to handle it --- make the employer who promised the benefits (or their corporate successor) be responsible for funding them.

There's no good excuse I can think of which would justify third parties being expected to clean up the mess left behind when there's a clear corporate successor (as there is with both UA and DL), whether it be thru PBGC insurance premiums for those companies who still have DBP's or taxpayers when the PBGC runs out of money.

I know we're getting into public policy issues here, but at some point, the PBGC was going to rebel. And I'd love to see someone take a retroactive action against DL & UA...

I thought the right thing was to never file for BK in the first place, in the interest of preserving the value of the company for stockholders. That's what we've heard here for years and yet it happened anyway....

Let's be very clear... the PBGC did not FORCE AA to retain its pensions. They simply said they would take a very significant piece of the company as part of the BK process. The simple reason why AMR backed down in terminating is because the creditors didn't want to see their share of the company eroded because of shares given to the PBGC.

Let's also be very clear that DL has more employees covered under frozen pensions than the new AA or UA will; there is no glory in what AA has done relative to anyone else. New AA will have employees with terminated pensions just as DL and UA have. UA has DB current pension responsibilities for former CO employees while DL has frozen pension responsibilities for all combined DL and NW employee groups except PMDL pilots. DL gave its pilots a $2B BK claim plus what the PBGC got so the cost of termination is not only costly but it was prohibitive for DL to terminate any further pensions. More significantly, DL is meeting its pension funding obligations and is paying an additional $1B above its funding obligations.

If AA had remained independent, then you could indeed tout its handling of pensions relative to other legacies but AA is not going to emerge as a standalone company and, during BK, its pension obligations continue to grow without being funded. You can absolutely be assured, FWAAA, that AA's pension underfunding will not look near as rosy post BK compared to DL as it did before BK.

I am glad that AA will be retaining the pensions for its employees but it will be costly in terms of cash to do so; instead of giving the creditors a bigger share of the company in BK, AA has to generate more cash to meet its obligations post BK. In time, new AA may well decide to accelerate funding of its frozen pensions but you can absolutely be assured that step won't come until AA is solidly and consistently profitable.

The BK process is a process of swapping debt for equity. The PBGC got a significant piece of every airline that terminated pensions in BK in the 2000s just like happened with other creditors.... the only real difference between the AA BK and others is that AA may very well end up redistributing shares to pre-BK stockholders, something that has not happened before.

 

[OldGuy@AA]

As I said. The PBGC fought AA in the BK court. AA had been severely underfunding the pension for years and the PBGC demanded AA either fully fund them or give them a share of the company which would have been substantial considering the millions of dollars they should have but didn't put into the pension. AA didn't want to do that so, in my opinion, The PBGC did force AA to retain them.

 

[WorldTraveler]

Given the significant underperformance of the stock market in the 2000s compared to the 90s, it was practically impossible to keep pensions for any company fully funded, esp. for companies that were shrinking the number of employees, as legacy airlines did during the 2000s; it took the influx of new, junior employees into the pension fund to keep the pensions solvent - no different from what is happening in developing vs develop countries' social security systems.
AA could have terminated its pension plans but the cost was going to be high and above what the creditors were willing to pay in terms of diluted claims. The likelihood of AA terminating its plans was greatly reduced because DL and NW retained the majority of their pensions in BK and DL has been able to handle the "burden" of funding their frozen pension plans in addition to their 401K programs for current pension benefits. There was no example of that kind or legislation to support a freeze instead of a termination when UA and US terminated. In some regards, AA gained benefits by being the last in BK in terms of figuring out how to retain some value for its pre-BK stockholders but it also has to live with the example of airlines that did manage to retain pensions and not terminate them as UA and US and others before did.