A&P Supermarket Chain Stiffs 21,000 Pensioners, Government Will Pick Up $288 Million Tab

[Judi Lynn]

Wednesday, Mar 23, 2016, 7:23 pm

A&P Supermarket Chain Stiffs 21,000 Pensioners, Government Will Pick Up $288 Million Tab

BY Bruce Vail

The bankruptcy and speedy sell-off of the A&P supermarket chain last year has revealed three pension plans covering more than 21,000 former employees as a financial train wreck, forcing a U.S. government agency to come to the rescue at the cost of about $288 million.

The announcement was made last week by the Pension Benefit Guaranty Corporation (PBGC), a federal agency that insures pensions managed by private companies. PBGC is assuming direct control over the failed plans and will be responsible for making monthly pension payments to the former employees for decades into the future, according to spokesperson Nidia Yáñez.

The PBGC rescue was triggered when the bankrupt grocery chain—which operated some 300 stores in six states in the Mid-Atlantic region—sold off its assets while firing almost all of its 28,000 employees. That left the three pension plans with no source of future income, but too little cash to pay the pension benefits already earned by the former A&P employees, Yáñez says.

These pension programs are separate and distinct from the joint labor-management plans handled together with locals of the United Food and Commercial Workers (UFCW) union, Yáñez adds. (UFCW represented the bulk of the unionized work force.) Although damaged by the bankruptcy of A&P and its 20 affiliated companies, these union plans have not sought financial assistance from PBGC, she tells In These Times.

More:
http://inthesetimes.com/working/entry/18999/ap_supermarket_chain_stiffs_21000_pensioners_government_will_pick_up_288_mi

[brewens]

1. I'd love to know how many right-wingers are still collecting a partial pension at least courtesy of

the PBGC? Probably not real rabid about the guvmint keepin' it's hands of their pensions are they?

I tried to have a little fun a couple of years ago trolling the Freepers over the PBCG. Like, "I don't get a pension, how come my tax dollars go to give those people a pension? They worked for a company that was a dog and they lost. To freakin' bad! I can't afford to make up for it!"

I was kind of getting at Mitt Romney and his "Goodfella's" mob style corporate "bust outs". It's maddening to know that some right-wing shit stain is still collecting it's partial pension and social security, totally oblivious to how bad it got robbed by it's own side.

[antigop]

2. Your tax dollars do not fund the PBGC. PBGC receives no funds from general tax revenues.

http://pbgc.gov/about/how-pbgc-operates.html

PBGC receives no funds from general tax revenues. Operations are financed by insurance premiums set by Congress and paid by sponsors of defined benefit plans, investment income, assets from pension plans trusteed by PBGC, and recoveries from the companies formerly responsible for the plans.

[kristopher]

4. So it's an indirect pipeline from labor to the corporate robbers.

All of those funding sources look to be dependent on the invested income. That means it is money that otherwise would go to secure benefits for the retired workers.
Instead, it is a form of a convoluted tax that allows the robbers to provide a phony justification to Congress (who gets a cut as campaign contributions) putting them in charge of the cash rich henhouse with little oversight.

[antigop]

5. it's a form of insurance. And if you look at the premiums that companies pay to the PBGC,

the premiums per person aren't that high, although the corporations scream about them.

The PBGC has successfully stepped in numerous times to cover pensions for employees of companies that went belly up.

[kristopher]

6. I understand what it is. It is a de facto tax paid by the retirees to the thieves.

The premium is money earned by the retirement funds - and it begins its life belonging to the retirees.

After a circuitous legislated route that launders ownership of the money, it ends up in the pocket of corporate thieves, not the retirees.

The retirees do not cause the loss, corporate thieves do.

The corporate thieved do not pony up the money for the premiums, it comes off the top of the money earned by the investment of the retiree's funds.

Paying those premiums does not reduce the earnings of the corporations managing the funds, it reduces the payout to the retirees.

The entire scheme is structured in this manner because the legislation is written to benefit the corporations that make large campaign donations to Congress.



APRIL 18, 2014
Is America an Oligarchy?
BY JOHN CASSIDY
From the Dept. of Academics Confirming Something You Already Suspected comes a new study concluding that rich people and organizations representing business interests have a powerful grip on U.S. government policy. After examining differences in public opinion across income groups on a wide variety of issues, the political scientists Martin Gilens, of Princeton, and Benjamin Page, of Northwestern, found that the preferences of rich people had a much bigger impact on subsequent policy decisions than the views of middle-income and poor Americans. Indeed, the opinions of lower-income groups, and the interest groups that represent them, appear to have little or no independent impact on policy....
http://www.newyorker.com/news/john-cassidy/is-america-an-oligarchy


The original study:

From the Sept 2014 journal "Perspectives on Politics"

Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens
Martin Gilens and Benjamin I. Page

ABSTRACT

Each of four theoretical traditions in the study of American politics—which can be characterized as theories of Majoritarian Electoral Democracy, Economic-Elite Domination, and two types of interest-group pluralism, Majoritarian Pluralism and Biased Pluralism—offers different predictions about which sets of actors have how much influence over public policy: average citizens; economic elites; and organized interest groups, mass-based or business-oriented.
A great deal of empirical research speaks to the policy influence of one or another set of actors, but until recently it has not been possible to test these contrasting theoretical predictions against each other within a single statistical model. We report on an effort to do so, using a unique data set that includes measures of the key variables for 1,779 policy issues.
Multivariate analysis indicates that economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while average citizens and mass-based interest groups have little or no independent influence. The results provide substantial support for theories of Economic-Elite Domination and for theories of Biased Pluralism, but not for theories of Majoritarian Electoral Democracy or Majoritarian Pluralism.

The last paragraph of their findings:

Despite the seemingly strong empirical support in previous studies for theories of majoritarian democracy, our analyses suggest that majorities of the American public actually have little influence over the policies our government adopts. Americans do enjoy many features central to democratic governance, such as regular elections, freedom of speech and association, and a wide-spread (if still contested) franchise. But we believe that if policymaking is dominated by powerful business organizations and a small number of affluent Americans, then America’s claims to being a democratic society are seriously threatened.

https://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf

"...America’s claims to being a democratic society are seriously threatened."

[antigop]

7. NO, please educate yourself. The premiums ARE PAID BY THE CORPORATIONS.

I am done with this. I have to go to work.

[kristopher]

8. Thanks, but I'm extremely well educated on the topic of policy.

You're the one that isn't thinking critically even after having it laid out for you at a grade school level.

[Igel]

9. Since you think of the PBGC as "thieves," perhaps

less critical and more thinking is in order.

This program is managed by the government. It's set up very much like the SSA, except that the revenues aren't simple taxes, general revenues, that are earmarked by Congress and treated as though they were somehow a separate revenue stream when they're not. If they're thieves by virtue of collecting income from taxpaying entities, then Obama and Sanders and all those government employees are also thieves. That's quite a stretch. You need some evidence before you show such blatant disrespect to people you've heard and seen nothing out of except that they receive money. Class warriorism isn't an adequate basis.

Ultimately *everything* paid by corporations is paid by the consumers. It's not all paid by the employees, which take materials they don't produce and add labor or sales expertise or management skills or logistics or transportation (remember, the vice-presidents and janitors and accountants are also employees). For pay. That's how it was, rhetoric notwithstanding, under such stalwarts of state capitalism as the USSR and the PRC.


Why the businesses go out of business is a different story. My parents worked for Bethlehem Steel. Between wild cat strikes and very high wages, corporate mismanagement, political interference and restrictions (some Big Boy interference, some voter interference), and federal policy under Johnson, Nixon, and Carter, plus structural changes in the steel market and supply chain and competition from abroad, Beth Steel had no chance at succeeding. It's convenient to point at one of those factors and simply be blind to the ones that are inconvenient to one's argument, but all of them played a role. Being blind by intent or predilection is seldom a logical or sound strategy. (It's often the winning ticket in politics and ideology, and some academic disciplines. But I digress and, for many, transgress. I'm being very gressive today, I guess.)

Ah, I'd also note, in the interest of critical thinking, that when we talked about the A&P employees' earned income their "earned pensions" were not part of it, but as soon as we talk about their retirement, well, damn, it's earned and it's part of their due compensation. However, when we talk about other people's compensation we make a point of including it as a kind of hourly wage. Such double standards and cognitive biases are a good part of what critical thinking is all about, not "getting back to proving what I always believed."

[kristopher]

10. That rant does exactly nothing to refute or refine my thesis

Nothing.

Allow me:

The premium is money earned by the retirement funds - and it begins its life belonging to the retirees.

After a circuitous legislated route that launders ownership of the money, it ends up in the pocket of corporate thieves, not the retirees.

The retirees do not cause the loss, corporate thieves do.

The corporate thieved do not pony up the money for the premiums, it comes off the top of the money earned by the investment of the retiree's funds.

Paying those premiums does not reduce the earnings of the corporations managing the funds, it reduces the payout to the retirees.

The entire scheme is structured in this manner because the legislation is written to benefit the corporations that make large campaign donations to Congress.

This is corporate welfare.

[awoke_in_2003]

3. Socialize the risk

Privatize the profit. Freedumb.