Pension Dumping: The Reasons, the Wreckage, the Stakes for Wall Street
There are more than enough experts interviewed and quoted, from pension actuaries and investment bankers to human-resources consultants. And journalist-author (Inside the FDA, 2005; and The Merck Druggernaut, 2005) Hawthorne boasts impeccable credentials, including stints at such well-respected publications as Fortune and Institutional Investor. So why does this exposé on pension-plan terminations by U.S. corporations (occurring usually before bankruptcy decisions are made) seem so, well, inconsequential? It’s true that the federal ERISA regulations leave way too many loopholes, that unions (and companies) cave in to the threat of job loss, and that vulture capitalists eagerly await the dumping of pension plans. In fact, Hawthorne marshals her business case brilliantly, detailing the legal process of restructuring, examples (U.S. Airways, LTV), the pinpointing of “nexts to fail,” and an all-too-short section on solutions. Yet until the mass media produces a coast-to-coast outcry, fueled by both retirees and employees, pensions seem to be headed toward extinction. --Barbara Jacobs