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January 29, 2006

Where the Pension Money Went

-- by Dave Johnson

Almost every conversation I have with someone over a certain age turns to how they have either lost or afraid they will lose their health insurance and pension.

In the Reagan days, they sold people on the idea that 401Ks were somehow a good thing, and started moving everyone off of pensions. But a pension means your company puts the money away for you, on top of your pay. A 401K means it is entirely on the worker to fund retirement out of a shrinking paycheck. And people just can't do that - take home pay goes almost entirely to the bills.

Meanwhile corporate profits are WAY up since pensions were replaced by 401Ks. Part of that if from the money that had been used for worker retirements and gave it out as profits instead.

Don't be fooled - the sharehlders are not "all of us" they are primarily the top one percent of with the rest in the hands of the next couple of percent.

Corporate Wealth Share Rises for Top-Income Americans

New government data indicate that the concentration of corporate wealth among the highest-income Americans grew significantly in 2003, as a trend that began in 1991 accelerated in the first year that President Bush and Congress cut taxes on capital.

In 2003 the top 1 percent of households owned 57.5 percent of corporate wealth, up from 53.4 percent the year before, according to a Congressional Budget Office analysis of the latest income tax data. The top group's share of corporate wealth has grown by half since 1991, when it was 38.7 percent.

So now the scam is not just shifting people away from pensions but taking pensions away from people who have already earned them, like what happened at United Airlines. What happened is that those pensions were supposed to be funded, with the companies putting money into the accounts each year. But the corporations didn't fund them, instead handed the money over to the shareholders as profits. And now, having handed the pension money out to their shareholders they're saying "hey, we can't afford to meet these obligtions."

Well, where DID the money go? It went out to the shareholders (the top few percent) as profits - the very same capital gains and dividends that Bush has arranged will not be taxed at all, not even to help the government pay part of the pensions that the corporations stole.

Anyone recognize this song?

Efficiency and progress is ours once more
Now that we have the Neutron bomb
It's nice and quick and clean and gets things done
Away with excess enemy
But no less value to property
No sense in war but perfect sense at home:

The sun beams down on a brand new day
No more welfare tax to pay
Unsightly slums gone up in flashing light
Jobless millions whisked away
At last we have more room to play
All systems go to kill the poor tonight

Gonna
Kill kill kill kill Kill the poor:Tonight

Behold the sparkle of champagne
The crime rate's gone
Feel free again
O' life's a dream with you, Miss Lily White
Jane Fonda on the screen today
Convinced the liberals it's okay
So let's get dressed and dance away the night

While they:
Kill kill kill kill Kill the poor:Tonight

-- Kill the Poor by The Dead Kennedys

Posted by Dave Johnson at January 29, 2006 6:23 PM

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Comments

It was also Reagan's policy decision that interpreted that 'over funded' pension plans are assets of the company. Consequently takeover artists like Harold Simmons bought out companies at their artifically low share price, more than paid themselves back with overfunded pension assets, froze the pension plans and walked away grinning!

Posted by: pwb at January 30, 2006 8:00 AM

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