5 ms·

and now (through no fault of their own) the company is dying and can't afford it, because they managed their money poorly For example, by giving their workers

by eds 17y ago

and now (through no fault of their own) the company is dying and can't afford it, because they managed their money poorly For example, by giving their workers pensions and other compensation far exceeding their market value.

olefoo 17y ago
You do not understand a very basic fact about pensions; namely that they are an obligation that the company has. Your statement makes as much sense as saying that the company is in financial trouble because they have paid loans back in years past. For the company to default on the pensions that they owe is just as bad if not worse as if they were to default on their line of credit with a bank.
- mattmcknight 17y ago
  They shouldn't be an obligation that the company has, that's what makes them suck. They should be separately held funds that can survive beyond the lifetime of the company (like 401k plans). To make them company obligations is to invite disaster. It's analogous to the situation at GM where each current worker covers the health care of 10 other people. If you want a pension plan because you trust and want to pay pension plan administrators to manage your assets, it needs to be a separate financial entity from the company itself.
  - olefoo 17y ago
    Think of it this way, the fact that it's an obligation is interface; that it was not implemented as a stand-alone fund is the responsibility of the managers. And given what has happened in the financial world in recent years... it's quite possible that stand-alone funds would have been completely wiped out through mismanagement or outright theft.
- eds 17y ago
  That's interesting, I was under the impression that pensions were an agreement between the company's management and the union. But it seems you're saying the company had no say in the matter? I know I've never had a pension anywhere I worked. Please explain.

by eds 17y ago

olefoo 17y ago

You do not understand a very basic fact about pensions; namely that they are an obligation that the company has. Your statement makes as much sense as saying that the company is in financial trouble because they have paid loans back in years past. For the company to default on the pensions that they owe is just as bad if not worse as if they were to default on their line of credit with a bank.

mattmcknight 17y ago
They shouldn't be an obligation that the company has, that's what makes them suck. They should be separately held funds that can survive beyond the lifetime of the company (like 401k plans). To make them company obligations is to invite disaster. It's analogous to the situation at GM where each current worker covers the health care of 10 other people. If you want a pension plan because you trust and want to pay pension plan administrators to manage your assets, it needs to be a separate financial entity from the company itself.
- olefoo 17y ago
  Think of it this way, the fact that it's an obligation is interface; that it was not implemented as a stand-alone fund is the responsibility of the managers. And given what has happened in the financial world in recent years... it's quite possible that stand-alone funds would have been completely wiped out through mismanagement or outright theft.
eds 17y ago
That's interesting, I was under the impression that pensions were an agreement between the company's management and the union. But it seems you're saying the company had no say in the matter? I know I've never had a pension anywhere I worked. Please explain.