Report: Treasury Behind Delphi Pensions Debacle
The Daily Caller says it has emails that prove that the pensions of 20,000 salaried retirees at Delphi were terminated “solely because those retirees were not members of labor unions.”
The emails, says the conservative website “contradict sworn testimony, in federal court and before Congress, given by several Obama administration figures. They also indicate that the administration misled lawmakers and the courts about the sequence of events surrounding the termination of those non-union pensions, and that administration figures violated federal law.”
In 1994, GM spun off its parts business into Delphi. In 2005, the company went Chapter 11. Later, parts of the business was sold, wound down, or sold back to GM. Says the Daily Caller:
“Twenty thousand of its workers lost nearly their entire pensions when the government bailed out GM. At the same time, Delphi employees who were members of the United Auto Workers union saw their pensions topped off and made whole.”
In sworn testimony, former Treasury official Matthew Feldman and former White House auto czar Ron Bloom, stated that the Pension Benefit Guaranty Corporation (PBGC), and not the administration, “led the effort to terminate the non-union Delphi workers’ pension plan,” the Daily Caller says. “The emails TheDC has obtained show that the Treasury Department, not the independent PBGC, was running the show.”
This will only end when G.M is dismantled! and when I see Harold Ford Jr.,who is now a executive at a major brokerage firm..and who comes from the most corrupt family of politicians Tennessee has ever seen ,being sucked up to by veteran CNBC anchors as the new messiah..Its all but over! Lock and load... Quoting John Lennon: "you say you want a revolution"
Delphi was a separate company from GM for 9 years before they (Delphi) filed for bankruptcy protection in '05. The only connection with GM when they were forced into bankruptcy by the financial crisis of '08 was the "top off" provision in the UAW contract. It is reasonable that Delphi Salaried retirees were handled in a manner consistent with typical bankruptcy proceedings. There is no doubt that the Obama administration worked hard to serve the UAW interests. They rationalized that it would be too hard to deal with the UAW and take too long to negotiate new contracts. There is validity to the argument in that time was of the essence in GM's bankruptcy to avoid a true death spiral. As a GM Salaried retiree, I was certainly pleased that new GM was allowed to continue funding our pension program. The rationalization for that apparently unusual action in GM's own bankruptcy is that dumping all GM salaried retirees on the PBGC would bankrupt that corporation, which in turn is backed up by the U.S. Treasury. Better to get the money from a new GM than from taxpayers, was the argument. The Obama Auto Task Force did keep UAW retirees whole- their retirement health care was already funded by the VEBA a product of the break through 2007 UAW contract- while demanding that Salaried retiree benefits, which had already been frozen in 2006, be slashed another 2/3.
My understanding is that part of the spin-off (really a way for GM to get away from it's integrated model which had become unsustainable), that since a majority the UAW workers had been GM workers for so long, GM was in regards responsible for thier pensions (whatever was done for GM's UAW employees during BK would have to be done for Delphi's UAW employees. The management on the other hand, they became delphi employees and delphi was soley responsible for them.
I know Matt Feldman. When he says in sworn testimony that the PBGC led this, I believe him. And so should you.