GE’s pension funding met statutory requirements. Why were they still underfunded? Published by Jane the Actuary View all posts by Jane the Actuary
9 thoughts on “Forbes post, “So Why Are GE’s Pensions So Underfunded, Anyway?””
Jane, any idea which politician(s) pushed pension relief into MAP-21?
I don’t think it was any one politician. There was widespread support. The very label “relief” indicates that there was a sense that rates were dropping unusually — and temporarily — low and employers needed some legislative changes as a bridge to a future with a return to higher/”normal” rates. Of course, it’s increasingly looking like these low rates are the “new normal.”
What about all the company stock buy backs by Immelt instead of funding the pension? Immelt did this to prop up stock price for his bonus metrics, stealing from US workers.
The obsessive, negative, and usually misleading, “reporting” on GE continues…
Larry Culp could walk on water, and these dozen or so media outlets would report breathlessly that Culp cannot swim.
Same media that obediently quote every utterance from Harry Markoplolis as irrefutable fact. But never, ever, correcting their reports once he’s proven often nonsensically, wrong.
Incredible that people get paid for this rubbish.
What happens to the pension if GE goes bankrupt?
That’s simple, the PBGC takes over. Only people with the highest levels of accrued pension are affected.
Nothing — or, well, very little, as all but the highest earners will have their pensions (based on actual, not projected-to-retirement pay and service) protected in full by the PBGC, the Pension Benefit Guaranty Corporation. What’s more, you may have heard about the pending insolvency of the PBGC, but that’s with respect to the multi-employer pension fund, which is wholly separate. The single-employer fund is on very firm footing.