your incredible vanising pension

your incredible vanising pension - Your Incr edible...

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5/30/13 Your Incredible Vanishing Pension www.fool.com/personal-finance/retirement/2005/07/15/your-incredible-vanishing-pension.aspx 1/2 Your Incredible Vanishing Pension By Rich Smith | More Articles | Save For Later July 15, 2005 | Comments (0) "Bethlehem Steel was a giant. You knew if you worked for a place like that, you were . .. set for life." -- Wife of a Bethlehem Steel employee "The human tragedy [of Bethlehem Steel] is not so much the loss of jobs. . .. The human tragedy is the many, many people who were dependent on benefits which they thought were guaranteed." -- Lance Metz, historian, National Canal Museum PBS reran its superb documentary on the history of Bethlehem Steel a few weeks ago. As I was watching, the above comments jumped out at me. The contrast between what workers and retirees believe their future will hold and the awful way it often plays out couldn't be starker. Because when Bethlehem Steel went bankrupt, not only did the company die, not only did workers lose their jobs -- but also retirees who had thought themselves "set for life" found themselves left out in the cold instead. A cautionary tale Bethlehem Steel spanned nearly a century and a half of American history. The company quite literally built the iron bones of our nation. But by the 1990s, the company's own bones had become frail. Wracked by debt and diminished in power by foreign competition, Bethlehem struggled to earn the profits necessary to pay the salaries of its 11,500 workers and the pensions of its 120,000 retirees and their dependents. In 2001, Bethlehem filed for bankruptcy. One year later, it transferred its pension fund and its obligations to the U.S. Pension Benefit Guaranty Corporation (PBGC).
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