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Originally Posted by ba1025
I also question whether the non wage compensation is overstated It includes pensions and benefits that companies are going into bankruptcy to avoid paying or re negotiating years after guaranteeing them. Who goes back and adjusts past compensation when that happens. Look at the buyouts at the big three. Those buyouts are paying out considerably LESS than what was originally guaranteed it's just being paid in cash. Is anyone going to make adjustments on previous years based on Delco, American Airlines and soon most likely the big three's shedding of past guarantees of non wage compensation? If it's never going to be paid it isn't really compensation is it?
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I don't know the frequency, but the various federal bureaus do go back and make statistical adjustments. To what extent, I am not sure.
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Originally Posted by ba1025
I also don't have anything but crocodile tears for the big three who have run their business into the ground and scapegoated unions. How come Ford has an underfunded pension yet...
Dec. 31, 1988: Ford's worldwide earnings were $5.3 billion, the highest of any auto company to date.
2000 Ford reports record earnings of $7.2 billion in 1999, more than any other automotive company in history.
PERHAPS THE WORKERS WEREN'T THE ONES SCREWING THE POOCH HERE.. Maybe some of those earnings are non wage compensation guarantees that the workers will never receive? Maybe when Ford was reporting those earnings in 2000 it was just maybe overstating how well funded it's pension fund was? being they were crying it was breaking them a short 5 years later what else could be the case. What will be amazing is if they end up in chapter 11 someday and we the people pay those pensions. Then ALL that non wage compensation goes away.
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What were Ford's earnings in 1989? 1990? 1991? 1992? 1993? 1994? 1995? 1996? 1997? 1998? 2000? 2001? 2002? 2003? 2004? 2004? 2005? 2006?
Are we being very selective about what statistics are being used?
What was the asset vs. liability position of Ford's pension in 1988? 2000? all the other years? Why is Ford's pension fund have more liabilities than assets currently? What is their cash position in relation to the excess liabilities in the pension fund account? What is the expected timeline for the payouts on the pension fund?
Let's look at all the facts, not just highly selective facts. Only then can we draw solid conclusions.
If anything, this discussion about pension funds should motivate folks to push for more 401K plans and some privatization of the Social Security system so that people can manage their own money. However, that being said, pension plans are only a portion of compensation packages, and while I'm sure that there are more examples of potentially troubled pension funds, compare against pool of employees, the impact on compensation statistics would be marginal.
Next, I don't disagree that the big three have made some strategic errors. Some of this can be attributed solely to them (e.g., the decision to supersize vehicles in the early 90s, which put them at risk to rising gas prices), and some of it can be attributed to the inefficiencies created by the union dynamic.