Employees of American Airlines worked for years on the assumption that they would receive a pension. But that legal obligation may not survive America Airlines’ bankruptcy.


Advertisement


Companies and cities see this as a way out. They can drive a hard bargain with unions. Who do you think unions worry about most? Existing workers or retired workers?

The unions may fight. But how can they win? Once a firm declares bankruptcy, it can tell workers, “Accept our offer or else find a new career.”

The parent of American Airlines wants to eliminate about 13,000 jobs — 15 percent of its workforce — as the nation’s third-biggest airline remakes itself under bankruptcy protection.

The company proposes to end its traditional pension plans, a move strongly opposed by the airline’s unions and the U.S. pension-insurance agency, and to stop paying for retiree health benefits.

Read More at the Tea Party Economist By Gary North, Tea Party Economist


Don't Miss Out. Subscribe By Email Or Facebook

Email

Facebook