Corporate Takeover: Retirement

A recent article in Salon, “Exposed: Enron billionaire’s diabolical plot to loot worker’s pensions,” highlights a report from the Pew Charitable Trusts in May 2013 about the lack of retirement savings and “the real possibility of downward mobility in retirement.” This is a story that has been gaining steam for some time now, with the recognition that savings levels are way below where they should be to sustain lifestyles into retirement along with the false apocalyptic visions of the imminent collapse of Social Security.

Since the 80s and conservative revolution began, the GOP has been ceaselessly attacking labor and unions to and decrease labor costs and thus increase corporate profits. As I’ve mentioned endless times on this blog, this attack has worked with arguably the single largest transfer of wealth from the poor and middle class to rich in history. Yet is the battle against labor about wages and income alone? Certainly not. Among the other elements of this multi-front attack are increasing the burden of healthcare coverage, reducing job security, increasing debt ratios, undermining worker safety laws and, of course, transferring the responsibility of retirement from business to individuals.

This strategy began in the 80s with the shift from defined benefit to defined contribution plans like 401(k)s and 403(b)s. These plans were sold as providing employees with more freedom in moving from one job to the next and more control over their own money. But what was not said was that the cost of retirement, and the risks associated with investment, were also being passed on from employers to employees. Now they want to go a step further and end Social Security as we know it in the long run and cut public employee pensions in the short run.

And leading this effort to cut state pensions is an odd and troubling collaboration, between Enron billionaire John Arnold and Pew – the same organization warning us about the peril facing future retirees. For over two years, this nefarious partnership has helped push retirement benefit cuts (to varying degrees of success) in California, Florida, Rhode Island, Kansas, Arizona, Kentucky and Montana. They issue joint reports and conduct joint legislative briefings essentially pushing to privatize these accounts, cut overall funding and, of course, enrich Wall Street hedge fund managers.

What is surprising is how partnerships like this are allowed to form and generally go unreported. Pew’s mission is, among other things, in “laying the foundation for effective governments solutions” while the Arnold Foundation appears to be to continue to do the “work” he did at Enron – destroying the pensions of his workers, undermining public sector pensions to the tune of $1.5 billion (as Enron’s share price fell and then collapsed) and enriching himself in the process. It is yet another example of corporate and public sphere power working together to enrich the few at the expense of the many and should remind all of us to be vigilant in the face of statistics and the opinions of experts who claim to support our interests. Particularly as our futures literally depend on it!