Why Unions oppose Bush on Social Security
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Before some C.O.L. chimes in with a smart @zz trolling comment along the lines of "because Bush's plan is wrong" or "because Bush's plan won't work" (neither of which is necessarily a true statement by the way), read the following from The Washington Post's Jeffrey H. Birnbaum. It's quite illuminating in describing why some groups -- especially "big labor" in this case -- are against Bush's "plans".
Headline is linked.
For Labor Unions, Social Security Is A Matter of Clout
By Jeffrey H. Birnbaum
Monday, May 16, 2005; Page E01
Labor unions have left no doubt about their opinion of President Bush's plan to create private accounts as part of Social Security. They hate it. When they aren't sending nasty letters to brokerages that back the proposal, they're staging rallies and news conferences.
The question is, why? Labor leaders say the president's recommendation endangers the retirement of millions of Americans and that they oppose it for the good of all workers. But there's a lot more to their position than that.
Whatever its merits, Bush's Social Security design threatens to undermine one of the few remaining sources of power for the long-faltering labor movement: access to money and the influence it brings. The AFL-CIO and its affiliates are going all-out to kill the president's plan not just out of altruism but also out of a sense of self-preservation.
Union membership has been declining since 1954, when more than a third of the labor force was unionized. Today, that percentage is 12.5 percent; if you take government workers out of the equation, the percentage is a mere 8 percent.
As an antidote to that calamity, unions have been trying to exert themselves not just from the bottom -- by organizing and recruiting new members -- but from the top -- by using their pension funds, which own hundreds of billions of dollars in corporate securities, to compel boards of directors to do what they want.
Unions have been at the forefront of corporate governance initiatives that have restrained executive compensation, required directors to act more independently from management and given shareholders more say in what companies do. Those efforts have put labor on a collision course with business executives more than usual.
Which brings us back to Social Security. The Bush effort would do two things to hurt organized labor.
First, it would speed the demise of the unions' preferred type of pension -- the kind that gives unions the most clout in the corporate world -- called defined-benefit funds. They are for the most part controlled by unions and provide set benefits to their retirees.
In contrast, Bush's private accounts would be defined-contribution funds which, like 401(k) plans, have set contributions but not specific benefits that come out in the end. Defined-benefit plans are already losing adherents. Since 1978, the number of defined-benefit plans has fallen to 26,000 from 128,000. If the president's proposal were to succeed, that trend would probably accelerate and further hobble unions.
Second, Social Security private accounts would flood the markets with money controlled by individuals, not organized labor. That would tend to dilute labor's voting strength on shareholder issues in general.
"Union leaders fear losing the bargaining power they have through their pensions and ultimately fear that the entire union model could become obsolete," concludes John J. Castellani, president of the Business Roundtable, a major corporate lobbying group.
In fairness, corporations would dearly love to see the AFL-CIO stumble on anything having to do with its corporate campaigns. Business groups have for years railed against labor-led proxy battles as costly nuisances if not outright obstacles to higher profits and growth.
... more at linked article (consider yourself highly encouraged to go check out the rest of the article, which continues with a different topic that is equally educational)
Note: Jeffrey Birnbaum writes about the intersection of government and business every other Monday for the Washington Post, his columns are worth the trip to the Post's web site. You can also e-mail him at [email protected].
Just one of a few answers to questions everyone should be asking regarding Social Security and why some groups are so staunchly against the vision that President Bush has laid out (which some people have been wrongly labelling "his plan").
Why are groups like the AARP, the labor unions and several other groups so dead set against the type of proposals that President Bush has set forth for Social Security? For many, they see any shift towards privatization as a complete loss of power and control over the purse strings of the American people. For as long as they are able to directly control, or help control your income in later stages of your life, you will be far more likely to side with them on all issues politic.
I do continue to find it amazing that there are some C.O.L.'s that talk up the plans of people like Rep. Wexler, while continuing to make statements that make absolutely no sense and which horribly underestimate the ability and intelligence of the average U.S. citizen when it comes to growing their own wealth.
There's been statements such as this:
"The trust fund can be increased either by higher taxes ... or by investing ... in things ... will pay a higher return than the treasury obligations the trust fund currently holds.
That statement alone shows that complete arrogance and ignorance of some individuals. In continuing to push for and demand higher taxes, or possibly suggest putting the "trust fund" into things that will provide a higher return than the treasury obligations, we're all sold short on the other alternatives that work so well for those of us lucky enough to participate in 401K plans or in the government's own TSP type plans.
We're lectured at by trolls as if we should pay heed to their telling us that raising the retirement age and taking more in taxes is the answer. Never mind that the idiots doing the lecturing are already retired and living comfortably. They have theirs, screw the rest of us and the promises that were made to us. In the name of protecting those protecting those promises, it's ok to just change the promise a little and demand more years of service from us and pay us less or take more from us to keep paying us the same amounts. How hypocritical and how absolutely and abjectly ignorant.
Again, I suggest checking the motives behind those that are doing the talking. If they can't be honest enough to say it's because they simply wish to bash Bush, and oppose anything he proposes, if they can't be honest enough to admit it's because they want to hold on to their power, then they don't deserve your ears or your eyes. They should be ignored, painted as the trolls they are, and left to cry as the world changes around them and more and more are empowered."
Headline is linked.
For Labor Unions, Social Security Is A Matter of Clout
By Jeffrey H. Birnbaum
Monday, May 16, 2005; Page E01
Labor unions have left no doubt about their opinion of President Bush's plan to create private accounts as part of Social Security. They hate it. When they aren't sending nasty letters to brokerages that back the proposal, they're staging rallies and news conferences.
The question is, why? Labor leaders say the president's recommendation endangers the retirement of millions of Americans and that they oppose it for the good of all workers. But there's a lot more to their position than that.
Whatever its merits, Bush's Social Security design threatens to undermine one of the few remaining sources of power for the long-faltering labor movement: access to money and the influence it brings. The AFL-CIO and its affiliates are going all-out to kill the president's plan not just out of altruism but also out of a sense of self-preservation.
Union membership has been declining since 1954, when more than a third of the labor force was unionized. Today, that percentage is 12.5 percent; if you take government workers out of the equation, the percentage is a mere 8 percent.
As an antidote to that calamity, unions have been trying to exert themselves not just from the bottom -- by organizing and recruiting new members -- but from the top -- by using their pension funds, which own hundreds of billions of dollars in corporate securities, to compel boards of directors to do what they want.
Unions have been at the forefront of corporate governance initiatives that have restrained executive compensation, required directors to act more independently from management and given shareholders more say in what companies do. Those efforts have put labor on a collision course with business executives more than usual.
Which brings us back to Social Security. The Bush effort would do two things to hurt organized labor.
First, it would speed the demise of the unions' preferred type of pension -- the kind that gives unions the most clout in the corporate world -- called defined-benefit funds. They are for the most part controlled by unions and provide set benefits to their retirees.
In contrast, Bush's private accounts would be defined-contribution funds which, like 401(k) plans, have set contributions but not specific benefits that come out in the end. Defined-benefit plans are already losing adherents. Since 1978, the number of defined-benefit plans has fallen to 26,000 from 128,000. If the president's proposal were to succeed, that trend would probably accelerate and further hobble unions.
Second, Social Security private accounts would flood the markets with money controlled by individuals, not organized labor. That would tend to dilute labor's voting strength on shareholder issues in general.
"Union leaders fear losing the bargaining power they have through their pensions and ultimately fear that the entire union model could become obsolete," concludes John J. Castellani, president of the Business Roundtable, a major corporate lobbying group.
In fairness, corporations would dearly love to see the AFL-CIO stumble on anything having to do with its corporate campaigns. Business groups have for years railed against labor-led proxy battles as costly nuisances if not outright obstacles to higher profits and growth.
... more at linked article (consider yourself highly encouraged to go check out the rest of the article, which continues with a different topic that is equally educational)
Note: Jeffrey Birnbaum writes about the intersection of government and business every other Monday for the Washington Post, his columns are worth the trip to the Post's web site. You can also e-mail him at [email protected].
Just one of a few answers to questions everyone should be asking regarding Social Security and why some groups are so staunchly against the vision that President Bush has laid out (which some people have been wrongly labelling "his plan").
Why are groups like the AARP, the labor unions and several other groups so dead set against the type of proposals that President Bush has set forth for Social Security? For many, they see any shift towards privatization as a complete loss of power and control over the purse strings of the American people. For as long as they are able to directly control, or help control your income in later stages of your life, you will be far more likely to side with them on all issues politic.
I do continue to find it amazing that there are some C.O.L.'s that talk up the plans of people like Rep. Wexler, while continuing to make statements that make absolutely no sense and which horribly underestimate the ability and intelligence of the average U.S. citizen when it comes to growing their own wealth.
There's been statements such as this:
"The trust fund can be increased either by higher taxes ... or by investing ... in things ... will pay a higher return than the treasury obligations the trust fund currently holds.
That statement alone shows that complete arrogance and ignorance of some individuals. In continuing to push for and demand higher taxes, or possibly suggest putting the "trust fund" into things that will provide a higher return than the treasury obligations, we're all sold short on the other alternatives that work so well for those of us lucky enough to participate in 401K plans or in the government's own TSP type plans.
We're lectured at by trolls as if we should pay heed to their telling us that raising the retirement age and taking more in taxes is the answer. Never mind that the idiots doing the lecturing are already retired and living comfortably. They have theirs, screw the rest of us and the promises that were made to us. In the name of protecting those protecting those promises, it's ok to just change the promise a little and demand more years of service from us and pay us less or take more from us to keep paying us the same amounts. How hypocritical and how absolutely and abjectly ignorant.
Again, I suggest checking the motives behind those that are doing the talking. If they can't be honest enough to say it's because they simply wish to bash Bush, and oppose anything he proposes, if they can't be honest enough to admit it's because they want to hold on to their power, then they don't deserve your ears or your eyes. They should be ignored, painted as the trolls they are, and left to cry as the world changes around them and more and more are empowered."