“Retirement Heist” shows how they stole the pensions

Retirement Heist: How Companies Plunder and Profit from the Nest Eggs of American Workers
Ellen E. Schultz
Portfolio Hardcover, 2011, 256 pages, $26.95

Retirement Heist, by Wall Street Journal reporter Ellen Schultz, is certainly one of the most important books published in the past few decades.

For the past 30 years, we’ve been inundated with hysterical announcements from the corporations that they faced a “crisis” due to “runaway pension and health care costs.”  These undue burdens were bringing the entire economic system down, they said.  American companies, we were told by a corporate-owned media, just couldn’t compete with “unfair competition,” all because of outrageous “entitlements.”  Ellen Schultz has shown, with meticulous research, how financial institutions and corporations were able to use accounting tricks, rulings by corporate-controlled government oversight bodies, ridiculous tax incentives, deception and outright lies to literally destroy the structure of retirement security that took decades of struggle by America’s working people to put in place.

Three decades ago, prior to Reagan’s “Republican Revolution,” 40 percent of America’s retirees were receiving real, defined benefit pensions that paid a regular negotiated amount each month.  This past year, the results of the attacks on workerss pension rights showed that less than 20 percent of today’s retirees are  still were getting real pensions.

Ellen Schultz shows in Retirement Heist that this catastrophe was anything but a natural result of market forces. It was, in fact, outright theft of legally negotiated pensions that workers had worked their entire lives to earn. These thieves overwhelmingly moved billions of dollars of workers’ pension funds into  obscene compensation packages for executives. Schultz points to new accounting rules implemented by the Financial Accounting Standards Board (FASB) and ERISA (Employee Retirement Income Security Act) Advisory Council in the 1980s and early ’90s as being central to the plans of the corporate gangsters.

Most folks reading this are probably thinking that they’ve never even heard of these bodies.  It is Schultz’s greatest accomplishment that she provides regular working people a peek behind the corporate curtain, finally a chance for us to begin to decipher how this disaster overtook us.  While very well written and in easily understood language, it was a tough read for me because I could only read a few pages before becoming too angry to continue.

Readers will find the arguments used by the wealthy corporate spokesmen of the ’80s and ’90s very familiar, almost prophetic, as they speak of pensions being “over-funded” at that time and how they “could use the pension funds much more efficiently, productively, and would be able to create jobs and make pension plans more secure” if only they could be able to take money from workers’ pension funds for their own uses. We’ve all now seen what the corporations “created” after the ERISA Board allowed them to use workers’ pension money. It wasn’t jobs and it sure as hell didn’t “make pension plans more secure.”  It created poverty, literally wiping out industrial communities. The corporations brought misery and insecurity to the doorstep of millions and helped produce the greatest redistribution of wealth, from working folk to the super rich, in human history. By impoverishing millions, they laid the basis for the massive economic crisis our nation is now in.

Schultz does more than cite dry statistics and government rulings. Peppered throughout the book are stories of real people, like Mark Zellers, Delphi retiree from Columbus, Ohio, who’s now trying to live on $9 a month, and retired pilot Denis Waldron, from Georgia, who saw his pension go from $2,000 to only $95 a month, both after corporate pension thefts.

Wealthy corporate hirelings continue to demand cuts to programs designed to help retirees and others, including Social Security and Medicare.  The corporate media parrots the corporate call to end pensions and “entitlements,” as the way back to prosperity.  But new, frustrated and angry voices are now making themselves heard. The Occupy movement is calling for an end to the new Gilded Age of extreme wealth for a few and increasing poverty for most. Organized labor has built huge coalitions that are successfully fighting off attacks by corporate politicians in Ohio, Wisconsin and elsewhere.  The Alliance for Retired Americans is setting up coalitions to fight for retiree security.

While Schultz does not have a “to do” list for activists fighting to reverse course, she has eloquently shown us all how the thieves did it. After her book, no longer is the massive corporate theft of pensions a mystery – it gives us a place to start the fightback! Retirement Heist is definitely a must-read for anyone concerned with how our nation got into this crisis, anyone trying to find the way out.


Bruce Bostick
Bruce Bostick

Bruce Bostick is a retired steelworker and leader in Ohio Steelworkers Organization of Active Retirees.