Human Toll of a Pension Default
WP
Ellen Saracini lost her husband, United Airlines Capt. Victor J. Saracini, when his Flight 175 crashed into the World Trade Center on Sept. 11, 2001. Now she stands to lose more than half of her widow’s pension in a very different kind of crash — United’s default of its $9 billion pension obligations.
The scale of the default, the largest in U.S. history, has received more attention than the toll on the lives of the bankrupt airline’s 120,000 employees and pensioners. Saracini discussed its impact on her and her two daughters in an interview yesterday, saying she hopes her story will help shift the focus to the laws and policies that allow such defaults.
“My own situation is not a crisis — I have my husband’s life insurance to keep us secure in our house,” she said from her home in Yardley, Pa. “But a lot of other people have real hardship — medical costs they won’t be able to afford, houses they won’t be able to keep. If I can help draw attention to them, I’ll do it in a heartbeat.”
Saracini was among about 2,000 United pensioners and employees who e-mailed their stories to Rep. George Miller (D-Calif.) in recent days for what he called an online hearing on the human impact of the default. “We have been overwhelmed — both numerically and emotionally — by the response,” said Miller, one of several politicians in both parties warning that a wider crisis will loom if the nation’s pension security laws are not revised.
More than 20 other companies have defaulted on pension funds of more than $100 million in the past three years, and last week, executives of troubled Delta and Northwest airlines said they may be next. Miller has proposed a six-month moratorium on defaults, as Congress debates how to fix what many lawmakers call “broken” pension protection laws.
“Like Enron, workers’ lives and retirements have been ruined,” Sen. Charles E. Grassley (R-Iowa) said last week. “But unfortunately, this time it’s perfectly legal.”
June 14, 2005 - 03:03 AM on June 14th, 2005
June 14, 2005 - 07:07 AM on June 14th, 2005
1- Hang on a second here. Where is the unions in all of this Fred. The only mention I saw of the union was the comment not to speak to the press. Didn’t these people all put money into their union? Where is their union when they need them? The unions have hundreds of millions in surplus.
June 15, 2005 - 12:41 AM on June 15th, 2005
Human Toll of a Pension Default
The United pension fund default has some human faces here:…