That statement was made by Charles Erwin Wilson, former President of General Motors, during a U.S. Senate committee’s confirmation hearing in 1953 on his nomination for Secretary of Defense. Mr. Wilson could never have imagined that GM executives in 2012 would take action to eliminate the defined benefit pension for its salaried retirees.

Congress passed the Employee Retirement Income Security Act (ERISA) in 1974 which included the creation of the Pension Benefit Guaranty Corporation (PBGC) to encourage the continuation and maintenance of private-sector defined benefit pension plans. For 38 years responsible U.S. companies funded their pension plans and only a relative few, mostly those who went bankrupt, were forced into an involuntary termination of their pension plans.

GM is washing its hands of its defined benefit pension plan for salaried retirees, and has offered a lump sum pension plan buyout to selected salaried retirees. Those who do not take the lump sum offer and other salaried retirees will have a Prudential annuity purchased by GM. This places financial risks on the salaried retirees and that is certainly not good for them or our country’s economy. Although GM’s action is legal, it is not morally and ethically right to break the promise to salaried retirees.

The action by General Motors this month to voluntarily eliminate its defined benefit pension plan does away with the federal law protections for salaried retirees’ lifetime pension payments and balances GM’s books on the backs of retirees. Ford has offered a lump sum buyout to 95,000 retirees and announced that retirees could take it or retain their current pension – they did not terminate the plan. Chrysler’s Chairman announced last week that Chrysler has no intention of offering a buyout or terminating its pension plan. Did GM management take the low road? Were they also dispassionate about helping Delphi retirees? Should GM retiree club members feel used and betrayed?

The NRLN Staff has been working with General Motors Retiree Association Board Members to create a message to GMRA members about GM’s action and a protest letter to GM’s top executive. Click here to read the letter to Daniel F. Akerson, GM Chairman and Chief Executive Officer.  If you encounter a problem with this link to the letter, go to www.nrln.org and click on the link at the end of the NRLN President’s Forum message.

Bill Kadereit, President
National Retiree Legislative Network