Is Robert Davis helping or hurting Detroit ?

[Wesley Mouch]

I totally agree with this. In fact, I think it's criminal that corporations can use pension assets to pay operating costs.

Now I'm not a financial planner or CPA, but its not my understanding that corporations can just plunder pensions.

Yes, this was a rigged game. By Corporations and Labor as well. Everyone benefited. But for the most part, everyone followed the law. And frankly, I think everyone believed that it was safe. We were all wrong.

That said, I agree 100% that we need to rethink how we fund retirement.

And while I'm very libertarian in my thinking, CTY's right about people. I am very concerned about what will happen to most of us today who don't have those great pension plans in place. Most people aren't capable of setting aside enough of their retirement. This could well be a future crisis.

[corktownyuppie]

Now I'm not a financial planner or CPA, but its not my understanding that corporations can just plunder pensions.

I was shocked to find this out, but yes...pensions are simply general liabilities of the corporation. There are minimum funding requirements to be covered by PBCG but that minimum number is not 100%.

In my opinion, anyone sitting as trustee of a municipal pension board shoukd not actually be allowed to approve pension investments themselves. Rather, their power should be limited to hiring the professionals with required credentials and maybe even bonding to approve investments. The potential for corruption is through the roof.

[Packman41]

In my opinion, anyone sitting as trustee of a municipal pension board shoukd not actually be allowed to approve pension investments themselves. Rather, their power should be limited to hiring the professionals with required credentials and maybe even bonding to approve investments. The potential for corruption is through the roof.

To Corktownyuppie:

I agree with you that trustees should not vote on individual investments and so does the federal government. There are rules about that.

The Employee Retirement Income Security Act of 1974 [[ERISA) is a federal law that sets minimum standards for most voluntarily established pension and health plans in private industry to provide protection for individuals in these plans.

In the private sector Trustees have to follow ERISA regulations. And those regulations only allow the Trustees to set asset allocations and appoint financial managers. Those managers now have complete discretion in buying and selling investments.

It is different for the public [[taxpayer supported) sector.

Municipal pension funds are specifically exempt from ERISA regulation – the politicians wanted it that way. It allows them to dole out taxpayer money for pet projects while receiving kickbacks and bribes - just ask Monica Conyers and Jeff Beasley.

The Detroit Free Press has been covering the corruption in two city pension funds for the last couple of years and now we are starting to see the indictments.

What’s the loss of $480 million matter when the taxpayers have to pick up the tab when the pension fund trustees are not held responsible? They screw up and lose the money but then we have to pay.

http://www.freep.com/article/2010122...ds-480-million

[Scottathew]

I'm talking about the people who live paycheck to paycheck, can't get control over spending, etc. etc. And while normally am in favor of people paying for the consequences of their poor decision making, the problem is that we ALL pay for the costs of their poor decision making.

Ugh... I know the exact people you're talking about. I'm friends with quite a few. They make enough money to have a comfortable living, but they think 100% short-term and not long term at all.

The friends I have are all good, hard working people. I tried explaining to them that if they lived within their means and didn't use credit cards to finance things that they would actually have much, much more money to spend.

They simply refuse to do what's best for them and will more than likely work until they can collect social security.

[Wesley Mouch]

To Corktownyuppie:

I agree with you that trustees should not vote on individual investments and so does the federal government. There are rules about that.

The Employee Retirement Income Security Act of 1974 [[ERISA) is a federal law that sets minimum standards for most voluntarily established pension and health plans in private industry to provide protection for individuals in these plans.

In the private sector Trustees have to follow ERISA regulations. And those regulations only allow the Trustees to set asset allocations and appoint financial managers. Those managers now have complete discretion in buying and selling investments.

It is different for the public [[taxpayer supported) sector.

Municipal pension funds are specifically exempt from ERISA regulation – the politicians wanted it that way. It allows them to dole out taxpayer money for pet projects while receiving kickbacks and bribes - just ask Monica Conyers and Jeff Beasley.

The Detroit Free Press has been covering the corruption in two city pension funds for the last couple of years and now we are starting to see the indictments.

What’s the loss of $480 million matter when the taxpayers have to pick up the tab when the pension fund trustees are not held responsible? They screw up and lose the money but then we have to pay.

http://www.freep.com/article/2010122...ds-480-million

Wow!

What a great idea! Exempt yourself from responsible behavior. Who benefits the most from this? Management or Labor? Oh, after thinking about it for a second, the answer was clear. Both! What a world!

[Detwa]

[[3 pages later)

Yeah, but - is Robert Davis helping or hurting Detroit? LOL