links for 2010-09-17
Something No Human Has Ever Seen Before

Dean Baker Watches as the Washington Post Wages Class War--Against the Dangerous Classes that Make Up the Bottom 90%

There ought to be resignations in disgust and on principle from the Washington Post today. But, then, there should be resignations in disgust and on principle from the Washington Post every day, shouldn't there?

Dean Baker turns my breakfast of leftover kung pao tofu (with what some might call an excess of poblano peppers) into gall in my mouth by sending me this:

Was politics behind the government's decision to preserve the UAW's pensions?: The story of GM's relationship with Delphi, which made powertrain, safety and other technologies, is a convoluted one. In short, GM spun off the company in 1999, and it later went bankrupt. As is usual in such situations, the federal Pension Benefit Guaranty Corp. (PBGC) eventually took over Delphi's underfunded pension funds, paying its beneficiaries pennies on the dollar. But the UAW... had negotiated a prior agreement under which GM agreed to "top off" members' pensions if an independent Delphi ever went bust. Honoring this commitment added $2.1 billion to the GM pension plan's deficit in the fall of 2008, a time when GM, too, was rapidly going down the tubes.

The Obama administration's auto task force decided taxpayers couldn't afford to give Delphi's white-collar workers any more than the reduced benefits to which they were legally entitled. In contrast, the task force concluded that GM's commitment to the UAW was legally binding on a taxpayer-owned post-bankruptcy GM -- just as binding as its other pension obligations, which the task force had agreed to leave untouched. This is plausible, legally. But why did the administration make pension obligations to the UAW sacrosanct in the first place?...

Ummm... The U.S. government has made money on the GM bailout. Unless you think that the purpose of U.S. government crisis interventions is to make as much money for the Treasury as possible--a theory I have never heard anyone advocate--I do not see the rationale for having the government break GM's contract with the Delphi UAW members.

In fact, there is no such rationale--other than that UAW members are unlikely to be invited to Ms. Weymouth's house to listen to Lori Montgomery dish the inside dirt on health care reform--and so don't really count.

Why oh why can't we have a better press corps?