Mikey:
Instead of worrying so much about union leadership, you and your elitist pals on this board ought to be worrying more about Trent Lott and his gang of corporate-minded GOP stooges in the United States Senate. Once again, Senate Republicans are trying to sneak through legislation that would take millions ... nay, billions ... of dollars from working men and working women in this country and deliver it to Big Business, so fat cats making $1 million a year will be able to double their salaries and buy bigger Cadillacs.
The following article is from this weekend's WSJ. Let's headline the article "Reason No. 1000 why every working man and working woman in this country should vote Democratic this fall":
Fidelity Urges Its Investors
To Lobby Retirement Plan
By JOHN HECHINGER
Staff Reporter of THE WALL STREET JOURNAL
BOSTON -- Fidelity Investments is waging an unusual Internet campaign to turn its 16 million customers into amateur Washington lobbyists for a retirement-savings package pending in Congress.
But there's something Fidelity isn't telling its customers: Some of them could actually be hurt by obscure provisions recently added to the Senate version of the package.
In its campaign, Fidelity is touting some politically popular elements of the proposed legislation: allowing people to save $5,000 annually in their Individual Retirement Accounts, up from $2,000 currently, and raising the annual maximum contribution to a 401(k) plan to $15,000, from $10,500.
Since Aug. 31, Fidelity's home Web page, under a prominent headline that reads "Help Congress improve your retirement," has urged investors to e-mail Congress in support of the measure. The "Retirement Alert" page at the Fidelity.com Web site (www100.fidelity.com1) gives customers a direct link to the Securities Industry Association's Web site, which contains a convenient form letter people can immediately e-mail to their Senators in support of the measure.
The form letter calls the legislation "crucial to helping U.S. workers maintain their standard of living after they retire." On its Web site, Fidelity urges customers to "Act Today."
Not so fast, critics say. Some employee and consumer advocates, including AARP, formerly known as the American Association of Retired Persons, argue that some middle-aged Fidelity customers unwittingly could be supporting legislation that would make it easier for their employers to cut their pension benefits.
The disputed provisions are part of a Senate version of the retirement bill, which could come before the full Senate within a week. The items could protect companies from legal challenges if they switch to so-called "cash balance" pension plans, employee advocates say. Over the past 18 months, this type of plan has come under increasing fire because it generally reduces the pensions of older workers compared with what they would have received under traditional plans. Traditional pension plans are structured so employees earn as much as half their ultimate benefits in their last five to 10 years on the job. Under cash-balance plans, workers build up benefits at a steady rate during their years of employment.
Cash-balance plans are under assault in the courts and before the Equal Employment Opportunities Commission, as opponents have sought to challenge the plans under antidiscrimination statutes and other federal laws.
The Senate version of the bill "is likely to have a devastating effect over the long run" for some older workers, says Karen Ferguson, director of the Pension Rights Center, a nonprofit consumer advocacy group in Washington.
Ms. Ferguson says some Fidelity customers who have been in their jobs for many years could be seriously hurt by those cash-balance provisions -- and that the potential harm far outweighs benefits including higher IRA and 401(k) limits.
People in this position who follow Fidelity's advice to lobby Congress, she adds, could be encouraging legislation that would cost them "the mainstay of their retirement income."
James Delaplane of the Association of Private Pension and Welfare Plans, an employer group, says opponents have misconstrued the impact of the Senate legislation. The many workers who change jobs frequently during their careers, he says, end up with fatter pensions under cash-balance plans.
Fidelity spokesman Vincent Loporchio says the company isn't focused on the cash-balance controversy and has no position on that issue. He also says Fidelity began rallying customers on its Web site before the cash-balance provisions were added and is only trying to support the increased retirement-savings elements.
"This legislation is good news for millions of workers," Mr. Loporchio says. "That's why it has such strong bipartisan support." Mr. Loporchio also points out that the Fidelity Web site contains hyperlinks that give consumers access to summaries and the complete bill so that they can learn about other provisions. |
