Some posts from another airline's pilot forum:
The only legacy carrier retirement that has a chance in the long term is American’s because they have made an effort to face the music. If I were close to retirement at DL, NWA, etc. I’d take a lump sum and run --- and apparently they are. If they delay the day of reckoning they guarantee a result like US Air’s.
Remember about 20 years ago when companies like UAL were taking “excess†funds out of their retirement accounts?
The airlines are only the tip of the iceberg, however, and the taxpayer will end up on the hook. Auto, steel, textiles, etc. etc.
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This has split the ranks within ALPA itself. Part of the change in the core rate will by default reduce the factor for lump sum payouts by about 25% which can be huge at those kinds of dollars.
At one hearing they had United and Delta pilots at opposite tables. One problem at Delta that is creating angst is that the retiring pilots are taking advantage of very liberal lump sum provisions and cashing out at a much higher rate than anticipated when the plan provisions were set up. This is causing a near "run" on the cash reserves and has many of the younger guys seething, knowing that the solution to this "problem" will be less attractive provisions when the younger ones retire. Maybe the new legislation will take care of that on its own, but it's going to be generationally devisive.
This is going to be interesting to watch. The PBGC itself is nearly insolvent. While low by traditional legacy carrier A fund standards, the less than 60K per year max on PBGC payouts looks likely to get reduced even further. If that starts impacting retired industrial workers, watch the AFL-CIO start complaining about rich white airline pilots bankrupting the system.
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The smart move at any legacy carrier is to take the money and run. The pilots who did that at US Air are laughing all the way to the bank.
There is a joke I can't remember in detail but it goes something like you have mixed emotions when your mother-in-law jumps off a bridge with all of your money. That's probably how the junior Delta pilots are feeling right now. $700 million charged against shareholder equity in November.
