imc indymedia

Los Angeles Indymedia : Activist News

white themeblack themered themetheme help
About Us Contact Us Calendar Publish RSS
latest news
best of news




A-Infos Radio

Indymedia On Air

Dope-X-Resistance-LA List


IMC Network:

Original Cities africa: ambazonia canarias estrecho / madiaq kenya nigeria south africa canada: hamilton london, ontario maritimes montreal ontario ottawa quebec thunder bay vancouver victoria windsor winnipeg east asia: burma jakarta japan korea manila qc europe: abruzzo alacant andorra antwerpen armenia athens austria barcelona belarus belgium belgrade bristol brussels bulgaria calabria croatia cyprus emilia-romagna estrecho / madiaq euskal herria galiza germany grenoble hungary ireland istanbul italy la plana liege liguria lille linksunten lombardia london madrid malta marseille nantes napoli netherlands nice northern england norway oost-vlaanderen paris/Île-de-france patras piemonte poland portugal roma romania russia saint-petersburg scotland sverige switzerland thessaloniki torun toscana toulouse ukraine united kingdom valencia latin america: argentina bolivia chiapas chile chile sur cmi brasil colombia ecuador mexico peru puerto rico qollasuyu rosario santiago tijuana uruguay valparaiso venezuela venezuela oceania: adelaide aotearoa brisbane burma darwin jakarta manila melbourne perth qc sydney south asia: india mumbai united states: arizona arkansas asheville atlanta austin baltimore big muddy binghamton boston buffalo charlottesville chicago cleveland colorado columbus dc hawaii houston hudson mohawk kansas city la madison maine miami michigan milwaukee minneapolis/st. paul new hampshire new jersey new mexico new orleans north carolina north texas nyc oklahoma philadelphia pittsburgh portland richmond rochester rogue valley saint louis san diego san francisco san francisco bay area santa barbara santa cruz, ca sarasota seattle tampa bay tennessee urbana-champaign vermont western mass worcester west asia: armenia beirut israel palestine process: fbi/legal updates mailing lists process & imc docs tech volunteer projects: print radio satellite tv video regions: oceania united states topics: biotech

Surviving Cities africa: canada: quebec east asia: japan europe: athens barcelona belgium bristol brussels cyprus germany grenoble ireland istanbul lille linksunten nantes netherlands norway portugal united kingdom latin america: argentina cmi brasil rosario oceania: aotearoa united states: austin big muddy binghamton boston chicago columbus la michigan nyc portland rochester saint louis san diego san francisco bay area santa cruz, ca tennessee urbana-champaign worcester west asia: palestine process: fbi/legal updates process & imc docs projects: radio satellite tv
printable version - js reader version - view hidden posts - tags and related articles

You be the judge: Is Renco robbing steelworker pensions?

by Milt Neidenberg Saturday, Feb. 25, 2006 at 11:01 AM

The Renco Group, Inc., is threatening legal action against Workers World newspaper. Its owner is Ira C. Rennert, a billion aire speculator who deals in selling and buying companies, many in bankruptcy. Rennert is one of a growing breed of predators feeding off distressed companies.

You be the judge

Is Renco robbing steelworker pensions?

By Milt Neidenberg

Published Feb 23, 2006 12:10 AM

The Renco Group, Inc., is threatening legal action against Workers World newspaper. Its owner is Ira C. Rennert, a billion aire speculator who deals in selling and buying companies, many in bankruptcy. Rennert is one of a growing breed of predators feeding off distressed companies.

They suck out the assets—pensions and other equities built up by the sweat and blood of the workers—and dump them when it is most profitable. Rennert has built an empire of massive holdings in real estate, mining and metal industries, including one in Peru.

One of his buyouts was WCI Steel, a plant of some 2,200 workers and retirees in Warren, Ohio, on the edge of the Rust Belt. Renco Group bought out bankrupt WCI in 1988. Following an unsuccessful attempt to break the steelworkers’ union there in a bitter strike in 1995, Rennert agreed to create a new pension plan, the old plan having been wiped out in the previous bankruptcy.

It was a short-lived victory for the steelworkers. WCI again declared Chapter 11 bankruptcy in September 2003. Accord ing to the Ohio Beacon Journal of Feb. 7, “The pension fund of WCI Steel Inc. is about 7 million short of its obligations.”

Renco has retained Arnold & Porter LLP, a global powerhouse of 650 lawyers with legions of powerful Fortune 500 clients. A letter from the firm claims a Feb. 14 WW article about Renco was “false and defamatory.” Headlined, “WCI steel bankruptcy robs workers’ pensions,” the WW article backs up the claim that “after robbing the pension fund, Renco now claims it can cover the fund’s shortfall.”

According to the letter from Arnold & Porter, Renco never robbed the pension fund and WW must “withdraw the current version of the article from its website and should not reprint it in any future issue of the print edition....” It demands that WW “apologize to the Renco Group and its officers, directors, employees and shareholders” or face legal action.

WW editor Deirdre Griswold says, “The paper is standing by the article unconditionally and refuses to accept Arnold & Porter’s ultimatum. The article accurately described their client as robbing the pension funds.”

Robbing pension funds comes in different forms and Renco is no exception.

According to the Pension Benefit Guarantee Corp. (PBGC), a government agency tasked with protecting workers’ pensions, the Employment Retirement Income Security Act of 1974 guarantees that “companies that make pension promises are obligated to pay for those pension promises.” The PBGC “filed a lawsuit to seize the pension plan of the bankrupt WCI Steel, saying that the plan was more than 0 million short of the amount needed and that the government believed WCI’s corporate parent, the Renco Group, should be held responsible for the money. ... The steelworkers could risk losing about million worth of benefits.” (New York Times, Feb. 3) In plain words, the company had robbed the pension fund.

The facts are indisputable. Renco has now admitted to the bankruptcy court that WCI’s corporate family had the means to make the pension plan whole. “The Renco Group, its attorneys acknowledged, has enough money to cover the pension obligations.” (Ohio Beacon Journal, Feb. 7)

Capitalist vultures at war

Currently a bitter struggle is going on between Renco and a group of Wall Street financiers over ownership and who is responsible for the 7 million under-funded pension liability. These secured creditors, who financed the company during the bankruptcy, have created a shell company. If they win ownership, they will demand that the 0 million currently in the pension fund be transferred to their company.

These bankers could win the ownership and the pension fund, and Renco could lose the company. Billionaire speculator Rennert would be held liable for the 7 million obligation and stand to lose a bundle.

The stakes are substantial. Is this why Workers World, which unraveled this tangled tale, is now being threatened?

Nevertheless, one fact stands out beyond dispute. The pension funds are the legal property of the steelworkers, who worked hard and long in a dangerous and difficult environment to secure a measure of security for their senior years.

Symptom of huge pension crisis

The giant wave of cutbacks, freezing and defaulting on pension contributions by U.S. corporations is a disaster of monu mental proportions. Currently, the shortfall in pension plans is estimated to add up to around 0 billion in the private sector and around 0 billion in the public sector.

The Employee Benefit Research Insti tute, a nonprofit organization, says 42.4 percent of workers in the private sector over the age of 21 lack any retirement coverage. It calculates that over 48 million workers, or 45 percent of the workforce, have no pension benefit or retirement savings plan.

IBM announced last month that it plans to freeze its pension fund covering 125,000 workers in 2008. Alcoa, NCR, Verizon, Hewlett-Packard, Motorola and Sears have set up their own plans to deal with their underfunded pensions. Many are converting them to 401-k savings plans, which are speculative at best and a risky nest egg for workers reaching retirement age.

Bankruptcies are in vogue. The pension crisis accompanying the WCI bankruptcy is only the tip of the iceberg. About 150 corporations are in some stage of bankruptcy reorganization. United Airlines, Delta, Northwest and Bethlehem Steel have used the bankruptcy court to dump their pension obligations.

The surge in bankruptcies comes at a time when Wall Street and corporate America are boasting about capitalist expansion and growth. What will happen when the capitalist economy slows down? How many more companies will file for bankruptcy, lay off the workforce and end their legacy costs, such as pensions and health benefits?

The global auto parts giant Delphi is a special case. If the bankruptcy court allows this company to terminate its pension liability, that would amount to a default worth between billion and billion, according to the PBGC. This government agency is now underfunded by .3 billion because of previous bankruptcies and can provide only a dwindling percentage of the defined pension benefits that workers should be entitled to.

Bankruptcy and workers’ control: an idea whose time has come

In bankruptcies, ownership is up for grabs. When a company files for bankruptcy, it is no longer the legal owner. It surrenders the title. The company becomes a debtor no longer in possession of the property. It is vulnerable to creditors, particularly the multinational rank-and-file organized workforce, who have equity—their pensions and other contractual benefits. This entitles them to be the principal creditors of the distressed companies. They create the value through their labor power that keeps the operations running. Just such a struggle is going on in Delphi.

The United Auto Workers must prepare for battle as representatives of the Delphi workers. Delphi has money—.6 billion in cash—but Citigroup and JPMorgan Chase, as the “debtor in possession” lenders, will claim this money after the PBGC absorbs the pension default. Representing the Delphi workers, the union must assert its right to be the trustee to run the company and therefore the de facto owner on behalf of the workers. Taking possession of the plant and equipment has to be planned and organized to assure the contracts are honored and pensions, health care and jobs are secured.

It must be explained over and over that occupation is a legal right, but a right that will only be recognized through struggle. That’s the way it was done in the 1930s, when General Motors workers took over the plants in the famed “sit-ins” and the UAW was born.

Pensions, health care and jobs are a property right. Only under workers’ control can they be guaranteed. That’s the lesson of the WCI/Renco struggle.

This article is copyright under a Creative Commons License.

Workers World, 55 W. 17 St., NY, NY 10011



Support independent news

Report this post as:

Local News

Change Links September 2018 posted S02 10:22PM

More Scandals Rock Southern California Nuke Plant San Onofre A30 11:09PM

Site Outage Friday A30 3:49PM

Change Links August 2018 A14 1:56AM

Setback for Developer of SC Farm Land A12 11:09PM

More problems at Shutdown San Onofre Nuke J29 10:40PM

Change Links 2018 July posted J09 8:27PM

More Pix: "Families Belong Together," Pasadena J02 7:16PM

"Families Belong Together" March, Pasadena J02 7:08PM

Short Report on the Families Belong Together Protest in Los Angeles J30 11:26PM

Summer 2018 National Immigrant Solidarity Network News Alert! J11 6:58AM

Watch the Debate: Excluded Candidates for Governor of California M31 5:20AM

Change Links June 2018 posted M28 7:41AM

The Montrose Peace Vigil at 12 Years M22 8:01PM

Unity Archive Project M21 9:42AM

Dianne Feinstein's Promotion of War, Secret Animal Abuse, Military Profiteering, Censorshi M17 10:22PM

CA Senate Bill 1303 would require an independent coroner rather than being part of police M10 9:08PM

Three years after OC snitch scandal, no charges filed against sheriffs deputies M10 8:57PM

California police agencies violate Brown Act (open meetings) M02 8:31PM

Insane Company Wants To Send Nuke Plant Waste To New Mexico A29 11:47PM

Change Links May 2018 A27 8:40AM

Worker-Owned Car Wash on Vermont Closed A27 5:37AM


lausd whistle blower A11 6:58AM

Website Upgrade A10 10:02AM

Help KCET and UCLA identify 60s-70s Chicano images A04 8:02PM

UCLA Luskin: Casting Youth Justice in a Different Light A02 6:58PM

Change Links April 2018 A01 6:27PM

More Local News...

Other/Breaking News

Paraphysique de psychosomatique S22 6:58AM

Chuck Grassley: Women Abusing, Animal Murdering, Illegal War Supporting Criminal S22 2:58AM

Finance Capitalism and the Digital Economy S21 4:45PM

Muselières syndicales, muselières patronales S21 7:19AM

Jeff Bezos, Amazon, The Washington Post, Whole Foods, Etc S21 2:50AM

Why Choose Nut Milk Over Cows' Milk S21 1:01AM

Antrhopocène, le grand effondrement S19 9:53AM

Abolir l'économie S18 11:18AM

The Dictatorship of Corporations S17 5:26PM

18 Lethal Consequences Of Hunting S17 3:13PM

Paraphysique de l'outplacement déontologue S15 6:51AM

Shopping du bashing S14 8:42AM

After Lehman Brothers, Experts Say Global Financial Crisis Can Happen Again S13 8:28PM

“Animaniacs in Concert!” Starring Voice Legend Rob Paulsen S12 9:30PM

Probabilités de fin d'humanité S12 6:49AM

Florida Area of Migrant Farmworkers Denied Right to Construct Health Clinic near NaplesCIW S11 2:57AM

Steer clear of work morality! S09 12:10PM

The Shortwave Report 09/07/18 Listen Globally! S06 11:23PM

August 2018 Honduras Coup update S06 12:28PM

Brett Kavanaugh Filled The 5th Circuit With Execution Judges S06 6:14AM

Augusta Georgia Woman Gets 5 Year Prison Sentence for Writing About Russians Crime Acts S05 8:29AM

Paraphysique de contextualité S05 8:29AM

Crisis Regulation in Global Capitalism S03 3:39PM

Ex-voto de réification S03 10:24AM

Please Oppose Warmonger, Execution and Torture Supporting Bush Operative Brett Kavanaugh A31 10:45PM

Paraphysique d'exploitation occultation A31 10:24PM

Ryan Zinke Is Charging Taxpayers For A Trophy Hunters' Council A31 2:10PM

Is the Financial Crash 2.0 Coming? A31 10:07AM

More Breaking News...
© 2000-2018 Los Angeles Independent Media Center. Unless otherwise stated by the author, all content is free for non-commercial reuse, reprint, and rebroadcast, on the net and elsewhere. Opinions are those of the contributors and are not necessarily endorsed by the Los Angeles Independent Media Center. Running sf-active v0.9.4 Disclaimer | Privacy