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Detroit city workers fight to save pensions

By Cheryl LaBash

Hundreds of people packed the Detroit City County Building auditorium Jan. 8 for yet another Common Council hearing on proposals to take away city employees' lifetime pension benefits.

Although the ordinance affects only
political appointees, elected officials and non-union workers, many of those testifying called it a foot in the door to privatize the entire city pension plan.

Under the plan, workers, instead of receiving a full pension benefit, would be individually responsible for investing a "defined contribution" from the City. No benefits would be guaranteed.

The Common Council defeated a similar proposal in October. The administration of Mayor Dennis Archer originally wanted to privatize the entire pension system for all city workers, but the municipal unions checked that move.

In a memorandum of understanding, the city agreed not to push the issue in union negotiations until 2004. Determined to chip away at the existing pension plan, though, the administration pared down, altered, revised and resubmitted the proposal.

Scores of mayoral appointees, aides, department heads and supervisors were mobilized to speak for the new plan on city time at the hearing. Workers were not given the right to testify during work time.

But retiree after retiree defended the pension system.

This attack on pension benefits is not an isolated, local initiative. UAW Local 2334 President David Sole said that big-business pressure to get rid of defined-benefit pension plans is massive and widespread. The Wheeling-Pittsburgh steel workers recently ended a 10-month strike that focused on just this issue-the company's attempt to impose a defined-contribution system that in effect does away with guaranteed pension benefits to retirees.

"We know the banks and corporate giants are eager to grab up the fat pension funds that are now publicly administered," Sole said. His local represents city chemists.

Sole also exposed how the Heritage Foundation, a racist, right-wing think tank, is involved. He called for a Common Council investigation into its influence on elected officials, saying: "Just two weeks ago Mayor Archer announced that he was being strongly pressured by the Heritage Foundation to privatize city services.

"The Heritage Foundation web site has page after page singing the glories of privatized pensions and defined contribution. They are pushing not only state and local pension privatization, but even want to privatize the Social Security fund.

"The Heritage Foundation is viciously anti-union and against affirmative action and occupational health and safety."

Boon to Wall Street

Who benefits from getting rid of guaranteed pensions and replacing them with "investments"? The real winners are the employers, state and city governments included.

No longer are they required to pay a set pension amount for the life of each worker. After the employer makes the so-called defined contribution, the cost of administering the retirement plan and all the risk and responsibility for future retirement income are transferred to the individual worker.

The individual worker has no guarantees and the corporation has no future economic responsibilities.

Did Wall Street investment bank ers demand that the city privatize pensions to improve its Standard and Poor's and Moody's bond ratings? Or did they just suggest that eliminating pension liabilities would be a plus?

The Common Council vote on this ordinance has not been scheduled. Four "nays" will defeat this attack. But it will take the involvement and struggle of the ranks of city workers to secure and strengthen their right to guaranteed lifetime retirement income.

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