Schultz details an array of accounting tricks, tax incentives and other ways that companies manipulate plan benefits to serve corporate purposes other than providing retirement security to their workers. These include everything from financing restructuring plans and mergers to goosing bonuses and performance-based management compensation and funding lavish pensions for top executives. Pension assets, Schultz argues, also have been cannibalized to fund retiree health benefits — which in turn also have been shrunk.
She trains her fire in the book not just on corporate managers, but on the “retirement industry”– mainly the consulting and law firms and others that help companies craft ways to cut benefits. –excerpted from “Retirement Heist” book asks: Who stole America’s pensions?—Mark Miller, Reuters Money, September 14, 2011
A blistering examination of corporate greed and avarice.
Readers are no stranger to the grumblings of their corporate overlords: Pensions are untenable; health-care costs too high; retiree benefits hurt competitiveness. But according to Pulitzer Prize–winning Wall Street Journal reporter Schultz, employee pensions actually make money for corporations, and the funds diverted from them help feather the beds of multi-millionaire executives. She exposes all this and more in a rapid-fire narrative. Individual stories of retired men and women (some with more than 40 years of service) robbed of their nest eggs put a human face on the proceedings. The extent of corporate obfuscation is nearly incalculable, but the author does a stellar job breaking it all down, succeeding where regulators, lawyers and members of Congress have failed. Schultz’s debut is a significant call to action, and ignoring her findings would be inadvisable. Her story of a minivan full of diabetic and cancer patients forced to travel more than 100 miles just to have their day in court should alone be enough to spur new reforms. Schultz unleashes an undeniably powerful and penetrating look into corporate money-making machinations and the havoc inflicted on rank-and-file employees. Essential reading for anyone who works for a living. –Kirkus Reviews, Sept. 1, 2011
“The retirement crisis is no accident, claims Wall Street Journal investigative reporter Schultz; large companies have played a significant role in its creation to protect the wealth of its top executives. When GE, IBM, Verizon, and others slashed pensions and medical benefits for millions of American retirees, they pointed fingers everywhere but at themselves–but who was really at fault? Pension funds were not bleeding the companies of cash. GE hadn’t contributed a cent to the workers’ pension plans since 1987, but still had enough money to cover all current and future retirees. Executive pensions at GE, with a $6 billion obligation, are a drag on earnings. These are largely hidden, however, lumped in with the figures for regular pensions. Schultz’s methodical cataloguing of these abuses paints a highly unflattering picture of companies that cut benefits to boost earnings, lay off older workers who are entering the years in which their pensions will spike, inflate retiree health benefits to boost profits, lobby for laws that keep the system inequitable, hoard death benefits, and fire whistle-blowers. Heartbreaking stories of destitute seniors are juxtaposed with the obscene surpluses in pension funds for executives ($25 billion at GE; $24 billion at Verizon; $20 billion at AT&T)–and unless the global retirement industry is reined in, Schultz points out, it will continue to capture retirement wealth earned by many to enrich a relative few, and within our lifetimes, “retirement” will inevitably revert to what it was in the 1930s and before. A fascinating, troubling exposé and a sobering call to arms.”—Publishers Weekly review
“Ellen Schultz documents the biggest heist in history, all the more horrifying because it is legal. Accounting tricks, perverse tax incentives, and bonus-hungry executives have taken the retirement money American workers have saved over decades. Meticulously researched and as gripping as a crime novel, this is essential reading for anyone who has, had, or hopes to have a job.”—Nell Minow, co-founder of The Corporate Library and author of Watching the Watchers: Corporate Governance for the 21st Century
“Americans have long been burdened by the overwhelming challenge of saving for retirement, as tax deductions for retirement savings favor the highest income earners and pension coverage erodes. But as an economist investigating the retirement crises I was shocked at Ellen Schultz’s exposure of outright lies, manipulations, and pure greed of the employers trusted with our retirement funds. Retirement Heist will help ordinary workers pressure Congress’s to enact serious pension reform.”—Teresa Ghilarducci, Director of the Schwartz Center for Economic Policy Analysis and author of When I’m Sixty-Four: The Plot Against Pensions and the Plan to Save Them
“Retirement Heist takes a provocative look at the unseen corporate forces that have weakened our nation’s employer provided retirement benefits. Ellen E. Schultz documents an emerging corporate culture – spurred on by benefit consultants – that places shareholder value and executive compensation above employee retirement security. Retirement Heist shows how the growing retirement insecurity of today is a direct outgrowth of the hidden manipulation of plan benefits for other corporate purposes.”–David Certner, Legislative Policy Director for AARP
Everyone concerned about the disappearance of the American dream of retirement security should read this important book. Weaving together compelling stories of real people and meticulously researched statistics from government filings, Retirement Heist provides a comprehensive, persuasive, and highly readable explanation of the many ways that corporations boost profits at the expense of retirees’ pension and health benefits. –Karen Ferguson, Director, Pension Rights Center, Washington, D.C.
“Ellen Schultz has been bravely uncovering crimes of the corporate state since well before it was en vogue. Retirement Heist is like an acclaimed artist’s most profound masterpiece – or, more accurately, a horror auteur’s most frightening film of all. Only none of Schultz’s book is fiction – which is unfortunate, because it means America is in way bigger economic trouble than most people think.”–David Sirota, syndicated newspaper columnist, radio host and bestselling author of The Uprising and Back to Our Future
“Retirement Heist uncovers one of the most significant threats to the American worker of our time. Ellen Schultz’s reporting is expansive, smart, and will have you shouting for someone to be held accountable. Anybody who works and is worried about their future should read this book.”—Lewis Maltby, president of the National Workrights Institute and author of Can They Do That? Retaking Our Fundamental Rights in the Workplace
“The retirement security of millions of Americans hasn’t been lost to the recession or the demographics of an aging workforce, it’s been stolen-by corporate executives and their consultants, lobbyists, accountants, and lawyers. Retirement Heist is an important book for workers and policymakers that documents how corporate profits and executives’ salaries have been inflated at the expense of the middle class.”—Jay Feinman, Distinguished Professor, Rutgers University School of Law, Camden and author of Delay, Deny, Defend: Why Insurance Companies Don’t Pay Claims and What You Can Do About It