The following is an excerpt from Retirement Heist: How Companies Plunder and Profit From the Nest Eggs of Americans Workers, by Ellen E. Schultz by arrangement with Portfolio, a member of Penguin Group (USA), Inc., Copyright (c) Ellen E. Schultz, 2011.
In December 2010, General Electric held its Annual Outlook Investor Meeting at Rockefeller Center in New York City. At the meeting, chief executive Jeffrey Immelt stood on the Saturday Night Live stage and gave the gathered analysts and shareholders a rundown on the global conglomerate’s health. But in contrast to the iconic comedy show that is filmed at Rock Center each week, Immelt’s tone was solemn. Like many other CEOs at large companies, Immelt pointed out that his firm’s pension plan was an ongoing problem. The “pension has been a drag for a decade,” he said, and it would cause the company to lose 13 cents per share the next year. Regretfully, to rein in costs, GE was going to close the pension plan to new employees.