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Keep Social Security
Intact, March 13, 2002 Portland General Electric worker Dary Ebrights plans for retirement in 2003 were cut short on a dark day last October. With a 401(k) retirement portfolio chock full of Enron shares, the stock price was plummeting and he was locked out of his account. Only weeks later, when his savings were depleted to pennies on the dollar could he stanch the losses. By then, it was too late. More than $700,000 in losses later, Ebright came to Washington March 5 to share his painful lesson with legislators, and to make a plea: produce meaningful pension reform and keep Social Security intact as a guaranteed retirement benefit. "My hope is that somebody will listen," Ebright told members of the House Ways and Means Subcommittee on Oversight. "Social Security is the only thing left for some of my retired friends who lost everything else."
What Ebright considered more than enough to assure a comfortable retirement is gone, but the 54-year-old considers himself lucky to have a pension and a job. Ebright urged legislators to adopt legislation that assures employee-investors independent advice and also recommended limiting the allowable investment in one company to 20 percent. Sixty-five percent of his 401(k) contribution was in Enron stock, he said. Ebright and Rep. Robert Matsui (D-California) met privately to discuss the danger of Social Security privatization, a dramatic move being contemplated by President Bush and some members of Congress who have said it is the only way to save the system. Congressman Matsui is the top Democrat on the Ways and Means Social Security Subcommittee. "The issue is whether or not it is worth it to maintain Social Security as the one leg of retirement planning that is guaranteed and not subject to risks, mistakes, or bad advice," Matsui said. "I believe very strongly that it is worth it. Social Security is not a problem thats insurmountable." Enrons swift collapse is serving as a hard lesson to the companys employees who were heavily invested in the company stock, a problem that several Congressional committees are investigating. Members of the IBEW have appeared to testify before Congress four times in the months since the companys bankruptcy. As Bill Miller, Business Manager and Financial Secretary of Local 125 in Portland, Oregon, told the U.S. Senate Committee on Governmental Affairs in February, just eight of his members who work at Enrons Portland General Electric subsidiary lost nearly $2.9 million. Many more of the more than 900 active employees and 550 retirees represented by Local 125 lost money by investing their hard-earned retirement savings in Enron. The Enron fiasco brings into focus the inherent risks in the recent trend away from "defined benefit" retirement plans, the traditional pension plans that protect workers retirement savings in the event of a companys failure. With retirement savings plans like the one Enrons employees had, workers carry the risks of investment rather than secure retirement. Defined contribution plans include 401(k) and profit sharing plans that tie the performance of a retirement fund to the financial performance of the company. "The message brought to Capitol Hill by our members and others who fell victim to Enrons shameless financial maneuvers is that corporate greed cannot be allowed to run roughshod over the retirement security of honest, hard-working Americans," said IBEW International President Edwin D. Hill. The IBEW leader stressed that the Enron debacle has buttressed the case for maintaining a safe, guaranteed Social Security system as a base for workers to be augmented by private pension plans that offer a defined level of benefits.
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IBEW Provides Key Testimony at Enron Hearings on Capitol HillIBEW Workers Testify Enrons Downfall Cost Them SavingsIBEW to Congress: Protect Workers From Enrons Abuse of Retirement SavingsEnron Web siteFind out more about Social Security |
