The Monday letter, “It’s not workers who are greedy” contains many misleading statements, such as, workers “only get a 1 percent pay raise every two years.” The writer conveniently omits that it is 1 percent, plus inflation. Workers cannot reasonably expect to get more money for the same work if that work does not provide more value to the employer. The way to get more money is to work hard and get promotions. For those of us who remember the 1970s, with double-digit inflation, inflation protection was a big deal, and could be again.
Th letter erroneously implies that the Boeing 401k is the same as Enron’s. Enron employees were required to have all their 401k money in Enron stock, which is not the case for Boeing. The Boeing 401k has several investment options, ranging from conservative to aggressive. The employee can select which funds or combination of funds they wish to invest in, and can switch both existing funds and new contributions any time. With reasonably prudent selections, it is likely that upon retiring after a full career the employee could invest the 401k funds in safe securities, such as U.S treasuries, and get a similar income from the interest that the pension would have provided. And, as a bonus, the principal could be passed on to the employee’s heirs upon death, unlike a pension.
In the $10 billion buy-back program, Boeing does not buy back stocks from its employees against their will. It buys the stock on the open market, which has no impact on employees except for those who invest in Boeing stock. Those employees will benefit from the buy back. The “buy-back” that the writer is referring to was to cash out stocks from employees that had been awarded stock, but had extremely small balances. I don’t recall the amount, but it was certainly under 100 shares.
The writer implies that Boeing owes its profits to its employees. Boeing, and all other employers, owe their workers fair compensation for the value they provide to their employer. In the case of McNerny, if his contribution to profits significantly exceeds his compensation, then he’s earned it. If Boeing loses money, which it has in the past, will the employees volunteer to give their pay back to the company? I don’t think so, but stockholders will lose money.
The writer implores us to do our research and get our facts straight. She would do well to take her own advice.