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May 12, 2005
Senate Asbestos Markup Fails to Clarify Bill’s Prospects
The Senate Judiciary Committee approved a manager’s package
yesterday of 12 provisions designed to build support for the asbestos
legislation, CongressDaily reported. The committee adopted
changes, suggested by Sen. Dianne Feinstein (D–Calif.), that would
ensure the sickest asbestos victims were compensated quickly while the
trust fund is created. Feinstein has said her support for the bill
hinged on the adoption of her amendment. So far, the bill appears to
have the support of five Republicans and two Democrats—short of
the 10 votes needed, the newswire reported.
United Airlines
New Strains on Safety Net for Pensions
A bankruptcy court’s approval on Tuesday of a deal between the
government’s pension insurance agency and United Airlines marks
the latest in a series of changes that are restructuring the
relationship between American workers and large employers, the
Washington Post reported. It also places severe new strains
on the social safety net that has underpinned traditional private
pensions since enactment of the Employee Retirement Income Security Act
in 1974. Read the full article at
href='http://www.washingtonpost.com/wp-dyn/content/article/2005/05/11/AR20050…'>www.washingtonpost.com/wp-dyn/content/article/2005/05/11/AR200505110174….
Unions Threaten to Strike after Pension Default at United
Three unions at United Airlines said yesterday that they were
prepared to strike to protect their contracts, after the carrier
received court permission to terminate four pension plans, the New
York Times reported. The unions—representing flight
attendants, bag handlers and machinists—all issued statements
saying members gave wide approval to strike. United contends any strikes
would be illegal because the rest of the workers’ labor agreements
remain in effect, the newspaper reported.
Looking to Keep Pension Agency Solvent, Congress Fears Backlash
While UAL Corp. was getting approval this week to terminate United
Airlines’ pensions, Congress was working to make that a harder act
to follow for other companies with underfunded pension plans. In dealing
with the growing problem, though, legislators face a tough balancing
act, the Wall Street Journal reported. Congress has been
drafting legislation that would strengthen the finances of the Pension
Benefit Guaranty Corp., the federal agency that insures private-employer
defined-benefit pension plans. Read the full article at
href='http://www.wsj.com/'>www.wsj.com (subscription required).
Fannie Mae to Delay Quarterly Report
Fannie Mae said yesterday that it would not file the required
first-quarter financial report with the Securities and Exchange
Commission on time as it undergoes a restatement of earnings, the
New York Times reported. The company, which is
government-chartered, announced the delay in a regulatory filing that
also disclosed a decline in its share of the market for mortgage-backed
securities.
Delta
Delta Stock Continues Dive after Warning
Delta Air Lines Inc.’s stock continued its decline Wednesday
following the company’s warning about further losses and the
possibility of bankruptcy, the Associated Press reported. Shares of the
carrier fell 42 cents, or 14.1 percent, to $2.55 in morning trading on
the New York Stock Exchange. If that figure holds, it would be the
lowest close of the company’s stock in at least 25 years.
Congress Cool to Delta-inspired Pension Fix
Legislation to give financially wracked Delta Air Lines and other
carriers substantially more time to fund pensions has hit turbulence in
Congress with key members balking at helping airlines only, Reuters
reported. The proposal was initiated by homestate lawmakers of
Atlanta-based Delta, which narrowly avoided bankruptcy last year and
faces a worsening cash crunch. Delta’s pension problems are acute
and the company is pushing hard for relief. “There’s no
doubt in my mind that if UAL comes out of bankruptcy without their
pension obligations that their cost advantage over carriers like
American and Delta will be huge and those carriers would obviously have
to face some sort of restructuring of those costs as well,” said
David Swierenga, an airline consultant, the newswire reported.
Retail Sales Climb 1.4 Percent Despite High Gas Prices
Retail sales increased a seasonally adjusted 1.4 percent, after
rising 0.4 percent in March, the Commerce Department said on Thursday,
the online Wall Street Journal reported. March sales were
originally seen rising 0.3 percent. February sales rose 0.7 percent,
revised up from a previously reported 0.5 percent increase. Soaring
demand for cars helped boost the overall retail increase.
America West Pilots Union Chief Resigns
The pilots union at America West Airlines replaced their leader as
the company prepares for a possible merger with US Airways Group Inc.,
the Associated Press reported. The chairman of the master executive
council of the Air Line Pilots Association, CJ Szmal, resigned at the
request of five of the six pilot representatives after holding the post
for less than a year, the union said.
Trump Hotels Expects May 20 Bankruptcy Emergence
Trump Hotels & Casino Resorts Inc. on Wednesday said it expects
to emerge from bankruptcy on or about May 20, Reuters reported. The
company, which filed for bankruptcy on Nov. 21, 2004, said it will
request court approval to use the reorganization plan’s effective
date as the record date for making distributions under the plan.