Corporate pension funds are massively underfunded in the United States, the workers for a number of corporations have lost big chunks or all of their pensions in the last decade as Corporations ran through bankruptcy. On the other hand the Post Office is being put out of business because Congress has required them to stockpile the money to cover 70 years worth of pension obligations in 10 years. Why is Congress so concerned about the pension obligations of the Post Office and so oblivious to Corporate pension obligations?
Corporate profits are near all time highs, and economic experts say the main reason (besides layoffs) is because the Fed has kept interest rates at essentially zero, so Corporations can borrow to fund their operations at historically low interest rates. On the other hand student loan debt is at historically high levels, the interest rates on student loans are much higher than in decades past, and Congress is trying to push interest rates up further on many student loans.
Sometimes it seems like in the last decade this country has turned common sense good economics on its head.
Wednesday, June 6, 2012
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