Both of my father’s parents worked for General Motors. My grandfather was a master mechanic for the executive fleet and my grandmother was a janitor at one of the plants that used to be in Flint, Michigan. Even though they made GM their careers, I don’t ever remember them working. Why? Because they both retired in 1984 when I was only one year old.
My grandfather passed away in 2007. My grandmother is still alive. To this day, GM pays her medical bills and sends her a monthly pension check. Up until my grandfather died, he got the same benefits. They got these benefits from GM despite the fact that they hadn’t worked there in over twenty years.
This is an added advantage for the family and we all have my grandfather to thank for the benefits that we are reaping because as long as he was with GM, he made sure that he had excellent relations with his superiors, equals and subordinates and this helped him in establishing great connections with one and all and the pension that he received despite not working for a huge time period was more than enough to make ends meet. To top it all, we did not have the San Diego bankruptcy lawyers hounding us for loan issues because we found no need to take it at any point of time.
Defined benefit pension plans are going to become extinct. A company cannot continue operations and remain competitive when they have to pay hundreds of thousands of retirees who no longer work for them. I am not surprised that GM is not doing well. Just the medical costs for their retirees must be astronomical!
General Motors faces a critical June 1 deadline to lay out a restructuring plan. GM has to persuade bondholders to swap out $27 billion in bonds for 10 percent of its risky stock. GM has to announce plant closures and negotiate with unions. They have to do years of restructuring in three weeks.
Don’t be surprised if General Motors files for bankruptcy protection sometime near the first part of June. GM has already received federal aid totaling $15.4 billion. The Chrysler debacle has shown that Motor City is not immune to chapter 11 bankruptcy.
Furthermore, it seems strange to me that General Motors is taking action to make sure that “if” they go in to bankruptcy that it will proceed in an expeditious manner. Hmm. Sounds awfully fishy to me. It’s almost like GM knows they are going in to bankruptcy, but don’t want to say anything. They would rather keep everyone on the edge of their seat.
A GM bankruptcy will prove disastrous to Michigan. I talked to my grandmother, the ex-GM employee, this morning. She told me how bad crime has gotten and how many people are without work. She told me that several day care centers are closing because people are taking care of their children. One of her favorite diners that was near the GM factory that she worked at for thirty years is closing its doors – the factory has been closed, therefore they lost their customer base.
My mother works at a fudge shop in Frankenmuth. Frankenmuth is a town situated between Flint and Saginaw. She said people are coming to the fudge shop for their treat. It’s much cheaper than going out to eat. The faces she sees are no longer happy and cheery faces. She sees sadness.
I haven’t been to Michigan since 2007. When I left in 2001 things were still going strong. During my youth, it was such a vibrant and wonderful place to be. I honestly always thought I would go back. The last time I was there I saw the gray, dreary winter sky and seen the signs of increasing unemployment. This was long before the “recession” was announced.
I can only imagine how things are now. My family members always sound reserved when I talk to them. During my child hood they were all so animated and vibrant. The truth of the matter is the whole state of Michigan relies on GM, Chrysler, and Ford. Even if someone doesn’t work for GM, Chrysler, or Ford, chances are their business relies on a customer base which includes people from GM, Chrysler, Ford, or their suppliers.
I really hope that GM can turn their game around in the next three weeks. For some reason, I just don’t think that will happen. Hopefully if they have to reorganize, they can come back stronger than ever. I hope so for the sake of the state where I grew up. I hope so for the sake of the many family members I left there.