"Retiring with More Dignity and Comfort"

These were the words uttered by a union leader after the International Association of Machinists District 751 overwhelmingly rejected Boeing's contract offer with 67 percent of the vote.  Boeing's offer would have secured an estimated 20 years of steady work in the Seattle area on Boeing's 777X jet. 

Media outlets report that the offer required the union to "terminate" its current pension plan.  While that is technically true, the report is not accurate or complete. 

The offer would have required union members to replace their defined benefit retirement plan with a defined contribution retirement plan.  The offer would have also required a greater contribution for health care costs.    

Boeing is now considering building the 777X elsewhere.  If Boeing takes that line elsewhere I guess those union members can start receiving that dignity and comfort for which they voted sooner than anticipated. 

What was so terrible about the healthcare plan?  It would have required workers to pay more for their health care.  Wow.  Isn't that what we are all doing?  Under the Boeing offer, employees would have been limited in their expenditure to 16 percent of costs.  Many employees pay 30 to 50 percent of health care costs.  I'm sorry the union's dignity was so offended by a cap of 16 percent!  Tell that to the millions of people who are losing their health care plans, or facing substantial increases in health care costs due to Obamacare. 

I understand why the union did not want to terminate the defined benefit plan.  It means guaranteed income for life, provided the plan can function.  But the model does not work in today's economy.  We have a shrinking workforce paying the benefits of a much larger retired workforce that lives longer.  Too much pressure cause the plans to fail.  If you don't believe me, just ask the Cities of San Bernardino, Stockton or Detroit. 

Was the Boeing defined contribution plan a terrible offer?  No.  The company would have contributed 10 percent for two years, then a reduced amount thereafter.  Moreover, employees could save and add their own money to their retirement accounts.  

We live too often for today and give no real thought for our future.  We may attempt to disguise our failure to provide for ourselves by using terms such as "dignity and comfort."  However, for the International Association of Machinists, today's vote means the very real probability of losing work to someone else in another part of the country. 

So much for dignity or comfort.