Government lawyers thumb nose at Delphi retirees’ request for amicable solution to pension scandal

Matthew Boyle | Investigative Reporter

The Pension Benefit Guaranty Corporation (PBGC) on Wednesday officially declined a request for a non-binding mediation with representatives of the more than 20,000 Delphi retirees whose pensions were slashed during President Barack Obama’s 2009 auto industry bailout.

“After seven weeks of talks, attorneys for the Pension Benefit Guaranty Corp. late Wednesday rejected the suggestion of non-binding mediation with Delphi salaried retirees who have been suing to have their full pensions restored,” the Dayton Daily News’ Thomas Gnau reported late Wednesday night.

The mediation request was an attempt to settle the matter out of court, and the PBGC’s decision to reject the offer came as a serious disappointment to a group representing the Delphi retirees. According to Gnau, Delphi Salaried Retirees Association legal liaison Chuck Cunningham told his fellow retirees on Wednesday that they had been duped by the PBGC.

“When we talked to them at first, they were very receptive,” Cunningham said. “They said this is the kind of thing they like to do. Then all of a sudden, they said they had to run it [the proposal] up the flagpole.”

At the top of that flagpole is none other than Treasury Secretary Timothy Geithner, who sits on a board that advises the PBGC. Spokespersons for the Treasury Departmant have neither confirmed nor denied Geithner’s possible involvement in killing these mediation talks.

Ohio Republican Rep. Mike Turner said he was “disappointed” when he found out “that the PBGC has rejected the request of Delphi Salaried Retirees to engage in non-binding mediation.”

“With countless retirees throughout Ohio and across the county, PBGC’s refusal of the Delphi Salaried Retirees’ good faith offer to discuss the rightful restoration of their pensions is disheartening, but not surprising,” Turner said in a statement. “For years now, this Administration has denied these retirees, Congress, and American taxpayers the transparency and answers they deserve. I remain committed to uncovering the truth behind the Administration’s backroom deal to slash the hard-earned pensions of these Delphi Salaried Retirees.”

PBGC spokesman Marc Hopkins told TheDC that “PBGC isn’t opposed to mediation, the agency enters into mediation in a number of cases to resolve disputes. In this case, PBGC can’t provide the remedy Delphi retirees seek: to be paid more than the guarantee limits set by Congress.”

“We continue to talk to lawyers representing Delphi retirees on a range of issues including ongoing discovery that will produce more documents pertaining to the termination of Delphi’s pension plans,” the PBGC spokesman added in an email.

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