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Foss: GE's decision to freeze pension regrettable

Foss: GE's decision to freeze pension regrettable

Decision is another reason to doubt that GE will ever return to glory
Foss: GE's decision to freeze pension regrettable
Photographer: GAZETTE FILE PHOTO

American powerhouse. 

Icon of American industry. 

A quintessential American company. 

These are just some of the descriptions of General Electric I encountered while reading about the company's recent troubles. 

Almost every article acknowledged GE's illustrious past, expressed shock at its downfall and wondered whether the company would retool and rise again.  

"Whether its storied corporate brand can be revived has become the largest question about GE," a 2018 article in Fortune magazine, titled "What the Hell Happened at GE?," observed. "The company faces no crisis of survival. Its main businesses will likely carry on in some form. The tension surrounding the company is of a higher nature, befitting GE. It's whether this extraordinary company will regain its lost luster or descend, at last, to mediocrity." 

I'm betting on mediocrity. 

It's been evident for some time now that GE is becoming just another American company. 

The latest sign of General Electric's slide into ordinariness is its announcement that the company would freeze pensions for 20,000 workers and offer pension buyouts to 100,000 former employees. 

Most assessments of GE look at stock price and financial performance, both of which leave something to be desired.

But the company's treatment of employees is also revealing. 

One of the things that always made GE special was the high quality of benefits it provided workers and retirees. 

And while the pension announcement was no surprise, it was still a disappointment, and another reason to doubt that GE will ever return to glory. 

A company that once distinguished itself by providing benefits that were the envy of workers everywhere now seems intent on demonstrating just how little it cares for rank and file employees. 

What makes GE's pension freezing all the more galling is CEO H. Lawrence Culp Jr.'s handsome compensation package — $21 million a year in salary, bonuses and stock for the next four years. 

As the business website Dealbreaker wrote, "We're all for paying people absurd amounts of money when they return absurd multiples of that amount to shareholders, but that philosophy stretches credulity when the company is 2019 GE and the CEO is punching down to cut costs, pump the value of his company shares and hit his targets." 

If GE really wants to reinvent itself, it could start with the outrageous compensation packages it provides CEOs. 

Of course, corporate pensions are mostly a thing of the past, which is one of the reasons GE can get away with freezing them. 

In 2012, GE closed its pension plan to new beneficiaries — another indication, if you were paying attention, that the company was sliding into mediocrity. GE's cold-hearted 2014 decision to drop its health insurance for retirees also signified a desire to slash costs at the expense of workers. 

GE isn't the only company looking to spend less on its employees. 

Most companies have done away with pensions and forced their employees to shoulder more of the burden of paying for health care. 

But it's still sad to see a company that once seemed to pride itself on how well it took care of employees and their families following suit. 

And it's one of the reasons that, try as it might, GE will never be the icon of American industry that it once was. 

Reach Sara Foss at [email protected]. Opinions expressed here are her own and not necessarily the newspaper's.    

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