Wednesday, January 13, 2010

One Year Anniversary of Nortel filing chapter 11

Tomorrow, January 14th,2010, is the one year anniversary of Nortel filing for bankruptcy protection in the USA, Canada, the UK and other countries. One year later many of us are still wondering how it could be possible that such a great company could be brought to its knees in what seemed such a short time.

Having spent 35 years in Nortel working in Canada and the USA and seeing the breadth and depth of talent and brilliant people who made Nortel a world wide powerhouse in telecommunications, I am nothing less than astonished that this giant could be slain by a few incompetent and arrogant insiders. In retrospect, the board of directors are really the culprits for they rubber stamped the outrageous plans and programs that squandered Nortel's wealth and goodwill.

But all of that is past, and we now face a bleaker future than we ever thought was possible when we retired. Many of us have already lost money when Nortel pulled the plug on our non-qualified pension, or TRA, or severance, or health insurance , and we all worry about the final wind up and what it may mean to our claims and any pensions or coverage that is continuing today.

As we retirees and ex-employees try to rationalize the impact on our lives and standard of living, the lawyers have feasted on the money that could have gone to help our trust funds. The executives left running the company into the ground have voted themselves bonuses, and the captain who placed the company on the rocks has jumped ship in his gold plated lifeboat.

Once we all thought that Nortel was so important to Canada, that there was no way the Canadian Government would let it fall. My how we were mistaken! Not only did the Canadian Government turn a blind eye to the legal shenanigans, but they also turned their backs on the retirees. Perhaps they felt that the older vote was no longer important. Perhaps they just didn't care. It was more important to bail out General Motors than to assist one of their own corporations when it faltered. Never mind all the important contributions Nortel and it's employees had made over the years, it just wasn't politically correct to help save them.

For a while our hopes were raised that the Government might act to change the Bankruptcy Insolvency Act to place pension funds in a priority position ahead of unsecured creditors in the event of bankruptcy. But once again the powers that be, worked to oppose that possibility and have short circuited the motion and dashed our hopes.

Now we await the final act as Nortel heads to wind up this year. It's clear that our Canadian pensions will be impacted badly as the trust fund has been let dwindle, under the noses of the Canadian regulators, and the market is such that we will suffer additional losses in transferring pensions into annuities. At least in the USA and the UK the government pension insurance plans have helped out and kept many retirees afloat. But not in Canada! No, the country that takes pride in it's humanitarian culture will let the pensioners hang out to dry, because it doesn't have any form of pension insurance or protection.

Let this be a lesson to all you Canadian boomers our there approaching the golden years. You too could find yourself Nortelled by the government of the wonderful country you live in.

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