Our blogging buddy, attorney Bob Toth, blogging from a ski slope in Quebec province, discussed the demise of defined benefit pension plans, Continuing the DB Demise Discussion. He notes that there are only 19,000 defined benefit plans now being covered by the PBGC.
The context in which Bob writes is what is generally perceived to be “Corporate America”. He quotes Nassim Nicholas Taleb from his book, The Black Swan: The Impact of the Highly Improbable:
Consider the following sobering statistic. Of the five hundred largest U.S, Companies in 1957, only 74 were still part of that select group, the Standard and Poor’s 500, forty years later. Only a few had disappeared in merger; the rest either shrank or went bust.
But that’s Corporate America as it used to be. From my vantage point, Corporate America is small business owners, and defined benefit plans are very much alive and well with new plans being adopted.
Just like Fleetwood Mac who after many years apart are back together, defined benefit pension plans are back and better than ever. Here is a presentation I did last year on that theme.