When the Detroit Diesel Retirees social club meets tonight, its members will have uncommonly weighty decisions to make. The order of business will include reviewing a set of bylaws with a certified public accountant, taking nominations for a new board of directors and hearing from the night's guest speaker: a pension lawyer connected to a Washington lobbying group.
For the past few months, the suburban Detroit club of 700 nonunion retirees from General Motors Corp. has been exploring the idea of becoming a full-fledged advocacy group. The move would make it easier to link up with a network of other retirees already lobbying through the National Retiree Legislative Network.
The white-collar retirees -- engineers, designers, managers and other employees -- recognize it's time to act. A massive and brutal restructuring lies ahead for the Detroit auto industry. GM made a deal with the United Auto Workers union for cuts in health benefits for unionized retirees. The bankruptcy of auto-parts giant Delphi Corp. jeopardizes the pensions and health care benefits of thousands of workers.
Tonight's meeting, the group's annual dinner, could vastly change the way the retiree club operates -- replacing buffet lunches and gossip with campaigns comprising organizing, writing letters and calling congressmen.
"This is a big year," said Richard Schwaller, a 76-year-old retired GM service manager. "Because of the severity of the situation, it's obvious that we need a voice, and the only way we will have a voice is to organize."
Auto industry retiree clubs are joining white-collar retirees from other downsized American industries. The NRLN, which was founded in 1999, coordinates the lobbying of 25 worker associations that together have 2 million members. It includes groups of workers from old telephone companies including U.S. West, former aerospace engineers from Boeing, and retirees from life insurance companies such as Aetna and Prudential. Yesterday, the Lucent Retiree Organization, which has 8,700 members and is affiliated with the NRLN, criticized the company for increasing health care premiums by as much as 39 percent for former management employees. "There's always strength in numbers," said Ed Beltram, a spokesman for the Lucent retiree group. "By affiliating with the NLRN, we feel we have a stronger voice to influence legislation."
Retiree Jim Norby, director of the NRLN, is in town this week to figure out how to get pension legislation back on track in the Senate. The legislation would tighten pension funding rules for companies.
"While retirees were off in retirement attending to our grandkids and working on our golf games and playing in our gardens, our former employers went off to Washington and put their heads together with the politicians and started amending the pension laws," Norby said. "Now it's as full of holes as a piece of Swiss cheese."
He said the group will combat the companies' lobbying money with letters, e-mails and visits to congressmen by NLRN members. The group has representatives in each congressional district and legislative directors in each state, he said. In Washington, the group has a staff of three lobbyists.
Rep. John F. Tierney (D-Mass.) said the group has helped generate sponsors for his bill that would make it harder for companies to renege on retiree health care promises. "I've seen them come down to Washington and go from member's office to member's office to make the case how unfair it is for companies to make promises and not keep them and how detrimental it is to people in their sixties, seventies and eighties," he said.
He said his bill has 100 sponsors, many of whom joined after visits from Norby's group. But he said the lack of Republican support and the opposition of business groups remain stumbling blocks. "If enough of these organizations like the NRLN makes enough noise, the grass roots is going to convince these people that something has to be done."
Phyllis Borzi, a research professor at George Washington University who is working with the NRLN, said retiree interests are usually swamped by industry lobbyists, but perhaps not for long. "Retirees have a lot of time on their hands. Most can still drive. They can go vote," Borzi said. "As the balance of the population begins to shift to older people, the retiree is going to play a larger and larger role in this society. This is an important voting and social bloc."
The Detroit Diesel group isn't the only retiree social club in the area that's worried. By themselves, they say, they've been powerless to get GM to hear their complaints about their escalating health care costs.
Other auto retiree groups are going through the same process. Harold Payne, a member of a group of former designers at Ford Motor Co. that meets monthly for breakfast, said he put the approval to seek nonprofit status on the next meeting's agenda. "There's got to be a cohesive force for all the retirees that will work in Washington," Payne said. "We've got to formalize anything that we are going to do. We can't just be a willy-nilly group of guys who meet for breakfast."
Not all GM white-collar retirees are angry about their rising health care bills. Some from the company's Baltimore truck plant, which GM closed this year, said they expected to pay more to help GM gain its footing during this latest period of trouble. Retiree Jack Summers of Forest Hill, Md., said some members of the group are upset but most understand that the bottom line is GM's need to stay competitive. "I think everybody expects that they are going to have to pay a little more," he said.
David E. Cole, chairman of the Center for Automotive Research, estimates that the Big Three automakers have 150,000 white-collar retirees. Unlike their blue-collar counterparts, most of whom worked on the factory floors, the white-collar employees had no UAW contracts that guaranteed retiree health care.
GM said the deal it announced Monday to cut retiree health costs slashes $15 billion, or 25 percent, of GM's health liability in coming years. In the past, the UAW rarely succumbed to pressure to cut benefits for its workers. But white-collar workers have been suffering these cutbacks for years. Now, Cole said, "They are trying to get some traction so they have a little more collective power."