Watch CBSN Live

Forget The Social Contract

This column was written by CBS News Early Show anchor Harry Smith.

I guess I'm old enough to remember the social contract. They started tearing up the social contract what -- thirty years ago?

The industrial heart of the country turned into the rust belt. First it was the layoffs, then the plant closings and eventually the pension funds were raided. The workers were caught unawares and then the government had to bail out the pension funds.

So many companies have gone this route the government fund that pays failed pensions is actually $23 billion in the red.

I grew up south of Chicago. The men in my neighborhood all worked in the steel mills. They had great jobs -- pay enough to buy a modest home and time off enough to take a vacation. The working class was getting its hands on some of the benefits of the middle class.

But that was back in the day when a single breadwinner could support an American family. Remember that?

I read that the union rep for the United Airlines flight attendants broke into tears when the judge said it was OK for the airline to dump its pension fund on the government.

The government just doesn't pay what the pension promises. Take US Airways as an example. The New York Times says the pension cuts there were from 15 to 65 percent. Some say Delta Airlines may be next. And with their debt relegated to junk can GM and Ford be far behind?

Impossible you say. That's what everyone else thought. In Darwinian capitalism it's adjust to the market place or die.

As for promises? Don't be naive.

By Harry Smith

View CBS News In