Tuesday, November 29, 2011

Gaping Hole?

The New York Times tells us (after looking at a certain on-line video):

... Speaking at Local 80, [MPIPHP administrator David Wesco] put the pension financing shortage at $190 million. Increased health expenses, he said, would require an additional $180 million to stay even with current benefits. About $75 million would be needed to keep the reserves at a safe level of six to eight months.

Mr. Wescoe is speaking of a three-year shortfall for the Motion Picture Industry Pension and Health Plan of $445 million.

That kind of money is nothing to sneeze at, but it's not like we haven't forded this kind of stream before. There was a "gaping hole" three years ago. The way it was filled then was:

1) The producers chipped in more money.

2) The Health Plan was "redesigned." (Meaning that participants chipped in more money by assuming more of their own medical costs.)

3) Benefits were cut.

4) Reserves were reduced.

To a greater or lesser extent, similar routines have been going on for years in IA-AMPTP negotiations. There is X amount of dollars on the table, our mother international strives to squeeze out a few bucks more, and then the money is placed where it's most needed. Sometimes that means wage bumps; sometimes heftier benefit contributions.

And sometimes the cost projections turn out to be overly optimistic, and adjustments are made mid-flight. (More cuts; more contributions.) All these "Town Hall" meetings have been held to inform the IA membership of where the cash has been going, and how much is needed, which is a good thing. Knowledge is power.

The New York Times article seems a bit alarmist to me, but the Gray Lady doesn't know the negotiating history of the producers and IATSE. If the paper had more backward-looking knowledge, it would see that variations on this "fill the hole" dance have been done before.


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