The world has changed. Someone needs to tell the United Auto Workers.
If union officials think benefits can stay even remotely the same as they were a half-century ago, and not drive American car manufacturers into the ground, they're going to be the death of the domestic auto industry.
It would be a high crime indeed if the United States put itself in a position in which it did not, or could not, make its own automobiles. But unless GM and Chrysler get some help from bondholders and the UAW, the domestic car industry will be in huge danger.
We hope UAW officials realize they can no longer hold onto the wages and benefits of the past if the industry is to endure. But it doesn't look good.
A union official, for instance, said company proposals to trim benefits "are a non-starter as far as the UAW is concerned."
Fine. Maybe they can finish off the companies, then.
In a typically pro-union reflex, the Obama administration seems concerned that other parties share the pain with the UAW. But it's not at all apparent that the union will take on much of the necessary pain itself.
In the country's attempt to save its crucial automobile-manufacturing capabilities, truly no idea can be considered a "non-starter."
One of the items in question is the "supplemental unemployment benefit" that gives laid-off UAW workers nearly full pay. It's been in place for over 50 years.
It's clear to everyone except the UAW that the car companies cannot continue such expensive benefits and still survive.
By the terms of the $17 billion in federal bailout loans they received late last year, GM and Chrysler were required to formulate and hand over to the federal government on Tuesday plans for restructuring their companies.
GM's CEO Rick Wagoner has ruled out bankruptcy protection, claiming no one will buy cars from a company engulfed in bankruptcy court proceedings. But we don't buy that. Bankruptcy might actually be the companies' safest restructuring route, as it would allow the company some help in reducing its massive debt, particularly its benefit-laden union contracts.
And consumers have shown their willingness to patronize airlines and other businesses that used bankruptcy court to endure.
A much easier route to solvency, of course, would be if unions realized it's 2009 and not 1959.
Comments
Figuring in benefits, the UAW worker earns $153/hour. There's no way an auto manufacturer can compete while paying employees and ex-employees this wage. The manufacturers that have set up in states that allow "open shop" hiring are producing a comparable or better product for much less money. Hundai and Toyota are building new facilities in America right now. Neither is building in a "union" state. Reality bites.
union states are doomed. when obama et al finally get around to dealing with offshore companies and force these companies to start using american workers, watch which states the companies WON'T move their factories.
Someone please explain to me why the administration is pushing the new law abolishing secret ballots for voting in a union!
While you're at it please explain the benefit of not being able to fire a bad unionized school teacher.
Nonunion, nonDemocratic workers will pay the benefits for those who belong to the union/Democratic Party. Pictures of Obama adorn the union halls. The message is clear, party members will be taken care of. Yeah, y'all know what it sounds like.
Robert Reich has some words of wisdom titled "The Stimulus and the Auto Bailout: The Perils of Confusing American Companies With American Jobs"
http://tpmcafe.talkingpointsmemo.com/talk/blogs/robert_reich/2009/02/the...
And the Mayor of Lansing, Michigan takes it to FOX News:
http://www.dailykos.com/storyonly/2009/2/18/15119/2121/695/699003
The unemployment supplement and other benefits for auto-union workers are rediculous. If bankruptcy is the only way to get out of union contracts, then start filing. Those who are hungry will come back to work without a contract and those who aren't willing can be replaced with the millions out of work from other industries.
The authors of the stimulus do not recognize the solution to the problem with the auto industry, if you drive sales, volume cures all problems. Everything in the "package" seems geared toward the industry, not the consumer, and that is a fatally flawed strategy.
Americans inherently wish to buy American, except those that feel it is gauche to own American. However, Americans prefer the best product at the best price. Only Ford seems to have realized that phasing out it's "closed shop" facilities allows it to stay up to date and competitive in the market place. Unions stifle growth, imagination and production.
but Obama wants it easier to get unions started with card check.
Some years ago when I lived in MI I was driving through downtown Flint when I encountered about two dozen UAW picketers in front of an abandoned, dilapidated auto plant. Stopping at a nearby coffee shop I asked why they were picketing. Apparently many years before that GM gave the autoworkers a choice of a status quo in their contract or if they insisted on the fat increases in pay and benefits, GM would have to close the plant and move that operation to Mexico. Proudly the workers stuck to their guns. GM closed the plant putting everyone out of work and they had been picketing ever since...... That of course made sense to the workers......
i resent that my hard working employees have to subsidize people that make 3 to 4 times the money they make.
The American citizen has been supporting the UAW for years. We've been buying ever more costly vehicles that have become increasingly inferior to the foreign products. What we're seeing is another example of top heaviness and the American comsumer shrugging off the weight.
When little children throw a tantrum & stomp their feet it is not good parenting to give in to them. I'm not sure this economic climate has room for any union that adds much cost to a product or service. If Obama is telling the truth and this is indeed the worse economic times since the great depression, perhaps this administration should act boldly and swiftly to eliminate all UAW contracts. I would think Obama would want to be perfectly clear and start this process with complete transparency.
The union has the big O in their pockets. But yet the dems still want to bring up Chaney and Haliburton. God help us.
American cars are just as good as the foreign cars. The unions have just made them cost more. A friend just bought a Toypta Landcruiser and when you compare it to a Tahoe or Yukon that cost the same money. I would take the Yukon anyday. Same gas milage as the Yukon and the Youkon is larger, more comfortable and just as well built. Right now I have two Escalades, one with 97000 and the other with 72000 and never any trouble. They run as good as the day I purchsed them in 2004 and 2007.
Its amazing that the LTE didn't address the cost of CEO and management (Jetliners, Spas, Parties, Bonuses etc..) as adding to the cost of vehicles. I guess those things are just part of doing business. And Justus4 your way of thinking is exactly what will allow CEO's to pay minimum wages across the land. I wonder if you could live on minimum wages?
i have a ford explorer with over 200,000 miles on it (1997), no problem transmission and motor original and still going strong. Get rid of the unions and if people want to work they will be there. Buy american and hire american.
Anybody go to cain's recommended website. So typical of democrats. I should have known when I saw it was the Daily Koz. The Fox News guy is trying to have a conversation and the good Mayor becomes rude and argumentative. Of course, the Daily Koz people love this. Of course, with unemployment reaching 10% in Lansing, the good mayor is obviously doing a REAL good job. He really showed that Fox News guy...yeah.
Ole H.R. Gross got kind of upset that someone up the thread wrote REDICULOUS. But he is wrong, it is a word. It means a redhead who is ridiculously hot.
patricia - you've got to quit listening to the idiot Glenn Beck. According to the Wall Street Journal, "UAW workers make about $55 per hour in wages and benefits, compared to $46 at plants operated by Asian auto makers, according to Barclays Capital."http://online.wsj.com/article/SB123388066021554821.html?mod=rss_whats_news_us
The Heritage Foundation’s 2009 Index of Economic Freedom, which, according to them provides strong evidence that countries that maintain the freest economics do the best job of promoting prosperity for all citizens. When looking at the list, check out the union density data:
1. Hong Kong — 22.1 percent
2. Singapore — 18.5
3. Australia — 20.0
4. Ireland — 35.0
5. New Zealand — 21.1
6. United States — 12.0
7. Canada — 29.7
8. Denmark — 80.0
http://blog.heritage.org/2009/01/13/the-2009-index-of-economic-freedom/
While, of course, they don't speak of unionization, they do correlate a country's economic freedom with poverty reduction, human development, political freedom and environmental protection.
southern you are correct about this political arena being interested in only their illegals and poverty voters. But those of us with jobs who actually earn the money must try and support American products. The farmer's market is open and a great buy for local american veggies and fruits. It is only a small bit but eventually those small bits add up to big chunks.
We will see if BimbObama will stick to his guns and force Chrysler and GM into bankruptcy when they don't meet UAW demands and do not come up with a plan to make a profit that was due Tuesday to get more bail out (hand out) money. Nobody stopped flying airlins that declared bankruptcy and Donald Trump is still a billinoare who has filed bankruptcy in the past. Screw the UAW and the mob/thugs that run it.
Cain, he didn't answer the questions either. Typical lib.
Wow, I actually agree somewhat with Justus4. Thats a first. Maybe its because he didnt try to make this subject about race. Congrats on your first, Justus4.
I agree with you, Hoss. It was a very pleasant change from the norm.
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