Bailing out the Big Three US automakers
Posted by Mike Sylvester - 11/18/08 @ 8:57 am - Filed Under National Politics
Much has been written about bailing out the Big Three US automakers: GM, Ford, and Chrysler.
As I am sure you have guessed; I oppose bailing them out. Bailing them out makes no sense to me because their business model is not economically viable for several reasons:
1. Toyota builds cars in the US and their labor cost is a whopping $45 per labor hour. This is a very high cost as it is. The Big Three have an unsustainable labor cost of $78 an hour. Both have plants and facilities in the same country, operating under the same tax laws, etc. This means that Toyota will ALWAYS be able to make cars that are significantly less expensive. The Big Three absolutely has to cut costs to stay competitive.
2. The big three expected to sell about 15 and a half million cars in 2008. Currently it looks like they will sell about 11 and a half million cars. Their production facilities are geared up to make even more then 15 and a half million cars. Clearly the big three need to cut production, close production facilities, and lay off workers and management since their sales have dropped so far.
3. The Big Three are losing staggering amounts of money each and every quarter. Consider that GM spent 6.9 billion in cash and Ford spent 7.7 billion in cash just in the third quarter of 2008!
4. The head of the UAW came out Saturday and said that there would be no concessions from the UAW. None. He said the bailout was due to the economy not due to the Big Three. What an idiot, the UAW needs to agree to concessions just like management does.
5. Management at these companies is broken. Their business model has completely failed. They are losing market share to companies like Toyota because they refused to focus on fuel efficient cars and because their cost structure is far too high to sustain.
It is interesting how the Big Three (Along with many other companies and industries) are claiming that it is not their fault they are almost bankrupt; instead it is the fault of “the economy.”
Give me a break.
The car companies are no longer giving new car loans to people with bad credit and the truth of the matter is that they NEVER should have given people with bad credit new car loans. This is one of the main reasons why their sales have dropped.
Another reason is the economy, the last several years have seen significant economic growth and every company should have plans in place to deal with an economic slowdown or recession. The Big Three have not planned for a possible recession and have been unwilling to make the necessary cuts to make themselves viable.
I want to see the Big three go into Chapter 11 Bankruptcy. Large airlines have been in bankruptcy several times and are always able to move forward. In Chapter 11 Bankruptcy the Big Three will be able to cut costs and make the changes needed for economic viability.
If the Big Three go into bankruptcy it will be bad for the US economy; I do not deny that at all. There would be layoffs and it would effect their suppliers; however, it would not be as bad as The Big Three and their supporters want everyone to believe.
Bankruptcy is a normal process for a company that cannot meet its financial obligations.
If we loan the Big Three another 25 billion dollars (In addition to the 25 billion we ALREADY loaned them this year in order to help them make fuel efficient cars) then the Big Three will keep operating under their failed business model and then they will come back to the Federal Government in a year or two and ask for more.
Just get it over with now…
Let them go into bankruptcy.
Mike Sylvester
Comments
63 Responses to “Bailing out the Big Three US automakers”
Leave a Reply
As most of you figured on this one I agree whole-heartedly with Mike. Having spent a number of years in upper management (general manager, general sales manager, sales manger new, sales manager used, and F&I manager) of some highly successfull dealerships, I can tell you first-hand the 90’s and early 2000’s was spent clamoring, catering to, and aggressively going after “marginal credit customers” because of profitability. Less educated customers with “sketchy” credit history provided a profit potential waaaaaay above selling to cash buyers and good credit customers. To put it in dealership terms, (especially from an F&I standpoint) we could “rip their heads off and shit down their neck”.
It’s with some bittersweet irony I get to say “I told you so” to some of those dealers I worked for who will end up out of business. I really don’t wish financial ill-will on ANY business because of the the rest of the employee’s that get whacked, but it’s going to be kind of fun watching these morons completely change their advertising agencies and sales approaches to once again attract the real buyers. It will be too late for some of them, as I watched them routinely ignore and piss off cash buyers, local business people and “savvy” buyers with pristine credit by running them through sales “track” selling systems, most of whom opted for the import route, or the internet purchase.
Anybody with any brains can look back and see the trend. The first to bite the dust were the buy-here pay here dealerships, then the real estate business, and now the big three dealerships. You had to be really greedy and really blind to not see this coming, which is why those of us that maintained a customer base of “real people” in both the auto biz and the real estate biz, still have clients and sales.
We’re gonna see a huge “thinning’ of herd and it’s long overdue.
Let ‘em all file bankruptcy, that’s the mechanism in this country that has been in place for some time. Throwing money at the banks, insurance companies, and especially automakers and dealers is futile. You can’t rebuild anything without a bottom foundation and until we quit artificially propping these entities up, there will be no base to build upon. You gotta bottom out and build up from there, clean!!!!
I’m also not in favor of a bailout package for the Big 3.
Honda and Toyota seem to be changing with the times, why should tax payers front the bill and prop up GM for a few more months, years ? I fear if an auto bailout is granted, jobs still will be slashed and lost, factories still will be closed, and GM still will be facing inevitable bankruptcy. An auto bailout only will be delaying the entire process.
If any kind of bailout money is approved - why not direct it towards the bottom of the food chain by extending much-needed health care and unemployment benefits for those workers who will be out of jobs due to GM and the UAW’s incompetence.
Also - The Times ran a story on the government-backed bailout of the British auto maker, British Leyland, which happens to no longer be in business.
Its definitely worth the read:
http://www.nytimes.com/2008/11/18/business/economy/18car.html?em
one interesting thing of note that I caught on TV yesterday-
They stated that the Big 3’s major oompetitors (in Japan and Korea, I think they specifically mentioned) do NOT pay health care for their employees- their governments pick it up- and it is NOT socialized medicine.
One of the problems we face is that we are NOT on an even playing field with the rest of the world.
I don’t know about the others (yet) but Toyota is self insured, their government does not pick up the tab, the company does. They just built their own $9 million health facility by their manufacturing plant in San Antonio.
Tim,
I am not clear if he meant Toyota as a whole, or just the parts of the company that is in Japan.
Regardless- I bet owning your won medical facility is cheaper than most insurance!
Kevin,
How is government-funded healthcare NOT socialized medicine?
Robert,
Socialized Medicine is when the government operates health care facilities and employs health care professionals.
If you want to use a broader term- and include when goverment pays for healthcare- well then we are already there- MEDICARE!
Using that analogy-I guess you can say that since the government pays Boeing to make bombers- it is a socialized company.
It appears the American auto industry continues to overlook history. Consumers, out of necessity, are no longer falling for the “Buy American” program. Japan and Korea produce very high quality vehicles that provide about every accessory anyone could ask for. MUCH higher MPG figures and MORE horsepower at a very competitive price AND warranties out the kazoo.
Now, in a burst of stupidity, GM is going to bring back the Camero! The oil companies will love that. Toyota can’t build the Prius fast enough. GM comes out with a rattletrap Cobalt!
Oh yeah…….. lets throw some money at the “Big (Dumb) Three!
John Colgate: I have no problem with GM bringing back the Camaro. It serves (and sells to) a “niche” market and they will actually make a profit on that car. There will always be a market (granted not huge)in the states for Camaro’s, Mustangs, Suburbans, Escalades & the like because there is a certain segment of the population that like them and can afford them. We’re not gonna see a Prius in every garage anytime soon. Especially not mine.
What broke GM and the others is a combination of a lot of things…some (not all) shitty products (hence the market share loss), UAW costs, and lastly, really bad and bloated middle-management that spent money like Uncle Sam (i.e. drunken sailors). GM especially, wastes millions upon millions on wasteful programs and advertising and dealer “support”.
I think they should file bankruptcy, re-group and carry on at the pace they can afford. They’ll need to trim back dealerships, middle-management, product lines, and slash labor costs dramatically (UAW has to go) across the board.
I believe people will buy from American manufacturers during and AFTER a chapter 11 realignment, if they have faith in the brand.
One of the major reasons people have a lack of faith in GM, is the same reason they have a lack of faith in our government. They’ve both been run by morons for decades that simply throw money at every problem. They’ve never solved a problem, EITHER of them, they’ve just COMPOUNDED the problems.
It sounds simple, but clean house and realign and let the market do it’s thing. If you make a product people want at a price they like, NEWSFLASH….they’ll buy it.
Here’s a thought:
Has GM approached Exxon Mobil or maybe Shell Oil about obtaining “emergency funding” to keep the ailing auto company afloat ? With the Oil Industry’s record profits of the last several years, one would think they would have plenty of capital and be more than willing to help out the struggling auto maker by providing low-interest financing. After all , the two industries have kept each other’s best interests in mind for pretty much the entire last century.
What a patriotic and symbolic move it would be to not only the auto industry, but the country as a whole. Too bad the odds of this happening are next to none. I would bet the Oil Industry has learned that producing clever and slick television commercials which portray the industry as being “green” and “environmentally conscious” are a much better investment on swaying public opinion.
I have mixed feelings about a bailout for the big 3
One thing you should keep in mind- 10% of all US jobs are related to the Automotive Industry.
20% of Hoosier jobs!
The effects of a bankruptcy (OR WORSE) would be a BIG BIG problem.
Andy, The oil companies won’t make them a loan for the same reason no one else will except congress, it’s a lousy investment, and it’s throwing good money after bad. It’s a bad risk plain and simple.
The perception has been that the oil companies and the auto industry have been in bed with each other forever but that’s more perception than reality. The oil industry (and all other industry for that matter) is not in the “patriotic and symbolic gesture” business. They’re in business to make money for their shareholders (primarily retirement & pension accts).
If you want to be patriotic, let the automakers dig out of their own mess and clean it up themselves like you and I would have to do. If you can’t steer a 100 year old frickin business anywhere besides the toilet over the last 5 decades, you deserve to fail because you’re frickin’ morons. They don’t need a bail out, they need to get to work, think smart and quit begging for a frickin handout.
They’re looking for the easy way out, and congress is just the body of boneheads to oblige.
Tell them AND the UAW to re-tool, and re-negotiate, and rethink the whole business model, cuz the taxpayers don’t need to be in the auto manufacturing biz.
It’s time to cut bait boys.
Agreed. No more tax money bail out for Auto Industry.
$ The first $25 Billion 2 months ago was more than enough $.
On C-Span…all three CEO’s…
Ford, Chrysler, & GM…each said wait till 2009 or 2010.
America has bankruptcy 11 laws for a reason…to establish new business models current with the changing market environments.
Chapter 11: rehabilitation or reorganization, used primarily by business debtors, but sometimes by individuals with substantial debts and assets;
http://en.wikipedia.org/wiki/Bankruptcy
MSNBC Video:
Should an unprofitable, uncompetitive industry be forced to restructure or should the feds dump a few billion more into the national money hole?
http://hotair.com/archives/2008/11/19/romney-let-detroit-go-bankrupt/
Barney Frank is already warning that the auto companies will need much more than $25 billion, and he’s excited about the government lending it to them in return for more control. I wonder if Congressman Frank and the Democrats are excited about the Fannie and Freddie bailout providing the government more opportunity to control lending?
The main questions about the bailout right now seem to be what will be done with the half of the money that Paulson is still holding, will the Big Three auto companies get part of the bailout, and will there be more bailouts and stimulus packages? The answers: The rest of the money will go where Obama and the Democrats generally want it to go, yes, and yes.
http://veruspolitics.wordpress.com/2008/11/19/tarp-update-and-bailing-out-the-automobile-industry/
I saw an interesting thing on TV last night. A talking head (sorry, forget his name) had roughly this idea:
a. Bail out the auto industry
b. BUT- don’t do it until after they file bankruptcy- instead, use the money to help them change their business model- better, fuel efficient vehicles, etc.
More of an “all encompassing plan” than just handing them money.
Kevin, this will keep you awake at night for a while…That’s roughly what MITT ROMNEY proposes!
Ha!
Why help them on a bailout?? Why can’t these companies stop production? We will never run a shortage on vechicles, look around at all the sales lots, they are not selling these vehicles so why make more. These companies need to look within their company and start cutting expenses, before asking for a bailout. We have all learned to cut back on many of things, they should do the same.
well, in many ways it makes sense to me too. Clearly the way they do business is NOT working.
and yes….I will lose some sleep! ;)
If Congress is too chicken to loan the money, the Autoworkers Union should go on strike and flex their muscle.
All of GM, Chrysler and Fords workers simutaneously would walk off the job. Everything would come to a grinding halt.
That would show the big wigs and the car dealerships whose in charge !
But people would probably go buy a Kia, so forget I even said that.
Why is you ask that American Made products such as Toyota and Honda can make such great automobiles? American workers is why! You really need to quit always blaming the worker for all the problems. When was the last time any Congressman talked to a working man?
And the fact that Japanese CEOS only make 6 times what the lowest paid worker in their company makes. American CEOs make 20-30 times what the lowest worker makes and whom is you have to talk to when you have a problem? Layers of built in protection to keep the bosses away from the little people is what they wanted.
Only 7.5% of the workers in the private sector are unionized. That means 92.5% of private sector workers are non-unionized. How much longer are Americans going to blame unionized workers for every ill in this country?
But I guess it is easier to scapegoat unions than to ensure that all workers are treated fairly - gosh that might require corporate America to actually behave responsibly and ethically toward their employees.
Charlotte sez “How much longer are Americans going to blame unionized workers for every ill in this country?”
I don’t blame them for every ill, just this particular one.
Sorry, but it’s mathematically impossible to pay your workforce that kind of dough and stay solvent unless you’re gonna sell Cobalts and G6’s for $50,000 a pop. I’ve been a GM guy for 25 years and I love the products, but facts are facts, times change and those that adapt survive.
So, Tim, what you are saying is that it is totally the fault of the workers that the auto industries are in trouble?
In 1970 the UAW picked GM as their strike target to flex their muscle. The nearly 60 day strike ended with the UAW obtaining a 14% pay raise and brought them the automatic cost of living increase to their hourly wage. Since then the UAW would obtain hourly increases on top of what ever the cost of living increased from year to year.
This just about destroyed GM and soon after Ford and Chrysler fell in line. Many of the top union brass was quoted in various newspapers that they where prepared to destroy one of the big three if they did not give them what they wanted. They went on to even claim that if one of the three failed the remaining two would soon take over their market share. Hence, their workers had little to fear. Of course the off shore manufactures had not opened plants in the United States and their markets where very small on the two coasts.
The Big 3 had a much larger (GNP) impact on the output of American goods then today. They also indirectly affected more people in the entire total employment of America. Yet, they expressed or showed no concern to those people.
Yet today they are saying if the Big 3 is not handed billions of dollars that the impact to America will be so bad. Gosh, in 1970 they could care less and today they all of sudden care. One has to wonder why? Maybe in a last ditch attempt to protect their $28 a hour wage and some of the best benefits of any production worker in the world might be the answer.
When the UAW ever hit the streets in a strike they showed no concern for the auto dealers and suppliers. Yes, even back in 1970 several dealers closed around the United States that sold GM products. They had no product to sell yet their bills still came due to pay labor, building lease, and so forth. I think, if I remember one union person said in a Detroit Free Press story something to the effect the dealers should have had cash reserves to carry them through the tough times. It was not their fault.
Over the years 1000’s of small suplliers to the Big 3 have folded when they could not cut costs to meet demenaded pricing from the Big 3. Or after a supplier went out and purchased millions of dollars of new equipment to lower part prices that one of the Big 3 did not move the contract for given parts to some other company. Not once did anyone hear the UAW ever stand up and say that was not right. They could have cared less about the business owner and the people working for the supplier.
So please do not come to me and tell me how much the UAW gives a damn about anyone outside of themself. The Democrat talking heads of Congress are so concerned about the UAW workers but have not given little more then a crap about the nearly 700,000 people that have lost their jobs this year.
Does the Big 3 get a pass. Hell No! They are like sports team owners that cry about the high cost of operating a sports team. Yet, they are the ones that shell our $20 million plus to a single player for a single year. They get what deserve.
The only way anyone of the Big 3 is going to continue is either US taxpayers start writing checks for years to come or each must go to court and rebuild themself. Management is way too top heavy, the companies do not spend enough on R&D, shareholders are only interested in dividends, and not one of them have a five and ten year plan of what they will be like. They think in terms of the next quarter profit statement.
The union can either work with them and face the ugly music. They can decide to reduce their entire pay package to something that can work for both sides or face the unemployment line. Keep in mind everyone of the Toyota type plants have capacity to quickly fill the loss of anyone of the three. Be it in building more units here in the US, Canana, or Japan.
In closing the UAW and the Big 3 can get their heads on right or join the junk heap of the old US steel industry and even the Teamsters in the trucking industry. The UAW and Big 3 are still living in the 70’s when they ruled the United States and the earth. Now they are just a player on the world stage and in ten years only be a memory if they do not work with each other.
BTW I am not opposed to providing loans to any of the Big 3 as long as they have a proven plan that passes common sense. That means not what the elected talking heads say but people that know business and see that they have a workable plan to recover. Until then I oppose any loan to any of them.
I am a life time Ford owner.
So $28 an hour is an outlandish wage, J.Q.?
Take a guess at how much occupational therapy assistants make - or nurses - or any number of other professions. Much more than $28 an hour.
Why is it you are singling out the hourly wage of the auto worker when other professions have survived paying high wages? Maybe it isn’t the workers but the management that needs to take cuts and give up salaries.
“Charlotte A. Weybright on November 20th, 2008 11:51 pm So, Tim, what you are saying is that it is totally the fault of the workers that the auto industries are in trouble?”
I’m saying the UAW was/is an ENORMOUS part of the problem. Obviously management was ineffective as well for decades. All the social engineering and cheerleading for collective bargaining will not change the math.
As a manufacturer, if it costs you $20,000 to build your product and the plant next door makes a virtually identical product for $10,000 using identical suppliers and materials, which one will survive? It’s not exactly rocket science.
What you and congress are proposing is letting the taxpayer subsidize tha manufacturing business (just like the morons recently subsidized the banking business) and I for one don’t want us taxpayers in the car biz, the banking biz, the health care biz etc.
We could list hundreds of reasons, and point fingers at labor, management, economy, etc about why we THINK why the big three weren’t and aren’t profitable, but it doesn’t matter now. The plain facts are what I stated, as of today moving forward is simply a math problem.
At one time unions served a noble and worthwile purpose, but just like the government, they grew to become enormous protected bastions of greed, laziness, graft and crime. Not to get too philosophical, but any time any organization (be it a government, a charity, a business, a union, it doesn’t matter) reaches a certain level of participation, the smarter, nastier, greedier, and dishonest faction tends to rise to the top of the management chain. It happened in the UAW, The Red Cross, The US Congress, GM, Blue Cross-Blue Shield, etc etc etc… You can see it in ANY organization, even church hierarchy, but I digress.
The answer to this dilemma is mathematical period.
Charlotte, also…in response to your question to JQ about $28 dollars an hour being an outlandish wage, no it isn’t for skilled labor. It is outlandish though for someone pushing a button or a broom for 2 hours a day out of an 8 hour shift, and it’s especially outlandish to pay that worker 90% of that wage to go home and watch tv while laid off for weeks at a time. That by itself is reason enough to convince any rational person that the UAW contracts are just plain frickin stooooopid.
I grew up in Fort Wayne and had many friends at International Harvester who who took absolute delight in having benefits like that too and when it finally broke IH’s back they all bitched, pissed, and moaned about it but never took responsibility for it themselves.
You reap what you sow.
Tim,
You wrote: “What you and congress are proposing is letting the taxpayer subsidize tha manufacturing business (just like the morons recently subsidized the banking business) and I for one don’t want us taxpayers in the car biz, the banking biz, the health care biz etc.”
the problem is, we are subsidizing the competitors of the big 3.
I found this on the Detroit Free Press website:
As it turned out, Alabama offered a stunning $253 million incentive package to Mercedes. Additionally, the State also offered to train the workers, clear and improve the site, upgrade utilities, and buy 2,500 Mercedes Benz vehicles. All told, it is estimated that the incentive package totaled anywhere from $153,000 to $220,000 per created job. On top of all this, the State gave the foreign automaker a large parcel of land worth between $250 and $300 million, which was coincidentally how much the company expected to invest in building the plant.
You can read the whole article here: http://www.freep.com/article/20081119/OPINION05/81119080
This is not a black and white issue, it is several shades of grey.
Kevin, be fair now….Any state will do that for ANY manufacturer, be it cars, widgets or condoms….What did (and does) Allen county and the state do for the GM plant in Allen County?
Charlotte,
Nurses need a four year degree for what they do and risk exposure to infectious diseases on the job. They deserve what they are paid and more.
Kevin,
What Alabama did was foolish and wrong. Companies exploit states by playing them off against each other. Workers join unions to fight exploitation, the 50 states belong to a Union for the exact same reason. The interstate commerce clause in the Constitution would be grounds for outlawing this practice.
Tim: The point is not that the Camero makes a profit (albeit not much). The point is……. A time in world history when fuel for motor vehicles is beeing consummed faster than this old world can squeeze it out. Why would a good manager allow an industry that is floundering due to poor sales, re-tool for a niche market? I’d love to have the “Ground pounders” of the 60’s back. There’s a old hot rodder saying…Cubic inches equal horsepower.. The problem is… they also equal more fuel consummed. Maybe the folks that can afford to drive the Hum Vees of the highway can use them for dog houses when the wells run dry.
I also love the idea of GM, Ford and Chrysler asking the oil compaines for money. Wonder what the CEO of Marathon Oil drives?
Oh.. and by the way Kevin… What will the state and Allen county do when the GM plant rolls over and dies.
Maybe the city will take it over and turn it into a paintball battlefield?… an ice rink…a flea market?
Hey now, guys. What is nailing GM is the same brand of thinking that’s become popular throughout our economy: A focus on maximizing the current quarter’s P/E at the expense of longer term development.
It’s not that the UAW is such a problem. It’s that Management and the UAW reached agreements with incredible retirement options, long-term health care, and long-term job security. That allowed them to keep lower wages through a boom economy while multiplying their future overhead.
And it’s not just labor. Milking SUV and pickup production for as long as possible was another move for short-term profit. Tooling up for small cars would have been a hit on the balance sheet that no one wanted to see, even when times were good.
Thus, management secures great quarterly bonuses and bails out on golden parachutes. And the lucky ones get out before the consequences of their actions become apparent.
It’s a pervasive cultural problem. We’ve been so prosperous for so long that folks see this ’screw the future’ perspective as a virtue. Somehow I doubt we’ll exit this crisis having learned anything.
John, the 2010 Camaro didn’t take a lot of “re-tooling”. They are using the ZETA platform, which will be the same platform (common parts & chassis) for numerous other GM models…The rest is basically re-skinned, and with a v6 and relatively light in weight, will be pretty efficient and cool looking.
My point is, they make this in the Ontario plant, without changing a thing and they could be profitable, if labor costs fall in line, otherwise none of them will be profitable anyway. The oil wells of this planet will not run dry in my lifetime or my kids, the places and processes of extraction (and price of course) will, but the availability of oil will be around for centuries no matter what Algore sez.
The whole country isn’t broke despite what the MSM sez every single day. We don’t (and WON’T) all buy and drive 4 cylinder shit boxes, period.
And because we have 300 million or so gas powered vehicles on the road, and the only existing way to fuel them all is a gas station, I don’t think that’s gonna change anytime soon.
The big three have management woes, and labor woes, and left to their own devices they will either figure it out or perish. Either one is fine with me. I love my new Suburban but I can adjust to a Sequoya, Armada, or a Benz.
John,
What are you talking about?
I have only said that I have mixed feelings about the bailout- I think that most of my comments SUPPORT a package for the Big 3.
opticsdoug, there is some validity to your theory, but the primary reasons for the situation are still STUPIDITY, STUBBORNESS, AND GREED.
Charlotte,
1- Nurses are a highly skilled trade if you are talking RNs. Not just every high school grad comes close to being able to earn a degree as being an RN.
2- Engineers have 4 year degrees and many have their Masters. Yet starting out more then half earn well under $28 a hour. Yes, some special areas pay more but not most.
3- Most people, including the auto industry that are not part of the union, get a thank you and please do not let the door hit your butt on the way out if you are laid off. Oh, if they are lucky they do get two weeks of comp for every year they worked at some company. So if you work there 26 years you get 52 weeks. Nice, I work for the UAW and get that and more in less then five years.
4- Has the UAW or the Big 3 stated how many of the lower level paid UAW members are working any place in the United States???? The answer is just about ZERO. Plus at current staffing the Big 3 has so many people on layoffs it will be years before anyone new is hired at the lower level.
5- See like it does not matter if I think $28 dollars an hour is fair or not. The working market says the job is only worth $16 an hour. Also the labor market says the old retirement plans and bennie package just does not fly today.
Tonight CNN (I think) had a piece on a guy from near Detroit who had retired from GM with 33 years service. He was worried about the loss of his insurance coverage and his retirement. Which are fair to be concerned about.
Then the story continued the guy owns a small home improvement business. That it was small enough he could not afford health insurance.
Well the guy turned out to be 53 years old.
So he wants me to help under write his health insurance while he works in some other business to help him make more then his retirement brings in. See, that is like a special private tax I pay everytime I would buy a GM product.
If he needs to earn more money then his retirement from GM pays then he should not have retired so damn early. See, some other poor sap who does not have a retirement income to fall back on is trying to run a home improvement business on his own. Yet this guy is trying to take some of that away just to add to his retirement income… Again the UAW workers are a bunch of greed, much like the top management of the Big 3.
As for the states that PAID so much to get any auto manufacture to locate in their state may be in deep trouble. Allen County has been lucky as GM has been here long enough to have paid back more then they ever got several times over.
Look what will happen to SWAC Schools if GM was to shut down. The impact to the township and even Allen County tax incomes. When IH left Adams Township, East Allen County Schools, and Allen County all took a big time hit. I am not sure the township or the school system ever fully recovered from financial hit. The warning is if you want to play with the big dogs then you best be prepared to loose like a big dog in a big way!
We would never had gotten to this point with the UAW if the government would never allowed them to be bigger then any given unit of the Big 3. If the union workers at GM had to compete against the union workers at Ford the stupid wage and bennie package that is killing them today would never have happened. But when the UAW was allowed to drive the bus and decide the path of the Big 3 spelled then end clear back in the 60’s. It was just a matter of time before they drove it off the cliff.
Look at the Teamsters. At one time hardly a truck moved things around this country without a Teamster at the wheel. The union drove a great deal of the safety issues that use to be hazzard to the trucking business. They made some great improvements for the workers and everyone that shared the roads with them. However, they got greedy in their wants for pay and retirement bennies. They could and several times shut down the entire trucking business nation wide in seeking higher wages and better bennies. It got to the place congress deregulated the business and that spelled the end to the powerful union. Had they used their brains or their power they would be much stronger today then the shadow they are today.
Look at the steelworkers. Long before we got into the clean air act the steel business had long left the United States for the most part. Why? A union that kept pushing the buttons of the United States. With a single union they could select which steel maker they wanted to strike and nearly kill with wage demands. Then the remainder fell in line or face a strike that would result in them closing.
The steel business left the United States and the companies and unions have pretty much died.
You can only get so much juice from a leamon. You can keep on putting the pressure on the leamon but there is a point that no more drops will drip into the cup. The UAW and the Big 3 should step back and work with each other or members from both sides will be able to tell their grandchildren about one more American business that is no more.
JQ, very well laid out. I honestly believe most of us think unions and collective bargaining were and are worthwile, and even altruistic endeavors until the power and greed factors take hold.
And it’s not just unions that this happens to, as I’ve pointed out before, any group has followers and leaders and the bigger the group, the higher the percentage of boneheads, thieves, liars, sh&theads etc….
I hate to sound simplistic, but again you can refer back to mathematics and averages. All of society has percentages of liars, murderers, pedophiles, thieves, leaders, nice folks, boneheads etc…The larger the group, be it a union, a work force, a church group, a unit of government, a sports franchise, any group at all, it doesn’t matter, will contain a certain percentage of “bad apples” and if history is any guide, the bad apples usually rise to a leadership position as they are innately driven to control things. It doesn’t necessarily make the whole group bad, it makes what the group accomplishes through it’s leadership bad…
It requires a “house cleaning” of epic proportions.
Tim,
I will agree with you maybe 150%! In general these groups are often “hijacked” by the extreme end. They are the ones who get in your face and shout others down. It never made them right but did make them loud. The average people say, “What the hell!” and set on the sidelines. Like it or not the ones on the sidelines pay the same end result of fate as those who “hijacked” the group.
We often see it in public elections where people promise certain groups of voters things they claim they will obtain for them. Then once elected they roll out a great deal of reasons why they can not secure the very things they promised. The DUMB voters deserved what they got and will now pay for it.
It is just like I set here smiling at the outrage of the Big 3 CEOs going to Washington in their company jets. There are over 10,000 jets and high speed turbo prop planes that are currently owned by American businesses… I also laugh about people screaming about some CEOs making 15-35 million a year as the head of a company employing tens of thousands of people. Yet, many of those same people rush out on weekend to cheer on their sport hero who makes nearly the same and employs maybe 5-10 people.
I have never figured out how CEOs or super stars of sports yank down their money when they do not perform. Then again it is simple. We have people on the board of directors who are clueless when it comes to the CEOs. When it comes to sports teams it is the stupid fans who year after year keep buying tickets even though the owners pay millions to players who don’t get it done.
When the UAW came up with “30 and out” rule that the Big 3 bought into seemed to make sense during the hay day of Big 3. You worked 30 years and could retire as early as 48 years old. You obtained a nice pension and also complete health insurance.
Well the world changed and the UAW and Big 3 never changed. First the UAW/Big 3 want us taxpayers to underwrite their health insurnace for those people. Then they are also supporting the Obama health plan that will five them additional coverage (prolonging their own insurance coverage) at taxpayer cost.
What we fail to address is currently the Big 3 is losing between $400 and $2,400 per unit sold. Taht number has to be reversed. So how is it done. The Big 3 can not pull that from the suppliers as they have beaten them to the point many fail yearly. The only place left is in the labor content. Which means fewer workers remaining to pay for the decades of committed retirement pension funds and health insurance.
There is no longer a hole in the dike but then entire wall of the dike has a huge crack in it. Water is pouring in and soon the dike will fial. The question is not if the dike will fail but the question is when it will fail.
In closing think about this. Congress is asking the Big 3 to develop a SMART plan to bail them selves out within 10 days. You are talking about a plan that covers several years, figures out cost factors, develop factual concepts of what the auto market will be in the years to come. Most companies that are a great deal smaller would take months to prepare such. Yet we are asking the complex companies to do it in 10 days.
What is more crazy is to think people like Nancy and Barny Franks can even understand such, let alone decide on the contents of such reports in a few days.
The Big 3 did not bring a plan with them was not because they are stupid people. It is simple and they know the truth. They have to unload the UAW contract as it is now, do some retooling, and get their advanced R&D going again. Take any one of the three away and they will fail.
Personally, I don’t care what a person makes as long as I’m not paying him. I think sport teams should pay for their own stadiums by passing the helmet around before each game.
JQ…Bingo!! It ain’t rocket science. If you have a McDonalds next to a Burger King, and both have a $1.00 double cheeseburger, life is good. However, if the Mcdonalds has a union and has to pay their employees $20.00 per hour to make the double cheeseburger, common sense says there is going to be a problem, yes??
American taxpayers are not stupid all the time, I think they can see this for what it is. At least I sure hope so!!!
You won’t change my mind on the union issue. As I said, the BLS indicates that only 7.5% of private industry is unionized as opposed to the public sector figure of 35%.
When you raise the issue of training for professions, are you now saying that those with training/degrees deserve more than those who have no training?
Sure, nurses, OTs, etc. receive training, but the required length varies. A PN curriculum is roughly 15 months in length, an OT is about 24 months in length, and an RN degree offers 2-year, 3-year, and 4-year curriculums. To top it off, we also know that allied health field wages are high because of supply and demand, not necessarily because of the amount or length of education involved.
What about sports stars and movie stars who earn millions of dollars a year and have no college education? Are you going to argue that they offer a service. What service?
But you begrudge a union worker who may have no college degree a $28 an hour wage? And all because he or she belongs to a union?
Where is all the hand-wringing about Toyota workers making $43.00 an hour in wages and benefits? Here is a statement from an article from last year:
“Last year (which would have been 2006) was the first time that non-unionized workers at a foreign-owned assembly plant made more than members of the United Auto Workers union make on average in a year. The Detroit Free Press reveals in a very interesting article that Toyota paid out bonuses of $6,000 to $8,000 last year at its largest U.S. plant in Georgetown, KY. Combined with the base pay made by a non-union worker at the plant, that equates to $30/hour or $60,000/year based on a 2,000-hour work year. That is more than the $27/hour or $54,000 a UAW member made on average last year.”
Don’t forget that the colonies “unionized” to break away from England and to protect themselves. That union was created by a group of wealthy property owners who did their best to preserve their own interests, and, I might add, they did that quite well.
As to the example of a Wendy’s and Burger King side by side - perhaps the idea should be to unionize both and that would equalize the cost of the burgers as well as give the workers a decent wage.
I can’t imagine for one second that you believe earning $6.50 an hour with no benefits provides a wonderful living. The use of $20 an hour isn’t necessarily accurate either. Many Indiana state, county, and municipal employees are unionized, and many of them make around $12 - $13 an hour.
A bailout is simply a rescue from financial distress. The mechanics may change, but, in both the Wall Street bailout and the possible Big 3 bailout, the corporations have and will give something in exchange.
My understanding is that the Big 3 will be getting loans. Unless those loans are forgiven at some point, they will be beholden to repay them. Is this any different than your mortgagee working with you, as the mortgagor, if you cannot pay the mortgage?
Perhaps you may not have made some wise choices and you ended up in a situation where you could not make your payments. It is more beneficial to the mortgage company to work with you to find a solution than to let you go into bankruptcy. The major difference is that the Big 3 loan is coming out of taxpayer funds – your restructuring would not.
I will go out on a limb here - but I don’t hear anyone discussing the American public that couldn’t get enough of the SUVs, the mini-vans with everything but the kitchen sink (which I imagine some even had), the gas guzzlers, and the Hummers - just to name a few types of vehicles. What about responsibility on the consumer end of the market as well?
I have heard way too many consumers swear up and down that they just couldn’t manage their kids and all the running that they do in anything other than a monster SUV, van, etc.
By the way, I forgot to mention, I am not opposed to all concessions. I think it is ridiculous to provide an avenue for retirement 10-15 years before the actual government-established retirement age is reached - let alone be compensated for that retirement.
Why would unions want to have their workers retire so early? That only forces them into some other occupation or activity. I guess I believe in working until I kick the bucket or I am forced to stop because of health reasons.
I also think that if plants are closed, the workers should have to go on unemployment at some point just like the average person does.
Charlotte sez “I will go out on a limb here - but I don’t hear anyone discussing the American public that couldn’t get enough of the SUVs, the mini-vans with everything but the kitchen sink (which I imagine some even had), the gas guzzlers, and the Hummers - just to name a few types of vehicles. What about responsibility on the consumer end of the market as well?”
Respectfully, What in the hell makes me (or anyone else) responsible for any of this because we bought an SUV or a mini-van?? Are you out of your mind?
Quit trying to blame everyone else for a failed business model (decades long) that was finally crushed by labor unions. I know it’s normal to want to blame everyone else, but it’s clear. If you want to blame anyone, blame the union.
On the wage versus skill issue, again I think you are either oblivious or a communist. The whole point of higher education, advanced training, specialized degree’s etc is to earn more money in your chosen field. If you simply pay everyone the same, you’ll have a real Marxist society.
I can’t (and never could) warm up the idea of paying a high school dropout $28 an hour ($58,000 a flippin year) for leaning on a broom at GM. It’s almost as ridiculous as the unionized (your figure 35%) utility & highway workers standing around leaning on a shovel at $25 per hour.
If you want everyone to make the same wage, and live downtown on top of one another in like housing (your recent subdivision rant), you’re fighting an uphill battle even in this gilded age of “The One”……..
Damn, I sure miss the USA.
Tim:
Actually, then, you are saying that no one should be responsible except the unions. Not the American public, not the CEOs (who just “rode” into Washington in their jets) - you did say “blame the union.” Blame the unions and no one else, right?
So, I guess your double-standard is acceptable to you. How does that make your rant any different than what you see as my rant?
Sorry, the 35% figure is not my figure - it is from the Bureau of Labor statistics - so you can stop “blaming” me for that one.
You state:
“I can’t (and never could) warm up the idea of paying a high school dropout $28 an hour ($58,000 a flippin year) for leaning on a broom at GM.”
It doesn’t matter if you “warm up” to it or not. Please address the same issue as it relates to the workers at the non-unionized Toyota and Honda plants. Those workers are making just as much or more than the unionized workers at the Big 3.
Does it change your mind at all if the plants are non-unionized and that a worker at Honda or Toyota leans on a broom? Does it matter if the Honda worker has a high school education or is a dropout? Bet you are okay with that, aren’t you?
Again, just another example of your hypocrisy.
Your statement:
“On the wage versus skill issue, again I think you are either oblivious or a communist. The whole point of higher education, advanced training, specialized degree’s etc is to earn more money in your chosen field. If you simply pay everyone the same, you’ll have a real Marxist society.”
You are kidding right? The point may be to earn more in a field, but “life” may not always get that point. You may find people with degrees who are paid less than those with no degree.
Sociology degrees are a dime a dozen. So are English degrees. Just because you have a degree doesn’t mean you will earn more money or even earn what you think you should. Isn’t that the good, old American way?
Is it all unions you hate, or just some? Or does the idea of “union” edge too close to empowering the workers? It seems that empowering workers is something that die-hard capitalists find scary - I guess that is why words such as “socialist” and “communist” come in so handy.
Let me guess, you think there should be no unions and the corporations should just be allowed to do what they want - not that they aren’t doing it anyways.
And, by the way, your tirades are rants to me. I guess it boils down to what is one person’s opinions are another person’s rants and vice versa.
“…I think you are either oblivious or a communist.”
Why is it “conservatives” resort to name calling instead of defending their argument?
Whoa Kevin, I’m not name-calling at all. Her assertion and belief that incomes should be equal regardless of training and educational attainment is right out of Fidel Castro’s play book. Her answer to my example of the side by side Mcdonalds and Burger king where one has to pay $20 as a union shop and the other doesn’t is to simply unionize the the other at $20 bucks an hour also, hence my claim she’s “oblivious” because would have to go out of business, unless of course consumers would pay $15 or $20 for a burger and fries.
Go back and re-read it, my statement is accurate as hell, and my argument is bulletproof. The union killed Harvester and they’re killing the big three. Borrow a calculator if you need to, it’s a relatively simple math problem.
Here are some thoughts
1- Most, but not all jobs, at a Big 3 assembly plant can be taught in weeks. A full blown RN takes years of school and invested dollars in education. Many hospitals now require RNs to continue education levels.
2- A teacher requires 4 years of education to start and rerquires a master degree in many cases in so many years after starting of teaching career. Again tens of thousands of dollars invested up front in education.
3- Charlotte argues for the Big 3/UAW but drives a truck that had the profits of it go back to Japan. She can argue the quality issue and all that but the fact is she did not support the Big 3/UAW.
4- I support unions that represent one on one. That means the one union represents the people within one company. When the union represents an entire industry is wrong. It is nearly like a government running the industry. I site the UAW, the United Steel Workers from years ago, and the old Teamseter’s union that represented nearly all semi truck hauling in the United States at one time. They failed because of self greed and not adopting to the real world we live in.
5- COLA (Cost Of Living Adjustment) automatic pay increases compounded onto contract wage increases makes so sense in the long run. The Big 3 sold out to the UAW in order to avoid a long strike. Not one of them ever was willing to risk a strike to remove this stupid program.
6- When “30 and out” was pushed by the union and again the Big 3 bought into it was with a gun held to their heads. Also the work force of the Big 3 is much older then it was back in the 70’s. Anyone would have seen this nighmare coming before the ink was dry on the contracts. Again the Big 3 refused to see a strike over this issue.
7- It does not make one bit of crap what we think about the $28 a hour wage. The fact is even with in the US the same work is being done at $18 an hour. Then you can go outside the US and it is even less. That is the REAL WORLD, like it or not.
8= No bridge loan is going to work no matter what some may think. The fact is unless we taxpayers underwrite forever the Big 3 will have about 3 times the number of retired people depending on the labor rates on a great deal fewer. Everytime the cost of living goes up 5% for the worker will mean it will have to go up about 20% to cover the retired workers as well. A person retiring with the 30 and out rule could well live 30 years on the Big 3 retirement plan.
9- If the Big 3 could easy cut a thousand dollars out of each unit they would have done it a long time ago, if nothing esle to give it to stockholders. Keep in mind if they could cut the thousand dollars they would only be to be at break even costs. No profits still would be around and hence advanced R&D and shareholder dividends would still not be present.
10- UAW workers like to talk about the CEO’s of the companies on Wall Street who rode off into the sunset with millions of dollars. But they don’t mention the office workers, cleaning help, and the other common people who got laid off with nothing. They are trying to make it on unemployment comp and that is it….
11- Since the slowdown suppliers have closed operations right here in Indiana. I never heard from or seen a letter in the Letters to the Editors about one UAW member giving a crap about those people who often made $10 bucks a hour or less. They are the forgotten like the trash we put out for grabage pickup. I did not see any posts from those here supporting the bailout in helping them out.
I will say again if the UAW lost the contract for the Allen County plant and GM decided to hire new employees at $15 an hour there would be tens of thousands lined up to take those spots.
The UAW has lived for 40+ years holding a gun to the Big 3 heads. If they want they can pull the trigger as the Big 3 is already in a comma and death is only one step away.
As for Obama’s buddy Warren Buffet coming out and supporting a bailout… Now that is interesting as this is the same guy who has a 10% interest in a China automaker of a elctric car that is suppose to sold in the United States in late 2009 or 2010. That sure helps the Big 3 with one more company coming in to divide the auto sales pie up.
In closing just cutting wages/bennie package is not the sole cure. The management makeup of the Big 3 needs sweeping changes. From my reading Chrysler and Ford is well underway in doing so but GM is hardly started.
Again go look at the board members of Ford and GM and see how many of them do you honeslty feel can set in a board meeting and give a CEO good direction on running those companies? Many lack any large business background, lack world trade background, lack talents in understanding what it takes to design new products, and have little undertanding of dealing with massive number of employees.
Yes, I do believe the Big 3 can be saved. It will take the courts to do it. They will force new board of directors, new managment systems, and the unloading of the UAW contract as it is now. If you miss any of the three items then they will die and they only have themselves to blame.
Wow Tim - you are not anywhere near bulletproof in your argument. You are arguing that it is okay to pay the workers at Burger King and McDonalds (or whatever) at $6.50 an hour to keep the price of your hamburger low.
But if the workers of the one business decide to organize and then maybe - just maybe - the workers of the other business decide to organize that is an example of communism? How far off can you get?
I mention that an alternative is to unionize to provide better wages in both places - then I am a communist?
You are okay with low wages so you can gulp down your quarter pounder, but God forbid that the workers would organize to get a better wage - thus driving up the cost of your ‘burger.
Either alternative is an option, and it certainly doesn’t make me a communist. And it certainly doesn’t make you right. If workers want to organize to better their lives, then more power to them. And if others decide to follow suit, then great.
Again, I will ask you - what is it that you have against unions, in general?
J.Q.
Apparently you didn’t read my follow-up post. I said that there are areas where I don’t agree with the unions.
Yes, I own a Nissan - built here in the U.S., which helped pay the wages of American workers. The profits go back to Japan. Do you suppose American investors own stock in those companies?
Of course they do - so even if the profits go back to Japan, American investors/shareholders make money.
I have owned a number of American made cars - Ford Escorts, Pontiacs, Chevies as well as foreign made vehicles.
I don’t have to own an American-made auto to support unions. How many products do you buy each week that do not support American workers? Look at the labels on almost anything you buy anymore, and it will say “Made in” - insert the foreign country.
So go ahead and criticize me for owning an American-made vehicle whose profits go to another country. But until you buy all of your products that say “Made in the U.S.A.”, you don’t have a valid argument.
Supporting unions is distinct from the purchase of products. I support unions wherever they may be. But because of bad free-trade deals and heaven knows how many other rip-off free-trade deals sought by the corporations, we now are relegated to buying products from virtually every country in the world other than the U.S.
I challenge you to go out shopping and find a cart-load of products in one outing that say “Made in the U.S.”
Of course many professions take a lot of money to accomplish the training. That doesn’t mean that those individuals will make a ton of money.
Sociology degrees are plentiful which drives down the wage; nursing degrees are valuable because of the pressing need. But a sociology major puts in four years of education as well as the nurse.
I can almost guarantee you that the sociology major probably doesn’t make as much as a nurse, yet they both have put years of their lives and thousands of dollars into their educations.
Inequalities exist as to those with education and those without education. So what is your point on that issue?
Charlotte: The hamburger example was meant to be a metaphor of sorts. Skip the metaphors, just buy a calculator.
I intimated you made communist suggestions regarding your belief everyone should be paid the same regardless of their education or skills.
You totally misinterpreted my comments, but that’s fine. I’m convinced no amount of common sense, facts and figures or blatant examples will ever change democrats’ blind loyalty. One need look no further than this post to witness first hand this phenomenon of tossing out comments and back-pedaling…I’m not gonna go back through all your inane statements and correct them one by one and cite examples, I have not the time nor inclination.
At any rate..
What I have against unions in general:
1.They encourage something for nothing mentality.
2.They encourage protectionism which makes employees “untouchable” much like “tenured” professors.
3.They drive companies out of business by requiring ridiculous demands (like 85% pay when you’re not even working)
4.They drive prices for products through the roof forcing everything you buy to have a “made in China” stamp on it.
5.They intimidate the bejesus out of non-union employees
6.They run their union “business” like a mafia.
7.They foster an attitude that it’s “us against management”, completely opposite of the succesfull automakers like Toyota, Nissan, Subaru, and BMW in The United States, using U.S. workers, who don’t WANT a union, they like being part od a succesfull team.
You can’t make a convincing argument for the positive aspects of a union anymore, because there are none. Unions were formed to protect workers from unscrupulous employers that would jeopardize your life with bad working conditions. Unions fought hard for a safe workplace, then turned around and became 5 times the graft ridden entities the corporations were.
Unions are obsolete, they are a relic, they are bad for business, and they are bad for employees.
Well, Tim……… You may very well be right..”The oil wells of this planet will not run dry in my lifetime or my kids, the places and processes of extraction (and price of course) will, but the availability of oil will be around for centuries no matter what Algore sez.”
At some point in time (maybe shorter that any of us think), the Chinese are going to be the greatest consumer of oil on the planet. This has nothing to do with Al Gore or the Camero (we’ll see how many 6 cylinder models fly off the dealers lots). When the Chinese decide the need more oil they will have all the money they need to buy off the Saudis, the Iranians and probally the Alaskans. If that fails…. it’s gonna be a long, bloody war!
Tim:
You said:
“I intimated you made communist suggestions regarding your belief everyone should be paid the same regardless of their education or skills.”
Apparently, you haven’t figured out how to read yet. I did not state a belief that everyone should be paid the same. I really am not sure where you came up with that “inane” assumption. If I misinterpreted your comments, then you must not have explained yourself very well.
I gave examples of people with higher education not being paid the same. How on earth does that support your metaphor that I believe the communist principle of “everyone being paid the same?”
No need to go back - your viewpoint is your viewpoint. You are certainly entitled to it, and I am entitled to see your beliefs as inane and unsupported.
By the way, talk about tossing out comments - any support for your statement “unions then turned around and became 5 times the graft ridden entities the corporations were?”
I mean that is pretty specific, so I assume you have figures to back it up.
Kevin:
“What are you talking about?”
I guess my point is…The taxpayer dumpped millions in the GM plant in Allen county. Someone on the business side of the auto industry (doesn’t matter wheather it was union or management) made really crappy decisions on what was best for the industry. Now the taxpayer is being asked…no, not even being asked…told we are going to need to cough up more tax money to keep the Lears and Gulfstreams flying.
Isn’t it just possible that if the “Big Three” go bankrupt, the CEOs will increase their efforts to modify their business practice?
Charlotte,
I have owned only American (only one was Canadian assembled) made Ford products but for two times. Those two times where GM products.
My major hand tools have all been Craftsman tools starting back in the late 60’s.
My power wood working tools are all American made.
Some small clamps and so forth are NOT American made because no USA company made such. But the great deal of small tools carry MADE IN USA on them.
Outside of cheaper clothes like T-Shirts and so forth have been American made. However, over time that has become harder and harder to do.
Do I walk on water because I try to buy American products. Heck No! But I have always been willing to pay a little more for American made products.
I will site you a case right here in Fort Wayne where a shop of over 100 people had a union. The contract came to an end and the national union talked them into hitting the picket line. So they did…. They walked the picket line for nearly 3 months and then the national guys came in and told them the best they could do is what was offered to them in the first place. The local people wanted to remain on strike to demand more but the national guys said they could, but the national union would no longer be supporting them… Nice union…
Charlotte, you made a perfect point. The various degrees are worth incomes based on needs. Free enterprise states what a degree in a given field is worth. Few of us could be a doctor who operates on the brain and they make a ton of money. Good for them…. Northeast Indiana turns out a bunch of teachers because of Ball State and such. It often takes years to land a full time teaching job here. Yet, other parts of the country is in dire needs of teachers.
Spin it anyway you want… The overhead rate for non-union auto production is in the 40-50 dollar class verus the UAW overhead rate is 70-80 dollar. Spin it anyway you want but until the UAW overhead rate comes close to the 40-50 rate the Big 3 can not produce nearly the same cars for the same price.
The UAW national leadership has bled the Big 3 to near death and now they can either provide the Big 3 with some blood or die. The other blood must come from a new board of directors and senior management. Everyone from the Union to the CEOs of the Big 3 lost their way decades ago. They all can get REAL about the world we live in or fade away like the great steel mills that once employed tens of thousands Americans in good paying jobs.
In closing I find it interesting that no one is speaking up for the people who are not in the UAW who have already paid a great price in the loss of their jobs. Again, they must be some kind of second class citizen who belong on the great heap of waste…
“unions then turned around and became 5 times the graft ridden entities the corporations were?”
I mean that is pretty specific, so I assume you have figures to back it up.” Surely, you jest, you must have waaaay too much time on your hands.
Charlotte, I enjoy a good argument, so please don’t be petty, I could have said “100 times” or “2″, times, the inference was plain.
Suffice to say, It’s probably a “given” that the graft and dishonesty may have started becoming an issue with…uh… what was his name again??
Oh yeah, Jimmy Hoffa.
Believe what you want and argue what you want, but as a word of advice, try arguing the big points instead of nit-picking metaphors and obvious “hypotheticals” and generalizations. It doesn’t exactly add any cred to your argument…
J.Q.
Apparently Craftsman power tools are now imported. Their hand tools are still made here.
http://www.stillmadeinusa.com/tools.html
Almost all of my power tools and large power equipment pieces are Craftsman. I have a couple of Black and Decker, but other than that, I have always favored Sears tools.
In shopping in many stores such as Lowe’s, Home Depot, Joanne Fabric & Crafts, Sears - craft items, garden items, etc. - the product will say made in some other country.
J.C. Penney had the nerve to start a line of products called “American Living”, but most of the labels say “Made in China.”
I do look at labels when I shop, and I have found it very difficult to find items with “Made in the U.S.A.”
I have never heard of half the brand names for electronics, TVs, etc.
Tim:
I mentioned your statement because here is what you said in reference to my comments:
“One need look no further than this post to witness first hand this phenomenon of tossing out comments and back-pedaling…I’m not gonna go back through all your inane statements and correct them one by one and cite examples, I have not the time nor inclination.”
Did you not accuse me of “tossing out comments and back-pedaling?” How is it I am being petty when I call you on your tossing out comments, but you are not petty in your eyes when you do it?
Too much time on my hands? I wish. Then I could get more work done on my home.
Yes, I know many Craftman tools are imported. I have not bought any of them. In fact I think it has been 3-4 years since I purchased a major tool.
High volumen electronic items made in Japan employ few workers. Entire production lines are automated. However, there are tens of thousands employed in the design and building the automation equipment.
In part this business was lost here in the United States was manufactures could not get their stockholders or banks to support such major capitol that would take 5-9 years to payback. Japan does not live by this thought process.
Also Japan and other countries obtain tax breaks for money spent on R&D. They see them as future investment for the companies, employees, and communities.
Some parts of the world see having 100 people employed over none as good idea. They would rather see an industry automate so only 100 employed over loosing all the production to some company in some other country.
Just like our EPA standards. We went from one extreme of dumping everything to the other with no middle ground. To get to the middle ground involves years in court and appeal process. It just is not worth the time to fight the legal battle. The company will just go south of the border or some other country.
Here in the United States equipment has to be designed so it can produce current and possible future products. Hence, more labor is required to produce the products and thus the cost goes up higher.
There is a company here in Allen County that produced a fairly simple assembly. China jumped into the market with a product not even equal to the company here. Customers admitted such but said the cost was such they could AFFORD some junk parts and make more money then using the local product.
The local company had 11 people required to assemble the product. Under contract a company I worked for reduced the number of employees required to assemble the equipment to one person. Also the daily production was higher and quality was even higher.
The company ordered three of the machines. Within a year they ordered two more machines. What happened is they could reduce their price to that of the China parts. Plus other companies started to order the assembly for their use.
So 25 people ended up being laid off but 5 kept their jobs. However, with the free floor space the company was able to start producing new products in the following year. So within two years the number of employees went up 75 people.
Look at McDonalds. It was 30 years ago and you would walk in and out in a minute or two. Now you can spend five or minutes waiting on your order. Why? Because McDonalds wants to be the end all place and has a huge menu. People can order custom sandwichs. All of this slows down the process and ends up reflected in higher labor cost per unit sold.
Now look at taxes… Why has the Big 3 left the state to build new buildings all over the United States. They walked away from buildings in Michigan that could be refitted for production of new products. They had local suppliers they worked with for decades. But they elected to move because of state and local taxing. Michigan got greedy on the backs of the Big 3 to the point they had to leave.
I see the lack of flexibility as the bigger problem with unionized workers, rather than high wages.
I worked at a local (non-unionized) factory for ten years, and during that time I worked in just abiout every department there. I would stay late or come in early, I would even ocassionally bring in tools from home to get a job done. Twice, I was shifted to a new department as my main area of work. When my boss asked if this was okay, I just responded “I work for the company, and I’ll go where the company needs me.”
With unionized labor, this type of flexibility often does not exist. Now I am not talking about the company being allowed to work an employee 80 hrs. a week or certain other extreme changes without the employees consent. But when the machine you are working on breaks down, I think it is perfectly acceptable for the company to ask the employee to work on something else while repairs are being made, rather than just taking a paid break.
I have heard many stories from a person who works as a mediator, and this is apparantly how the biggest unions (such as UAW) operate. And that kind of inefficiency is what is killing our auto industry.
I’m a simple person. Really.
1) I’m a consumer. I will buy things that are affordable and have the quality I am looking for. I don’t expect perfection but I do expect consistency.
2) I bought a car one time from one of the big three - brand new - and could not dump it fast enough.
3) Look at all of the businesses in the U.S. that exist without a union presence. Is anyone going to say that most American workers are at a disadvantage by not being unionized? Of course not!
I’d like to understand what Union organization exists (in the U.S. today) that really addresses the things that workers might really need protection/representation on.
Otherwise - ship off the Union model to the third world countries - to protect those who work in real sweatshops.
4) I continued to be appalled by the bailouts sweeping the country. When are we going to start using Monopoly money because really - isn’t that all we have left?!
5) It’s amazing to me that the big three are reconsidering all of their luxury jets - probably in a show of - see - we can be humble.
6) The fact that we are now going to bailout one of the most non-consumer friendly banks in the world - Citigroup - is outrageous.
sigh
Someone wake me up when all of this is over. I may just jump in bed and hide under my comforter until it is all over.