The auto manufacturers are looking at an underfunded pension debacle that has been brewing for year. Read this NY Times article from 2005:Here’s how union members made the difference in last night’s big win.
* Union voters supported President-elect Barack Obama 67 percent to 30 percent over Sen. John McCain. In the top-tier battleground states the difference was even more stark, with union members going for Obama 69 to 28—a 41-point margin.
* While McCain won among voters ages 65 and up, active and retired union members older than 65 went for Obama by a 46-point margin.
* While McCain won among veterans, union veterans went for Obama by a 25-point margin.
This was writen three years ago. Now fast forward to 2008. Nothing has changed except all the strings have come off the public purse.The End of Pensions
By ROGER LOWENSTEIN
I. THE LATEST FINANCIAL DEBACLE
When I caught up with Robert S. Miller, the chief executive of Delphi Corporation, last summer, he was still pitching the fantasy that his company, a huge auto-parts maker, would be able to cut a deal with its workers and avoid filing for bankruptcy protection. But he acknowledged that Delphi faced one perhaps insuperable hurdle - not the current conditions in the auto business so much as the legacy of the pension promises that Delphi committed to many decades ago, when it was part of General Motors.This was the same fear that had obsessed Alfred P. Sloan Jr., the storied president of G.M., who warned way back in the 1940's that pensions and like benefits would be "extravagant beyond reason." But under pressure from the United Auto Workers union, he granted them. And as future auto executives would discover, pension obligations are - outside of bankruptcy, anyway - virtually impossible to unload. Unlike wages or health benefits, pension benefits cannot be cut. Unlike other contracts, which might be renegotiated as business conditions change, pension commitments are forever. And given the exigencies of the labor market, they tend to be steadily improved upon, at least when times are good.
For the U.A.W., Miller noted forlornly, "30 and Out" - 30 years to retirement - became a rallying cry. Eventually, the union got what it wanted, and workers who started on the assembly line after high school found they could retire by their early
50's. "These pensions were created when we all used to work until age 70 and then poop out at 72," Miller told me. "Now if you live past 80, a not-uncommon demographic, you're going to be taking benefits for longer than you are working.That social contract is under severe pressure."
What does this buy us, the people who are stuck paying for it? We get to support UAW janitors and lawn mower jockeys who make $65 an hour.“Alan Reuther, legislative director of the United Auto Workers, said in an interview that the group is proposing lawmakers approve up to $25 billion in new loans for General Motors Corp, Ford Motor Corp and Chrysler LLC. Reuther said the aid would cover pledged contributions to a retiree health care trust, the Voluntary Employees Beneficiary Association [VEBA], which was negotiated last year with the companies.”
On top of that, the Holy One of Chicago will seek to enforce an open ballots law where union officials can look over your shoulder when you vote on whether or not to create a union shop.According to the National Review:Massive job cuts at General Motors, America's largest carmaker — coupled with the bankruptcy of Delphi, America's biggest autoparts maker — have provoked predictable handwringing from liberal pundits who worry that America is "losing its manufacturing base." But the wrenching change now buffeting the auto industry defies the usual press formulas. Just listen to Steve Miller a turnaround specialist who is steering Delphi's restructuring process. He exploded the myth of America's "endangered" union manufacturing jobs at his October press conference announcing Delphi's move into Chapter 11: "We cannot continue to pay $65 an hour for someone to cut the grass and remain competitive."
Take grass cutting. As defined by the current United Auto Worker contract negotiated with the "Big Five" (GM, Ford, Chrysler, and top parts makers Delphi and Visteon), an auto "production worker" is a job description that covers anything from mowing grass to cleaning the toilets. In the real world, these jobs would be outsourced to $8 an hour, no-benefit wage earners, but on Planet Big Five, these jobs get the same wages as any auto line-worker: an average $26 an hour ($60,000 a year) plus benefits that bring the company's total cost per worker to a staggering $65 an hour.
But at least the grass cutters are working for their pay. The UAW contract also guarantees that 12,000 autoworkers get full wage for doing nothing. On the heels of Miller's straight-talk, the Detroit News reported that "12,000 American autoworkers, instead of bending sheet metal, spend their days counting the hours in a jobs bank." These aren't jobs. And they certainly aren't being "lost" to China."We just go in (to Ford's Michigan Truck Plant) and play crossword puzzles, watch videos that someone brings in or read the newspaper," The News quoted one UAW worker as saying. "Otherwise, I've just sat."
Yuppers, now there's a changey hope for you right there. Payback is a gold plated bitch when you're the one footing the bill. My thanks to all you who just helped create the Union Thug Entitlement Program.Legislation that would make it more difficult for workers to hold a private ballot vote in unionization drives, which critics say would lead to harassment and intimidation, has spurred a pitched battle between powerful labor unions supportive of Sen. Barack Obama and big business in the presidential campaign.
Seen by the AFL-CIO as a way to boost union rolls by hundreds of thousands of new members, the hotly-contested bill has become this year's No. 1 election issue for organized labor. Mr. Obama, the presumptive Democratic nominee, has promised union bosses that the Employee Free Choice Act will become law in 2009 if he wins the presidency in November.
"We're ready to play offense for organized labor. It's time we had a president who didn't choke saying the word 'union.' A president who strengthens our unions by letting them do what they do best: organize our workers," Mr. Obama told the AFL-CIO in Philadelphia on April 2.
"I will make it the law of the land when I'm president of the United States," Mr. Obama told the labor federation.
No comments:
Post a Comment