Unions and the Big Three

[TeknoAXE]

On a Christmas drive, my dad and I were throwing around current events and politics and economics (my dad has his masters in economics) while maneuvering around in snow. When the conversation turned to the bailouts, I admitted to my dad that, really, I've come to want the big three to just fail. Just outright collapse and make way for whatever to replace them and hopefully replace them with better business practices and, ultimately, better automobiles.

He responded that we have a democratic president coming into office this year that will, most likely, play very closely to union demands. Therefore, there will not be any sort of thought towards my line of thought, because that would jeopardize many people entrenched in union politics. He's probably right. After all, unions contain, on the surface at least, many of the ideals that democratic party mantra promote: higher pay for unskilled workers, voting power in the company union members work for, etc. It looks like socialism in a neat little container.

Unions have been on the decline since the 50s, when 35% of the United States total workforce was around 35%. Now, according to http://www.unionfreeamerica.com/, that percentage has fallen to just 12%. But unions are deeply entrenched in the auto industry, and many have come to the conclusion that the collapse of the big three is due, in part, to the effects of unions in their ranks.

http://www.businessandmedia.org/articles/2008/20081203145625.aspx

In the link above, there is commentary about how the unions have set the stage for the big three to collapse. This may seem like a rushlimbaugh.com sort of site, but watch the video that's posted from NBC in the middle of an article. Unskilled workers at big three plants cost around $73 dollars an hour in pay and benefits. http://www.cnsnews.com/Public/Content/article.aspx?RsrcID=39499 In comparison, Toyota plant workers cost around $47 dollars an hour. And, when workers are laid off, they still get paid even when they aren't working.

Unskilled labor being paid this much, I believe, not only hurts business practices, but also kind of serves as incentive not to promote our engineering/science programs, which have faltered so much that the government put out a "smart grant" to the colleges, paying students an extra 2 grand for people in these programs. I graduated with and electrical engineering degree, and by comparison, I make about $26 per hour. I mean, why get a college education when you can just join a union and get paid ridiculous amounts of money putting a window into a car?

In short, unions need to die. They need to die quick.

[HexRei]

I doubt McCain would have done anything differently regarding that. Mainstream Republican party ditched the fiscal conservatism angle a long time ago. Keep in mind that the prior bailouts happened under Bush's rule.

[burnt]

dude, pretend open heart surgery started out as a great, awesome, excellent medical procedure that saved thousands of lives...

but then it became over-saturated with hospital politics and bureaucracies and expenses that left the civilians/patients hurting worse after their treatment, while simultaneously putting hospitals/HMOs in debt.

now pretend that there's no viable alternative.

would you advocate banning open heart surgery?

unions are a necessary evil, created because of the evils of corporate/executive greed.

the problem with the "Big 3" is just as much a problem with bloated, overpaid and under-performing executives and media/advertising/PR divisions sucking up profits. and its just as much a problem with the "Big 3" over-extending their shares for quick profits, and selling those shares to greedy shareholders who got itchy and nervous and became quick sellers instead of long holders.

that new $50,000 Dodge SUV is coated in fiberglass and plastic, not wood and steel, and yet it still costs $50,000. it costs $50,000 because... of lazy unionized $50/hour employees half-assing their way through the process of making an SUV but also because... of multi-million dollar super bowl ad campaigns that do nothing to affect buyer behavior... and because of finance departments demanding a bloated sticker price so they can pay off all the "shorts" expected to buy then quickly sell the company's stocks.

if we are to ban unions... we need to simultaneously ban the concept of stocks and shareholders.

how about this instead - how about we overhaul the currently broken system so that, once again, it becomes as great as it used to be? now - I don't know how to do that but - dude - you have to recognize that our cars became significantly cooler and stabler and that we churned a fuck of a lot more of them out.... right after the Big 3 allowed the unionization of their industry.

don't kill the unions. fix the unions. because executives still suck, across the board. look no further than Enron and AIG. we still, unfortunately, need unions.

[TeknoAXE]

I doubt McCain would have done anything differently regarding that. Mainstream Republican party ditched the fiscal conservatism angle a long time ago. Keep in mind that the prior bailouts happened under Bush's rule.

I don't agree with Bush's bailout at all. You know I finally got an ounce of common sense in my dad regarding cars. He usually goes for the American brand cars, but way back in 98, I talked him into buying a Nissan Sentra rather than the American counterparts on the lot. And that thing lasted him until it got totaled in an accident just three years ago. Then he bought a mercury sable for my mom and himself that was fairly new and it tanked on him more times than the sentra had maintenance issues. Now he's driving a Toyota minivan. I'm so proud of him.

[HexRei]

Unions should not die. Unions are a big part of what saved american laborers from the robber barons of the 18- and early 1900's. Let's please note that there is no legal requirement for the big 3 to hire out of unions, either. If they can't cope, let the Big Three die and be replaced by more efficient businesses. As burnt said, unions are a necessary evil.

Also, I'd like to point out that the big execs at these companies are pocketing WAY more money than any union employee. Let's get rid of them.

and good for your dad. buy the best product, not the most jingoistic one.

[TeknoAXE]

Unions should not die. Unions are a big part of what saved american laborers from the robber barons of the 18- and early 1900's. Let's please note that there is no legal requirement for the big 3 to hire out of unions, either. If they can't cope, let the Big Three die.


Unions don't serve that purpose anymore. The bosses at the top of the unions don't represent the people that work for them at all. Not that those who work for the big three have any room to complain.

Also, I'd like to point out that the big execs at these companies are pocketing WAY more money than any union employee. Let's get rid of them.

No disagreement there. If there was any bit of fair business practice going on with these companies, there would be more automobile businesses in America making better cars.

[burnt]

still I think Matt's dad has a great point.

powerful left wing politicians are very beholden to powerful unions.

the Big 3 aren't going anywhere... and I that honestly annoys the shit out of me.

their businesses should go to shit... the employees should pack up and move to Arkansas and get a job at Toyota... and up-and-coming executives should learn a powerful lesson from all of it.

but I just don't see that happening...

[HexRei]

Unions don't serve that purpose anymore. The bosses at the top of the unions don't represent the people that work for them at all. Not that those who work for the big three have any room to complain.
I don't understand why you think union bosses aren't representing their constituents when the gist of your argument is that union workers make too much money. It seems to be that they are doing the best they can to get their constituents the most compensation, which is what they are supposed to do. The problem is, the Big Three are unable to cope with the situation effectively. Unions aren't illegal in Japan, you know, and any sort of legal restriction on them in America would be an egregious violation of civil rights. Imagine workers getting arrested for grouping together to protest unfairly low compensation- that's what you'd be facing.

Your dad does have a point that Obama will probably continue the bailout, but like I said, so would McCain, just for different reasons.

[TeknoAXE]

how about this instead - how about we overhaul the currently broken system so that, once again, it becomes as great as it used to be? now - I don't know how to do that but - dude - you have to recognize that our cars became significantly cooler and stabler and that we churned a fuck of a lot more of them out.... right after the Big 3 allowed the unionization of their industry.

don't kill the unions. fix the unions. because executives still suck, across the board. look no further than Enron and AIG. we still, unfortunately, need unions.

How do you fix the unions? Convince those working for the Big Three that they need a pay cut? Perhaps if we replace "Unions" with "Contractors", the deal would be better because there would be incentive to make better product at a cheaper product so the contractors could keep their jobs.

[TeknoAXE]

I don't understand why you think union bosses aren't representing their constituents when the gist of your argument is that union workers make too much money. It seems to be that they are doing the best they can to get their constituents the most compensation, which is what they are supposed to do. The problem is, the Big Three are unable to cope with the situation effectively. Unions aren't illegal in Japan, you know, and any sort of legal restriction on them in America would be an egregious violation of civil rights. Imagine workers getting arrested for grouping together to protest unfairly low compensation- that's what you'd be facing.

Your dad does have a point that Obama will probably continue the bailout, but like I said, so would McCain, just for different reasons.

I did paint an interesting paradox, didn't I? On the money front, the union bloats their workers like pigs. But on the politics front, I don't think the unions actually come through at all.

[budaho]

what i don't get is why nobody is calling the auto companies on the bull shit claim they keep making that it's their legacy pension and health care costs that are making them uncompetitive. this is cooking the books, its fraudulent and i can't believe they've all but gotten away with it.

today's autoworkers have already made a whole string of concessions dealing with their own pensions.
the big 3 are essentially saying that because they've got to pay their current employees plus pay for the pension and health care of their retired employees that their employment costs are almost double that of their competition. But this is bull shit, because today's autoworker IS NOT working to pay for the pensions of the retired auto workers. The retired auto workers payed for their pensions with their labor when they were working. The big 3 used that extra cost at the time to justify charging higher prices for their products, they used it to claim higher costs of production to their stockholders. They should have put this money in a trust at the time that guaranteed it would be there when those workers earned it. If they didn't do that and are now claiming they don't have the money to pay it then that is FRAUD. they outright spent those retired worker's monies on other things, they stole it.

they big three have essentially been running a scam not too unlike that of madoff. they basically been using current employees labor to pay retired employees pensions so that they can use the money that should be going to their current employees pension funds to pay dividends to stock holders.

but while this is just a fraudulent as the ponzi scheme run by madoff, somehow i'm guessing the auto industry's worked out loopholes that make their thievery technically legal.

[budaho]

How do you fix the unions? Convince those working for the Big Three that they need a pay cut? Perhaps if we replace "Unions" with "Contractors", the deal would be better because there would be incentive to make better product at a cheaper product so the contractors could keep their jobs.


other direction. you give them more of a voice in the management decisions of the company, and more of a stake in its success or failure (ie stock options)

[burnt]

other direction. you give them more of a voice in the management decisions of the company, and more of a stake in its success or failure (ie stock options)

thats what I was gonna say. everybody knows and complains and jokes about how contractors do half assed jobs and drag their feet to extend their paychecks as long as possible. this is a fairly legitimate stereotype whether we're talking about houses or computer networks. automobiles are scary, they're dangerous... its a REALLY scary idea to me, to even consider hiring a bunch of temps to assemble them.

temp agencies do a shit job of locating employees anyway. we all know this. they get a commission every time they send a warm body to fill a vacant position to one of their clients. and they do a halfassed background check. and they pressure people to take jobs they're not qualified for. lol I remember walking into one job ... I had a systems/network background, totally hardware and TCPIP based ... walked in to be a "programmer" because the lady at the temp agency said "well but so that you means you're good with computers right? they just need you to write computer programs..." - lol ...

I think one of the core problems with our auto industry is, we make overpriced shitty cars that nobody wants to buy. so... I mean... if taxpayers invest in this and we keep high-priced executives in the design chair, and we just fill the factory line with tweek-snorting temp workers... won't we just be manufacturing like, way shittier cars? who's gonna want to buy that? not me.

give minimum, get minimum. the unions need an overhaul, sure, but if you get rid of them the quality is gonna drop even further. I mean I guess it'd be an interesting experiment to see just exactly how shitty Ford cars can actually get but I'd rather fix the broken business. ;)

[Roddimus]

How do you fix the unions? Convince those working for the Big Three that they need a pay cut?
they have and probably will. auto unions made big salary concessions during the last industry crisis in the 80s.
unions weren't the ones designing and developing the shit SUVs and shit cars the big 3 have been pumping out for the past 2 decades. unions weren't the one making marketing and quality choices that ran contrary to market demands for years.
but go ahead and blame the unions all you want, since they support the democrats and all.

[dj heavyweight]

73 dollas an hour for auto workers is pure corperate propaganda. MOST UNIONIZED uaw LABOR IS HIGHLY SKILLED. unions promote apprenticeship and training. UAW workers make on average of 25-28 dollars an hr on their check while rat auto workers make between 20 and 25 for the same work. only 3-5 an hr differance. do you think 3-5 dollars an hr is the differance between gm winning or loseing? no, its the corerate jets, the 20 million doallr bonuses paid to execs. its also the fact that gm and ford build shitty cars that noone wants, yea everyone wants a ford or chev truck...but honestly how many ppl can afford a 50,000 dollar truck? not many.

that 73 or 75 an hr figur comes from medical costs, pensions, and also accouns for non working ppl such as the retirees. toyta has but 1000 american retirees while the big 3 have..well...alot more...hence them paying legacy. but what do you expect when youve been in business 100 years where as toyota has only been in the US less than 30.

[dj heavyweight]

they have and probably will. auto unions made big salary concessions during the last industry crisis in the 80s.
unions weren't the ones designing and developing the shit SUVs and shit cars the big 3 have been pumping out for the past 2 decades. unions weren't the one making marketing and quality choices that ran contrary to market demands for years.
but go ahead and blame the unions all you want, since they support the democrats and all.


yea blame the working man....we have weekends, health care, 8 hr days, etc. thanks to labor unions.

[B_tech]

The point, Heavyweight, is that unions were created to protect the worker... with all the state and federal laws to protect the worker, they are obsolete today. The only thing they do is drive up production costs, stall production when they demand things from employers and cause disdain.

I dunno about you all, but I get raises based on merit and COL, not arbitrarily every few months 'just because'.

[dj heavyweight]

you are incorrect about unions being obsolete. unions lobby the federal government for labor laws that actually protect workers. companies lobby the government to strip labor laws from the books and enact legislation such as "right to work" which actually means right to starve and lobby to remove the davis bacon act- which requires contractors on federal work to pay prevailing wage.. companies want the cheapest labor possible, and your a fool if you work in a blue collar trade and actually think that your company will "take care" of you. they wont-the second they dont need you anymore they will shit can you. you can say they will never get rid of you all you want, but time has proven over and over again that when you work non-union most people will not retire. here is a fact form the electrical industry in washington state- no one has ever received one dollar in pension or retirement money from a non-union electrical contractor. why is that? because when your young and full of energy they love you, but when you get older they want nothing to do with you...sounds like a good case for a union to me. only union electricians can actually retire and draw a pension. union electricians and state and federal employees. 401k plans dont even come close to providing enough money for one to retire. guess who lobbied to "do away with" actual pension plans? not unions or employees but the corporatelobbyist.

here is a quote from the financial services industry website


"As companies continue to shift away from traditional pension plans, it is clear that many American workers will face financial insecurity during retirement. The Washington-based Employee Benefit Research Institute reported last month that many Americans will fare worse during retirement because they can no longer count on defined benefit plans and aren't putting away enough in 401(k) plans"

unions only stall production when employers are unreasonable or refuse to negotiate. when a contractor charges 125-150 dollars an hour for you plus material, why should you make less than 25% of that cost? thats you getting taken advantage of and not being paid what your worth. unions make sure you get paid what your worth. (for the most part...not all are good but most trade related ones seem to be)

hardworking union men and women dont get raises "just because" union people get raises through training, credentials, time, and strong negotiation skills.

[B_tech]

Well, I'm against lobbyists, so you haven't sold me. And 401Ks don't have enough to retire? Sure, if you're a moron and don't know anything about investing... or put all your money in Enron like their employees did. I've made quite a bit of money in mine over the past 6 years; compound that with dividends and I'll be just fine.

[Roddimus]

i just heard a statistic stating that the toyota camry outsold ALL of crystler's passenger cars last year.
but yeah, unions were what ruined detroit.
:rolleyes:

[budaho]

Well, I'm against lobbyists, so you haven't sold me. And 401Ks don't have enough to retire? Sure, if you're a moron and don't know anything about investing... or put all your money in Enron like their employees did. I've made quite a bit of money in mine over the past 6 years; compound that with dividends and I'll be just fine.

yes, because people who aren't educated and experienced with the financial services industry are morons and don't deserve to retire comfortably. its good to know that you being just fine makes everything all right though.

its fine and good for you to be against lobbyiests, but they exist, and your oppinion on the matter has no effect on that, so maybe (i still don't agree) in your fantasy world unions are obsolete but here in the real world they serve an important purpose, one that will be even more vital in the forthcomming economic restructuring.

[Roddimus]

The point, Heavyweight, is that unions were created to protect the worker... with all the state and federal laws to protect the worker, they are obsolete today. The only thing they do is drive up production costs, stall production when they demand things from employers and cause disdain.
"driving up production costs" is merely a reaction to inflation, which is caused primarily by the federal reserve.
and it is hardly beyond unions to actually accept wage cuts in the face of declining profits. it has happened many times in the past. but when management is swimming in cash, it's pretty understandable that those whose direct production resulted in the surplus would demand a piece of the prosperity.
personally i think the problems that arise with unions (ie- high level corruption) are the direct result of government involvement in the union/management relationship. if the relationship existed within a truly free market system, you'd most likely see a much more equitable situation for all involved.

[budaho]

personally i think the problems that arise with unions (ie- high level corruption) are the direct result of government involvement in the union/management relationship. if the relationship existed within a truly free market system, you'd most likely see a much more equitable situation for all involved.

that's an interesting point. but how do unions prevent employers from hiring scabs to replace striking workers without government protection.

[Roddimus]

that's an interesting point. but how do unions prevent employers from hiring scabs to replace striking workers without government protection.
does the US have anit-scab laws? i'm aware that some being pushed in canada, but as far as i know companies are allowed to hire scabs when their workers strike. personally i think they should be allowed to do so, but of course they risk massive profit and productivity losses in doing so. isn't the old business rule that if you lose 1 good worker you're actually losing 2 in terms of overall operating costs?

[B_tech]

yes, because people who aren't educated and experienced with the financial services industry are morons and don't deserve to retire comfortably. its good to know that you being just fine makes everything all right though.
I never said that, but to make a generalization like '401ks don't have enough for retirement' is just not true, as many people are able to retire off them. THAT is what I was replying to... the notion that no one can live off a 401k when they retire.


its fine and good for you to be against lobbyiests, but they exist, and your oppinion on the matter has no effect on that, so maybe (i still don't agree) in your fantasy world unions are obsolete but here in the real world they serve an important purpose, one that will be even more vital in the forthcomming economic restructuring.
True, my views have no effect, but if you want to convince me that unions are needed because of the lobbying they do, I'd reply that you haven't done much to show that they're needed. I don't have anyone lobbying for me, nor do any of my co-workers, yet we all seem to get raises and have great benefits. Shit, I have a pension and I KNOW mine isn't in trouble... the UAW workers can't say that much. In fact, it's the requirements and demands OF the unions that have led the the issues the 'big 3' face today; the behemoth healthcare costs, the pensions and other 'fat' that could be trimmed.

So aside from lobbying and putting the future health and financial welfare of their members in jeopardy, please, enlighten me as to how those union workers are better off than us non-unionzed workers are today?

[budaho]

does the US have anit-scab laws? i'm aware that some being pushed in canada, but as far as i know companies are allowed to hire scabs when their workers strike. personally i think they should be allowed to do so, but of course they risk massive profit and productivity losses in doing so. isn't the old business rule that if you lose 1 good worker you're actually losing 2 in terms of overall operating costs?

hmm, maybe not. i thought there were, but maybe its only in certain states.

[burnt]

auto companies to ask for another bailout

http://www.mlive.com/businessreview/oakland/index.ssf/2009/02/auto_analysts_predict_painful.html

GM wants $16.6 billion.
they already got $13.4 billion.
this totals $30 billion.
they originally said they'd "only" need $18.4 billion.

Chrysler wants $5 billion.
they already got $4 billion.
this totals $9 billion.
they originally said they'd "only" need $3 billion.

Chrysler needs an "emergency" $2 billion right now.
like, right fucking now, or they say they'll fail.
awesome statement to make... thats sure to improve sales of company stocks/shares.
I'm sure the current shareholders appreciate this.

Ford hasn't said they need anything.

[Boyd Main]

they big three have essentially been running a scam not too unlike that of madoff. they basically been using current employees labor to pay retired employees pensions so that they can use the money that should be going to their current employees pension funds to pay dividends to stock holders.

Substitute "defense budget" for "dividends to stock holders" and you've just described Social Security!

[burnt]

little bitch on FOX news gets bitchslapped:

http://www.youtube.com/watch?v=a-nLS6FJtSM

I fucking love it

"If you think that I should somehow feel guilty or penalized, because I had straight teeth when I was a kid... if you think that my 84 year old father should suddenly be penalized because of the hard work he did when I was a kid, BUILDING UP the middle class in this nation... "

love it.

[B_tech]

GM and Chrysler are Tandy computers in a laptop age. They're HEMMORAGING debt and owes the unions $48Bil. At what point do we say 'enough' and let them fail?

The argument about 'too big to fail' like Bear Sterns is bollocks too. The parts manufacturers affected would start making parts for OTHER companies and all the dealers (which they even admit there are too many of) would start selling OTHER cars.

If I saw one solid story about how these two companies failing would be that catastrophic and it was based on facts and figures, I might buy it... but it's all conjecture and the unions are lobbying congress because GM owes them so much damn money. The last thing the unions want is to have GM default on all that owed money.

BOLLOCKS.