Workers may get violent if their wages are cut. The United Auto Workers union (UAW) has a monopoly and was an anchor on the Big Three U.S. automakers. These two ideas were professed by two labor leaders at the recent Federalist Society Convention in Washington, D.C.
There may be violence, says Damon A. Silvers, Associate General Counsel for the AFL-CIO and Deputy Chair of the Congressional Oversight Panel for TARP. Silvers spoke on last Friday’s panel “Labor: Wall Street, Labor Unions,…
Considering the enormous amounts of cash that the federal government has hurled at the auto industry since the start of the financial crisis, recipients of government largess in Detroit should at least have the common courtesy of telling taxpayers what they’re doing with their money. Unfortunately, United Auto Workers boss Ron Gettelfinger doesn’t seem to think that applies to him or his union. So kudos are in order to Rep. Jeb Hensarling for calling out Gettelfinger and the UAW on this:
The…
The federal government is spending more than $50 billion to bail out General Motors, with no end in sight. But the UAW union refused to sacrifice its privileged position to save the company, demanding excessive wages and benefits that are much higher than most Americans get. The Obama Administration caved in to its demands, saddling GM with high labor costs that may doom the company in the long run.
As the Washington Post notes today, the “concessions” that Obama obtained from the UAW were…
Even the liberal Washington Post, which endorsed Obama and has not backed a Republican for president since 1952, is getting fed up with the Obama Administration’s wasteful and politicized bailouts of General Motors and Chrysler. Today, it laments the
“imminent transformation of General Motors into a government-owned company, infused with upward of $50 billion in federal money.” “It doesn’t take much imagination to forecast the political pressures that will buffet the government-as-auto-executive. We’ve seen one effect already in the preferential treatment of the autoworkers’…
The federal government poured billions of dollars into Chrysler, which then went bankrupt and merged with Fiat. But Chrysler may never revive, thanks to absurdly generous compensation for the company’s union employees. The Obama Administration has refused to cut union wages substantially, though it had no compunction about ripping off the pension funds and other lenders who loaned money to Chrysler to try to keep it afloat. Even union members seem surprised by how little they were asked to sacrifice.
Moderate Democrat Mickey Kaus, who reluctantly…
Obama accused critics of his decision to give control of Chrysler to the United Auto Workers Union of being “speculators.” But it turns out that many of them are pension funds representing the interests of retirees, who are being fleeced to enrich the politically better-connected UAW.
“Indiana Treasurer Richard Mourdock revealed this week that his state’s police and teacher pension funds have lost millions of dollars in the Chrysler ‘restructuring.’ Indiana’s State Police Fund and Major Moves Construction Fund, which finances roads…
So reads the Washington Examiner’s editorial today about how Obama effectively gave ownership of Chrysler to the United Auto Workers Union (which spent millions electing Obama), rather than taxpayers (who have spent billions to bail out Chrysler) or the institutions that lent money to Chrysler based on the legal right and expectation that they would receive its assets before the UAW union would. Veteran political commentator Michael Barone also calls it “gangster government.” The UAW will also retain “lucrative” pension and health benefits,…
Today’s Wall Street Journal further drives home the difficult position in which the United Auto Workers, Chrysler, and General Motors are likely to find themselves as a result of the UAW becoming part owner of GM and majority shareholder of Chrysler. First, the lead editorial notes the political risks inherent in the arrangement:
Some Treasury officials have told the media that 50% government ownership is important to ensure that taxpayers get repaid for the $16.2 billion in Treasury loans. But this…
The United Auto Workers’ (UAW) loud complaining that they’re being asked to bear a disproportionate share of the costs of restructuring the Big Three begs the question: How much is their fair share to bear? As Holman Jenkins notes, in his Wall Street Journal column, the UAW may not like the answer.
The two parties that turned the Big Three into a perennially limping freak of unwritten industrial policy now will take formal ownership of their handiwork. The United Auto Workers…
Throughout the Detroit automakers’ bailout saga, the United Auto Workers’ leadership has claimed that the union has made enough major concessions to date, and that demands for it to make more, from company and government officials, are attempts “to make workers shoulder the lion’s share of the costs of any restructuring plan.”
If the UAW leadership is so concerned about the union’s rank-and-file bearing the costs of the Detroit automakers’ restructuring, there’s one item on which it could easily save millions for…
The Bush administration’s outline of its automaker bailout package lists some seemingly sensible changes in labor practices that GM and Chrysler need to make. (Ford, to its credit, is seeking private financing instead.)
Targets: The terms and conditions established by Treasury will include additional targets that were the subject of Congressional negotiations but did not come to a vote, including:
Reduce debts by 2/3 via a debt for equity exchange.
Make one-half of VEBA payments in the form of stock.
Eliminate the jobs…
Last night, the Detroit Big Three bailout package crashed and burned for the best of reasons. To their credit, Senate Republicans refused to abide the United Auto Workers’ cavalier attitude toward further, drastic concessions. Reports The New York Times:
Late Thursday, the Senate did not take up an assistance measure passed by the House, after hours of negotiations between Senate Republicans with the auto companies and the U.A.W. The sticking point apparently was the union’s refusal to agree to lower wage and…
Mickey Kaus, a moderate Democrat, explains how the proposed auto bailout contains little leverage for the proposed “auto czar” to really cut the excessive labor costs that threaten the automakers’ survival, and how it is unlikely that the government will “get its money back,” contrary to what the bailout’s (mostly Democratic) supporters claim.
We earlier noted that auto workers at American-owned plants are paid $70 an hour in compensation, while workers at the U.S. factories owned by foreign car markers get…
The auto bailout being fashioned by liberal lawmakers with Bush’s apparent acquiescence contains no meaningful limits on the bloated union contracts that have helped make American automakers uncompetitive by giving autoworkers compensation that exceeds $70 per hour, meaning that the billions of dollars spent on the bailout will simply be wasted.
The bailout is similar to the failed British auto bailout of the 1970s, which destroyed whatever chance the British auto industry had left to survive by diverting its focus from producing good cars at low…
In his CBSNews.com column today, CNet’s Declan McCullagh makes a good case against bailing out the Detroit Big Three. As he rightly points out, decades of extremely generous union contracts have yielded huge liabilities in what have become known as “legacy costs,” which include such things as pensions and retiree health insurance.
In recent years, these legacy costs have become an enormous burden on GM, Ford and Chrysler, who face increased competition from foreign automakers, most of whom have lower labor…
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