The Fall of the House of UAW

You've probably heard by now that General Motors' (NYSE: GM  ) fourth-quarter cash burn was astonishing. The automaker needs more help or it will be busted by March. One element that certainly hasn't helped General Motors become a more efficient company is its dealings with the United Autoworkers of America, or UAW.

Here's an interesting thought experiment: What if the UAW ran your household finances? When it comes to government aid and intervention into companies, this question of efficiency and profitability might be a good thought experiment for the Obama administration to ponder, too.

If the UAW ran your household finances …
… things might look a great deal different, not to mention inefficient. Your kids would probably make a guaranteed $20 per day in allowance. (Hey, your kids already have "nap rooms." Perfect!) Basically, they're going to get their allowance, regardless of whether they do their chores like perfect angels, practice finger-painting skills on their bedroom walls, set the sofa on fire, or do absolutely nothing. Who needs incentives? It would just be mean not to give them $20 a day. They're entitled to it! If you want something done, you're just going to have to talk to the lawyers.

Every member of your household has to drive an American-branded car -- end of story. (You'd disown your kids if they ever considered a Toyota (NYSE: TM  ) or a Honda (NYSE: HMC  ) .) And hey, if it's bigger, the better, so be it -- that has often been the case with many American car models. Squandering energy and oil always worked in the past, even if you heard over and over again that energy prices were going up. Who cares! (Might as well put all the lights on in the house, play the stereo and TV, and vacuum all at the same time; heck, turn on every appliance.) Just keep telling yourself and everybody else that it's just The American Way.

When you tell your kids that the household budget doesn't allow for an Apple (Nasdaq: AAPL  ) iPhone or a Microsoft (Nasdaq: MSFT  ) Xbox because of all these other aforementioned money drains, the kids might go on strike, picketing in the front yard, and then your neighbors are going to think you're really terrible. After all, hot, high-priced gadgets are part of the perks they're entitled to, even if your household balance sheet's a mess. And at some point, somebody's going to blame you at least in part for making Sirius XM (Nasdaq: SIRI  ) a far less viable company as your household is in shambles, and your company isn't in much demand. Drat. Now Howard Stern's picketing in your front yard, too.

Your household's a lumbering, bureaucratic organization, you're always arguing about concessions, the chores aren't getting done, the sofa's still kind of smoldering, people are yelling slogans outside (oh no, Howard brought strippers, too!), and although the UAW set up your finances, you're this close to bankruptcy or destruction if nobody helps you out. Now that's some home sweet home, right?

Good intentions, bad results
Unions have always struck me as good intentions run amok. While I truly believe that companies should treat their workers well, it can't come at the price of running a truly efficient organization; an inefficient money drain simply isn't sustainable, and then what happens to the jobs? Government and unions often don't address or acknowledge economic realities in how to run truly competitive businesses, so the good intentions can have terrible results.

Don't get me wrong, the automakers' managements can't be let off the hook, either. As much as union demands have helped undermine the businesses, the automakers' top managements have been making handsome salaries completely disconnected from the companies' woes. According to the Wall Street Journal, GM's Rick Wagoner got a salary boost last year even though the company has been losing money since 2005. (He made $1.6 million in base salary during fiscal 2007.) Ford's Alan Mulally made $2 million in base salary for fiscal 2007 and a whopping $4 million bonus. Mulally has said that top executives will take pay cuts given the current environment, but it kind of seems like too little, too late, doesn't it?

Still, the industry's problems are myriad, and powerful unions like the UAW have been seen by many as a huge political influence on Democrats and the Obama administration. There was plenty of controversy surrounding the bailout of the banks, but for many, the bailout of the auto industry (with the exception of Ford (NYSE: F  ) , which refused government help) was even more controversial because it was leading to the increasingly slippery slope where almost any company or industry could be viewed as "too big to fail."

Meanwhile, now that GM is hanging on the precipice again, we might want to be concerned about how beholden President Barack Obama may feel toward the unions that arguably helped get him elected. Massive government intervention into the marketplace is already taking place, and there's good reason to worry about the tendency of such policies to ignore economic realities and incentives for innovation, competitiveness, and profitability. GM's abysmal condition -- even after recent government financial support -- should be a clear warning to us about the dangers ahead.

Racing to the bottom?
Personally, I'm never much of a fan of government intervention into our economy. However, many smart people argue that it's not always a disaster; Motley Fool co-founder Tom Gardner points out that the Internet itself didn't actually emerge from the free market. And it's hard to hate the idea of funding for alternative energy, even if some would rather see it come from private sources interested in capitalizing off of innovation and more efficient ways of doing things.

Still, these are precarious times, and care is in order; let's hope the Obama administration thinks long and hard about the steps it takes. The automakers' unhealthy relationship with the UAW should remind us that sometimes good intentions result in a race to the bottom. And a glance at the stock charts of General Motors and Ford -- not to mention the possible continued price tag to taxpayers given the political pressures at hand -- illustrates a race to the bottom, indeed. I wouldn't want the UAW running my household finances -- now the question is, would you?

Chime in with your thoughts in the comments box below.

Apple is a Motley Fool Stock Advisor selection. Microsoft is a Motley Fool Inside Value recommendation. Try any of our Foolish newsletters today, free for 30 days.

Alyce Lomax does not own shares of any of the companies mentioned. The Fool has a disclosure policy.


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  • Report this Comment On March 02, 2009, at 4:39 PM, Flitt12 wrote:

    Great article, best most honest, look at it that I've read.

    While the union is just as guilty of "Too Little Too Late" as the execs, how can you blame them for getting their slice of the Pie? Everyone wants and expects employees in this country to let executives run all over them. If the executives are getting bloated salaries so should the employees. Executives get golden parachutes, so should the employees.

    Or to follow the example of the article, if Dad's sitting in his LaZBoy drinking a beer while the lawn needs mowed, why would the kids clean their rooms?

  • Report this Comment On March 02, 2009, at 5:18 PM, eddie2042 wrote:

    If a union ran my household-my kids would have a fair wage-They would be able to see a doctor when sick, and go to college if they please with what they earned. Their work would be hard but fair, and the house inside would be a safe enviroment.Once they left the household they would succede and survive. But most important our neighbors would be extremly JEALOUS.

  • Report this Comment On March 02, 2009, at 5:31 PM, ToledoBob wrote:

    All parties have had a role in where the auto industry is today. Let's not lose sight of the fact that it takes two to tango and both parties agreed.

    Though I find it curious that while the media and Congress tears auto limb from limb, AIG can seemingly lose all the money it wants, get a blank check each time, fill in the amount, and never set foot in DC. How much did they contribute to Ms. Pelosi, the members of the Banking Committee, and Mr. Obama?? a sum worthy of a bailout or two, apparently.

  • Report this Comment On March 02, 2009, at 5:47 PM, mmccarvi wrote:

    Your comment about large vehicles a was cheap shot and shows poor research. Those Land Cruisers, Tundras, Armadas, FJ's, 470's, Titans,QX56's etc are not exactly fuel sippers and the foreign makers were fighting like crazy to get every large vehicle they could build into our markets. Why you ask, because that is what people wanted to buy and the profits were large ! Foreign makers had no choice but to make small cars for their own markets because gas has been the equivalent of $5 a gallon or more there for many years, and the result is that they became very good at it ! They wanted a piece of the big vehicle market very badly, and have never had much luck getting there until just before everything hit the fan with $4 gas prices. They showed no more foresight in their marketing plans than the domestics. Now Toyota is sitting with a Tundra plant in Texas that is idle more than it is in operation, and has stopped work on their Mississippi Prius plant because they lose money on every Prius sold and can't afford to build more and lose more money ! The industry is in trouble, but the foreigns have shown that they are just as bad at forecasting the market as the domestics are.

  • Report this Comment On March 02, 2009, at 5:47 PM, 508250 wrote:

    There is plenty of blame to go around, and, as usual, all parties are pointing at someone else's blame. But one must wonder why the UAW or any other large union is given the power to destroy a company or an entire industry. It comes from having the government-given power to require all companies to agree to essentially the identical contract in an industry, despite different economic conditions at different entities. So there can be no competition between unions at GM, Ford, Chrysler, Studebaker, American Motors, etc. So the UAW chooses the strongest company, most recently Ford a few days ago, and agrees to its best deal, and then crams that contract down the throats of GM, Chrysler, Studebaker, American Motors, etc., whether they can financially survive or not. Thus, some union members are given better wages and benefits, and others are left out of a job without any way to do anything about it. And, big company executives can give away anything to the UAW in negotiations, because nothing will happen to them, unless they are at Studebaker or American Motors, and even then they can probably shop their skills. So now GM is trying to get the UAW to agree to take much of its remaining value in exchange for GM's promise to fund a health care trust for retirees. What's left for shareholders? Basically, the union, management and government have removed all value from GM and given it to the union and management. Now of course, we hear from the union that the bad old days of union goons and inefficiencies are in the past, and I suspect that much of that is true. But, is anything being done to recompense for those bad old days? Like people who did little or no work but arbitrators would keep on the job? Of course not. The unions are scared stiff, so they have recently made some significant changes. But, if they retain their fundamental power, why would anyone expect any different result if the opportunity arises again? That is just as true of bankers, management, Nazis, Communists, and Republicans. What is needed, I think, is a completely redesigned system that will allow for strong unions but limit them to representing individual economic units, like single companies or producers. Thus, the union and its employees would have a common interest in the success or failure of the economic unit. And one union could not get a contract so generous that it could cram down another company's throat and effectively destroy it. Where is Studebaker? American Motors? It is true that a union/company partnership could reduce costs and undercut another company/union, but what is wrong with that? Presumably the union members are not going to let the management take all of the benefits. There must, of course, be protections against management or company domination or control of a union, but presumably that can be accomplished. Probably something as simple as allowing lawsuits with lawyers getting contingent fees if they prove that there is illegal control. Or some kind of government regulation. As for management, pay them on the basis of value added, in the form of a calculation entailing increasing shareholder dividends and increasing the payroll of the company. If they can do those things, then it means they are serving their customers and increasing value for all stakeholders. And, finally, speaking of stakeholders, when did stakeholders get a share in the value of a company? When governments gave it to them. Why in the world should anyone own common shares at a time like this, apart from a small family-owned enterprise? Unions and management and governments strip all the value they can, leaving shareholders with essentially nothing. Major changes are coming and things will very likely not be pretty. There are businesses and individuals making useful things that are in demand, i.e., they are making profits. But many are trying to take it from them, not to mention competitors. I suspect there will be a long and painful drying out period when some of our basic institutions and practices are rethought. Even newspapers and media companies look like they are not long for this world. There is a new world coming.

  • Report this Comment On March 02, 2009, at 5:48 PM, gearhead66 wrote:

    Alyce, There is almost nothing in your post that is supported by facts. You did not do your homework.

    You apparently missed that UAW members build some Toyotas here in the US, to name one foreign nameplate. There are others.

    You seem unaware that the top ten assembly plants in North America are all union represented. ALL of them. Inefficient?

    You also seem unaware that the UAW gave concessions to the auto firms valued at tens of billions of dollars over the past four years.

    Finally, you should wish that the UAW was running your finances - the union is very conservative with its money and has a net worth over $1 billion. You can look that up too.

  • Report this Comment On March 02, 2009, at 6:07 PM, insidertruth wrote:

    Oh so many Monday morning Quarterbacks! Having worked in and out of the Auto industry for the past 25+ years, I find it very interesting that so many know how everything works in a auto factory...without ever been in one!!! We have so called auto analysts, that are maybe in their early 30's that are just freakin genius's... so they want everyone to believe. Problem is they were crappin' in diapers and I was already a journeymen. so yes, I question their real knowledge of the industry in general. We make in the trades, the same amount as the Breweries, motorcycle manufacturers, heavy equipment, agricultural implement, power companies and so forth. Union or non union. I could go on and on... all are within a few percent of my wages. I find it interesting that a few stupid management decisions can topple companies that have been in business for decades...sometime centuries. If you want to blame someone. look in the mirror, all of us. We let this corporate greed and wall street bull*#@$ get out of control. we let the banking industry go un-checked after deregulating them. We let our politicians implement NAFTA after they received millions of dollars from the big lobbyists groups. We the people need to take the responsibility. We should demand the lobbyist be thrown out of Washington. All I can tell you is I go to work the same as I always have. I do my job as best as I can with the tools and equipment that my company provides to complete my job. My wages are competetive with other industries. These figures that are reported in the media are nothing more then accounting tactics to gain public support. the blaming of the working man for all the ills in the industry at the moment are outrageous. Know the facts, get a job in the industry, work for a while...I isn't all you may think.

  • Report this Comment On March 02, 2009, at 6:07 PM, jraffy wrote:

    Alyce Lomax,

    I agree with gearhead66. I worked for GM for over 30 years with a promise of Health Care and Pension and I am worried that I might loose it all and I really don't need someone as stupid as you writing about something you know nothing about.The most I ever made was $82,000 in one year and I worked plenty of overtime to make that. I retired in 2002 and I am sad to see all of the people that are cutting up the UAW members after we have given back so much.If we made millions like the big wheels we wouldn't need a pension.God bless the UAW membership.

    H.J. Raffensberger

    Retiree of Local 1590

    Martinsburg, W,VA

  • Report this Comment On March 02, 2009, at 6:28 PM, chopchop0 wrote:

    gearhead66,

    Except for the plant in NUMMI plant in CA, Toyota uses all non-union labor, along with all of the other foreign companies (Honda, BMW, Hyundai etc.). They also locate in predominantly southern, right-to-work states, and rightfully so.

    The NUMMI plant in CA is definitely hurting Toyota because of it's UAW affilation.

    http://www.thetruthaboutcars.com/nummi-rip-toyota-considers-...

    Unions are obsolete in the modern economy.

  • Report this Comment On March 02, 2009, at 6:39 PM, babyraymond wrote:

    Its not the UAW hurting GM. Labor is only 10% the cost of a vehicle! UAW members do not make 70 dollars an hour as Fox News(The GOP Channel) will tell you. We are talking about a company that has been employing americans for 100 years! What is hurting GM is unfair trade agreements! Government imposed EPA and Cafe standards and competition that has a majority of its operations in countries that have Nationalized Health care. Its time to start manufacturing things in this country again. I am sick of buying American flags from Wal-Mart that are made in China! Be American!! Buy American!! Drive American!! I wonder if Toyota would transform one of their plants for our countries defensive purposes in wartime.I think not!!

  • Report this Comment On March 02, 2009, at 6:55 PM, PublicD wrote:

    Democratic unionism is the only real check & balance to ensure there's a fair day's pay for a fair day's work. Yes, equitable distribution of the wealth we all help create. Not just the top 2%.

    The new Center for American Progress Action Fund reported this week:

    "Prior to the 1980s, productivity gains and workers’ wages moved in tandem: as workers produced more per hour, they saw a commensurate increase in their earnings. Yet wages and productivity growth have decoupled since the late 1970s. Looking from 1980 to 2008, nationwide worker productivity grew by 75.0 percent, while workers’ inflation-adjusted average wages increased by only 22.6 percent, which means that workers were compensated for only 30.2 percent of their productivity gains."

    It also noted:

    "One of the primarily reasons why our current recession endures is that workers do not have the purchasing power they need to drive our economy."

    Which reminds me of Adam Smith's assertion:

    ""It is but equity, besides, that they who feed cloath, and lodge the whole body of the people, should have such a share of the produce of their own labour as to be themselves tolerably well fed, cloathed, and lodged."

    Does anyone here actually think Food, Clothing & Shelter are anywhere near Alyce Lomax's version of 'economic realities' when she writes things like:

    ". . . unions often don't address or acknowledge economic realities in how to run truly competitive businesses . . ."

    ??

    Or does she mean that workers must buck up and discount the value of their work – and pay no mind the Ladders.com and the inflated entitlement it represents for the desk-dwelling, um, what's the word, labor force? Masters of Household Finances?

  • Report this Comment On March 02, 2009, at 7:07 PM, poohhbearr wrote:

    I don't know much about the Union. I do know that I don't have anybody fighting for my wages. My job is not in jeopardy, and our company is doing well. Oh how I would love to have everything paid for me when I retire but thats my job. That's why I save and have a 401k and do more than my part to always try to do better than the person next to me at work.

    One thing I do know is, the government and the public are asking that the UAW renegotiate it's terms. Which shows me one thing, it's bringing the company down, among other things. 10% of a billion is 10million. That's a lot of money. And you don't base your % on the car but on sales. Have you checked to see what your UNION leaders are making. You might want to question them. They are costing you your jobs possibly. Like I said I don't claim to know, but If my job was in jeopordy I would want to be able to fight for it. I think of unions as a group, so when one is hurt so are all the other. That is the downfall.

    My family grew up with unions and have always stated that they are taking advantage of the company. So say what you want, the UAW seems to be part of the problem. Not solely, but a part. I'm sorry some might loose their insurance, but nobody is paying mine!!!!!

  • Report this Comment On March 02, 2009, at 8:07 PM, Modiolus wrote:

    The automakers' unhealthy relationship with the UAW should remind us that sometimes good intentions result in a race to the bottom

    Is there an unhealthy relationship between Washington and the UAW?

  • Report this Comment On March 02, 2009, at 9:26 PM, hoho1968 wrote:

    HEY FOOL: LETS PICK ON AIG OR GOLDMAN SACHS, OR HANK PAWLSON! SOMEONE THAT REALLY DESERVES IT!! THE UAW AUTO WORKERS DESERVE EVERY PENNY THEY EARN. DESPITE WHAT YOU MAY THINK; THEY ARE DEDICATED EMPLOYEES THAT WORK DEDICATED TO BUILDING A GOOD PRODUCT EVERY DAY; NOT LIKE THE MONEY SHUFFLERS WHO HAVE CAUSED THE MESS WE ARE IN! SINCERELY HOHO1968

  • Report this Comment On March 02, 2009, at 9:40 PM, COOLJAKEMO wrote:

    SO MANY WANT TO BLAME THE UNIONS SUCH AS THE UAW......I HAVE ALWAYS SAID BEING IN A UNION AND BEING A UNION WORKER IS MUCH LIKE LIVING IN THE UNITED STATES VS OTHER COUNTRIES.....DO WE HAVE PROBLEMS YES.....BUT I WOULD RATHER LIVE HERE THAN ANY WHERE ELSE....SAME WITH THE UNIONS.....DO THEY HAVE SOME PROBLEMS ...YES...BUT I RATHER WORK IN A UNION SHOP THAN A NON UNION ONE.....REMEMBER FOLKS, IT WAS THE UNIONS SUCH AS THE UAW THAT MADE THE MIDDLE CLASS THAT WE ONCE HAD AND ENJOYED.....ALSO REMEMBER WHEN CARS AND TRUCKS WERE SELLING THE BIG 3 WAS MAKING MONEY....IT IS THE FACT THAT NO ONE MUCH IS BUYING NOW AND NOT THE UNION WAGES AND BENEFITS THAT IS THE CULPRIT,,,,,EVEN THE NON UNION PLANTS ARE CUTTING BACK AND LAYING OFF......ALSO REMEMBER THE BIG 3 HAS HEALTH CARE TO PAY AND PENSIONS TO PAY TO THE WORKER WHO SPENT 30-40 YEARS WORKING IN THE FACTORIES....THE NON AMERICAN BASE COMPANIES IN MANY OF THEIR PLANTS HAVE NO HEALTH COSTS TO PAY AND NO HOURLY WORKER HAS A PENSION...ALOT OF THEM GET FIRED IN NON UNION PLANTS FOR HAVING TO GO ON A SICK LEAVE....ALSO IT IS NOT UNIONS THAT ORGANIZE WORKERS....IT IS EMPLOYERS THAT DO IT BY MISTREATING WORKERS......WE HAVE BEEN MISLEAD ON MANY ISSUES INVOLVING THE UAW AND ITS WORK FORCE...... IN A STUDY TAKEN IN 2006 BY KANSAS U. WHICH SHOW THE UNION SHOPS PRODUCE MORE PRODUCTIVE LABOR HOURS PER CAR THEN YOUR NON-UNION PLANTS. ACTUALLY WE SHOULD SUPPORT OUR UNIONS AND THEIR WORKERS AS THEY ARE AS AMERICAN AS WHAT WAS OUR MIDDLE CLASS.....AND IN THEIR FIGHT TO KEEP THIS COUNTRY FROM THIRD WORLD WAGES AND STANDARD OF LIVING THAT WE ONCE HAD HERE IN THE USA.

  • Report this Comment On March 02, 2009, at 11:07 PM, redclaymud wrote:

    So we all agree to disagree. If I understand this, neither GM, it's management or the UAW or it's leaders are at fault. So who's left to blame? "Outside Influences"? Woooo. Scary stuff!!.

    Outside influences are trying to keep this company from floundering. Their interest and patience will wane as the impossibility of the task becomes apparent. Meanwhile, they continue to pour good money into a bottomless pit.

    Does GM need a motivator? Yes. Does the UAW need a motivator? Yes. It's time to pull life support from the patient and see if it can breath on its own. If that doesn't motivate them to fix their own mess then good riddance to a bad investment.

    ----------

    redclaymud formerly owned shares of General Motors (NYSE: GM). redclaymud has been driving a 1988 Toyota 4Runner (NYSE: TM) for the last 375,000 miles.

  • Report this Comment On March 03, 2009, at 12:06 AM, ibankingcrooks wrote:

    And also, to insidertruth and the other fools on here who want to talk big about "buying American" and how the trade agreements are what "really" is the problem.

    ---

    Every economy, just like every company, and every individual has to do what they do best in order to be the best. i.e. Fat kids become linebackers not wide receivers.

    The US long ago became a different economy than Asia. We are an economy of information & high-end goods. Most importantly we run the world's largest global 500s, and we are the source of the most innovative new products. (and I pray we can continue to be)

    In order to be those things, we MUST have global trade, and trade which is un-incumbered.

    Now, trade is a two-way street folks. You don't get to make cars your way (expensive way) and the implement policy which forces people to buy, and then EXPECT the other country to let us sell our microchips cheap to them. It just doesnt work like that.

    For those of you "buy American" fans - keep in mind, that all those inefficient, unreliable American cars get over 50% of their oil from Alberta, just north of where they are made. And that relationship is highly dependent on NAFTA. If your go researching, a lot is. In fact, the bail out we are handing your pitiful industry, is dependent on a taxes, much of which were financed over the last decade on the huge amount of innovation in IT-related industy.... Most of which is export, and depends on our WTO agreement and such.

    The "buy American" just shows your same pitiful understanding of the world economy & the US role in it.

    Your right, i dont know anything about working in a car factory. And guess what, I don't need to. B/c I know how much your car costs. Get it??

  • Report this Comment On March 03, 2009, at 1:58 AM, luckyIguess wrote:

    I grew up in Michigan and saw the UAW abuses first hand. Almost without exception, UAW workers receive higher pay and superior benefits to comparable workers in every other industry. They work fewer hours, they have more vacation days, they can commit almost any infraction they like and they consistantly ask for more. Enough is enough! It's taken forty-five years, but we've finally reached the breaking point. The UAW has repeatedly bitten the hand that has fed (and over-fed) them, but despite the Big Three's willingness to continue their capitulation, there's just no money left. The bank has been broken. But not to worry UAW, the Democrats are in office. I'm sure that soon the Americans that have already stopped buying your over-priced, sub-standard vehicles will be forced to support you via taxes.

    If their were still justice, the Big Three (maybe not Ford) would be forced into Chapter 11 so that they could re-organize, break the UAW and transform into competative companies again. Let's hope.

  • Report this Comment On March 03, 2009, at 10:47 AM, BKlounge22 wrote:

    Seems like we can kill two birds with one stone. The Feds are determined to shoot billions to the auto companies, and still the auto companies can't sell their cars. Let's make a trade -- much like the stake the Feds took in Citi, let the auto companies pay back the federal government in trade.

    If they don't have the cash but do have a lot of overpriced inventory, seems like they should repay the government with these same unsellable cars. Let GM vehicles be the government fleet vehicles. The Feds can collect all these cars that won't sell and either use them or distribute them to state governments that need them.

    Now the glut of unsellable inventory has been reduced, and the government has something tangible in return for the ill-advised bailout money they spent on the auto companies (which is prob more than they'll get from the bailed out banks).

    GM could then begin shifting towards actually making cars that people want, knowing that in the meantime they could sell their crap vehicles to the Feds for continued life support until they design something that consumers will pay for.

  • Report this Comment On March 03, 2009, at 11:04 AM, justanamerican wrote:

    My husband works for a non union foreign automaker and hopes to keep it that way! He comes from a very strong union background (father and ALL of his uncles) and has seen the ups and downs of being in a union. While appreciating what the unions have done in the past, he and most of his coworkers just do not see that they need the UAW in their plant. The company does pretty good by them, not saying that there are not problems but no place of business is perfect! As for the future, not even a UAW plant can guarantee your retirement! Also, I have noted that all the UAW supporters (as usual) talk badly about foreign automakers in this country but nothing negative about the Big Three building plants in other countries--where THEY are the foreign automaker!

  • Report this Comment On March 03, 2009, at 11:29 AM, Knifecatcher1 wrote:

    I'm shocked -- and pleasantly surprised! -- that so many in Fooldom understand that organized workers are not the blame for all, or even most ills in the auto industry.

    I especially appreciate the comments from "eddie2042". There's something very special about being able to take your kids to the doc and get teeth fixed and go on vacations, just like the executives do. Well, not 'just' like, but you know what I mean. Paying a good wage and benefits is not the downfall of companies. Success of a business does not have to always come on the backs of working people ... although that's the easy answer that comes to mind first for people who've never done really hard work to make a living. The folks in top and middle management had more than a couple of paws in the decline of the auto industry ... exceptionally poor decisions on design, consumer research, engineering, marketing, ... the list is very long. As others have said, there's plenty of blame for all to be 'entitled' to.

    Hopefully management and labor will find common ground to rebuild the industry.

    Failure of the industry is no longer a quality issue. Just a side note about my vehicle experience: Of the last few cars I've owned, Mazda/Ford, Chevrolet Impala, Toyota, and Volkswagon. The Impala, now with 120k mi, has been fuel efficient, powerful, safe, comfortable, and the most trouble-free since new; the Toy next, with both the Mazda and the VW Passat absolutely dismal. I'd take a sledge hammer to the VW ... if I could still afford one.

  • Report this Comment On March 03, 2009, at 12:59 PM, Drspartan wrote:

    This is unsupported drivel. Worse than that, it is inflammatory rhetoric.

    The American Auto Industry is putting out the best vehicles in terms of safety and quality in the respective classes and that has been indepently verified time and again.

    The Unions need to be praised for their willingness to make sacrifices to help the company.

    Even Toyota is asking for government loans. I hardly think Japan will let that company go under.

    Because of the unions there is a middle class in this country. Most people, whether they have a union job or not, have benefitted from Union stands.

    Slippery slope? Youre talking about the loss of millions of jobs.

  • Report this Comment On March 03, 2009, at 1:35 PM, slakk wrote:

    Alyce,

    You have major misconceptions of the UAW.

    The UAW does not choose the business or product strategy. The UAW bargains for a fair day's pay for a fair day's work. They have no say so on what sort of product or marketing scheme the company comes up with. They go to work, and do what they are told. You seem to think that they get paid for sitting at home. that is simply not true. Your assumptions illustrate your ingnorance. I DARE you to go work on the line for a week. Right now you won't even have to work the mandatory 14 hour day, 7 days a week, for three weeks straight either. Go try it out, then tell me how much you think the job is worth and rather you think you need someone to represent and protect you and your rights after you are continually threatened, sexually harrassed, acousted, and verbally assaulted for 40 hours. Not to mention the toll it will take on your health and family life. Enjoy, good luck.

    slakk

  • Report this Comment On March 03, 2009, at 2:07 PM, slakk wrote:

    Ooops-- Alyce, I almost forgot....

    You actually got PAID to write that article?

    At least union workers EARN their pay.

    You made something up, published it, and expect people to believe it.

    Thats likes rolling a little red wagon out onto the dealership floor and trying to call it a Mustang and asking 30k for it.

    We are Fools here, with a capital "F". Not fools as you appear to take us for. Do your homework next time. Hey, you can even CONTACT the UAW (or me even) when you write your correction article.

    Tom and Dave,

    Are you sure you want people like this working for you?

    Alyce, once again, if it weren't for unions, there wouldn't be equal pay for women, there would not be maternity leave, or FLMA. There would not be child labor laws, or civil rights, or employer funded health care. There would not be 40 hour work weeks.

    Enjoying your weekend? Thank the UAW. Like that time-and-a-half overtime pay and off-shift-premium compensations? Thank the UAW. How about freedom? Do you like that? Thank the UAW. Winning WWII? Thank the UAW. Volunteers at the VA to help with Vetrans? Thank the UAW. Blankets, clothes and food for the homeless? Thank the UAW.

    The union does not dictate to the auto companies how to run their business. Often times at the bargaining table, management uses the following term: "We have the right to mis-manage."

    I am a union member. I have been trying to get the attention of the leaders of my company for ten years to warn them that we were circling the toilet bowl. They did not listen. I have spoken face to face with CEOs of auto companies and tried to explain to them what was going to come out of building gas guzzlers and how all those risky mortgages for McMansions out there was going to smash our business to smithereens. Management refused to listen. They called me "crazy".

    You think union members get paid too much? You should see what all eight of my bosses make! And a free car and free gas to boot! Plus they aren't humping the line and bouncing tires all day either. You really have no business commenting on the automotive business.

    slakk

  • Report this Comment On March 03, 2009, at 2:25 PM, Wharton93 wrote:

    Unions made sense in the 1920s when labor standards were such that people were losing arms in machinery or 14 year olds were in the coal mines. Times have changed.

    Industries/companies with high union representation have more "problems" then "solutions": auto, airlines, teachers, Postal Service...

  • Report this Comment On March 03, 2009, at 5:45 PM, mrpogo14 wrote:

    Alyce, I guess you've never belonged to a union. Unions are good.

  • Report this Comment On March 03, 2009, at 7:06 PM, gary923 wrote:

    'CNN Headline News did a short news listing regarding Of FORD and GM's contributions to the relief and recovery efforts in New York and Washington.

    The findings are as follows.....

    1. Ford - $10 million to American Red Cross matching employee contributions of the same number plus 10 Excursions to NY Fire Dept. The company also offered ER response team services and office space to displaced government employees.

    2. GM - $10 million to American Red Cross matching employee contributions of the same number and a fleet of vans, suv's, and trucks.

    3. Daimler Chrysler - $10 million to support of the children and victims of the Sept. 11 attack.

    4. Harley Davidson motorcycles - $1 million and 30 new motorcycles to the New York Police Dept.

    5. Volkswagen -Employees and management created a Sept 11 Foundation, funded initial with $2 million, for the assistance of the children and victims of the WTC.

    6. Hyundai - $300,000 to the American Red Cross.

    7. Audi -Nothing.

    8. BMW -Nothing.

    9. Daewoo - Nothing.

    10. Fiat -Nothing.

    11. Honda - Nothing despite boasting of second best sales month ever in August 2001

    12. Isuzu - Nothing.

    13. Mitsubishi -Nothing.

    14. Nissan -Nothing.

    15. Porsche -Nothing. Press release with condolences via the Porsche website.

    16. Subaru - Nothing.

    17. Suzuki - Nothing.

    18. Toyota -Nothing despite claims of high sales in July and August 2001. Condolences posted on the website

    Whenever the time may be for you to purchase or lease a new vehicle, keep this information in mind. You might want to give more consideration to a car manufactured by an American-owned and/or American based company.

    Apart from Hyundai and Volkswagen, the foreign car companies contributed nothing at all to the citizens of the United States ...

    It's OK for these companies to take money out of this country , but it is apparently not acceptable to return some in a time of crisis. I believe we should not forget things like this. Say thank you in a way that gets their attention..

    Just thought y'all should know. Greedy auto workers eh. I dont hink so.

  • Report this Comment On March 03, 2009, at 7:11 PM, wakeupUSA wrote:

    You union people are all the same. The times in my life that I had to work with union workers I found that they were the laziest, most arrogant, uneducated people I ever met. Unions have no place any more in this country. All they do is promote a union mentality of "do the least amount and get paid the most for it" which is why so many companies (like GM) with union labor cannot compete. Unions are a breeding ground of corruption and are most interested in just increasing their membership and making more money for the union. That is not to say that the UAW is the only reason why GM and Chrysler are failing - they're not, but they are a big part. You folks need to wake up and realize what a fair wage is by looking at what non-union people make for skilled and unskilled jobs. My wish would be that every union in the US was dissolved - the job market will decide how much you are worth.

  • Report this Comment On March 03, 2009, at 7:17 PM, Unclelaffey wrote:

    How the "mighty" have fallen

    Reports: Toyota asking for Japan government loan

    Yuri Kageyama / Associated Press

    TOKYO -- Toyota has asked for a 200 billion yen ($2 billion) Japanese government loan, local media reports said Tuesday, as the world's top automaker projects its first yearly net loss in nearly six decades.

    Toyota Motor Corp. did not have an immediate comment but said it was preparing a statement.

  • Report this Comment On March 03, 2009, at 8:31 PM, tramagli wrote:

    Without a doubt the UAW and unions in general are destroyiong the economy. The Fascist union stooges and their Fascist Democrat lackies are sucking the lifeblood out of every profitable enterprise. Don't try to tell me the myth about unions representing the workers and ensuring fair pay, the only pay the head stooges care about is how high can they jack up dues; and the only time you see the stooges is when it is time to collect.

    Oh yeah, I was a union machinist for nine years and shop steward for one and a half of those nine.

  • Report this Comment On March 03, 2009, at 9:15 PM, teejk wrote:

    ok...been reading for about 10 minutes now...can somebody tell me who won?

    thanks

  • Report this Comment On March 03, 2009, at 10:20 PM, geowaldman wrote:

    We don't need unions. We don't need health care, a 40 hour week, job security, the right to protest an unfair firing, unequal pay for women, democracy in the workplace. We don't need a middle class.

    What we really don't need is out of touch commentators who are unconnected to the pain felt now by real people. What I do...I go somewhere else. Goodbye.

  • Report this Comment On March 03, 2009, at 11:49 PM, TDUBFISH313 wrote:

    All you guys bashing unions are clueless. The reason your in a low paying job is probably because you're working with a bunch of illegals.

  • Report this Comment On March 04, 2009, at 12:21 AM, dbman5 wrote:

    It's amazing how many people who essentially know nothing can be so sure of themselves. "I heard it from a friend and *I believe* so it must be true."

    My step brother retired from GM after 30 years. He gets something like $26,000 a year as his retirement. Yeah, now that's living like a king! He sold his small house and bought a smaller house that he thinks he can survive in.

    Somebody asked something like, "If it wasn't management's fault and wasn't the worker's fault, and wasn't the union's fault, whose fault was it?" Well, here's a thought, maybe it's a little of everybody's fault - including the public.

    There has always been a "mystique" to foreign cars. (In many cases there's even a "mystique" to foreigners. I know some Japanese kids who are upset because all the American kids expect them to be so smart - but they aren't any different than the American kids. Some are smart; some aren't.)

    For a long time now I've heard a lot of people say they *will* not and have not visited a GM, Ford, or Chrysler dealer in many years - and in some cases they have never visited one. When pressed, almost every one of them admitted that their friends would make fun of them if they drove an American car. So the current fad is, "If you don't drive a foreign car, you're not cool!" It doesn't matter if you get more for your money, or the car fits your needs better, or if it gets better gas mileage, or the quality ratings are higher. (Yes, many American cars now have higher quality ratings than a lot of the foreign cars - this even from the sometimes biased press.)

    So, how does GM, Ford, or Chrysler fight the fad? If people aren't even willing to look at the cars because "it wouldn't be cool" then there's no way to win the battle. I'd be happy if 1/2 the people I knew would just go to one of those dealers and take a serious look at the cars - then those companies might have a fighting chance.

    SECOND ISSUE: Unions.

    Yes, let's eliminate all unions. I think that's a great idea. That way in a few decades we can have two classes of people - maybe 1/2% that are really, really, super rich and the rest will be peons that have no health care, no retirement, and barely enough to live on. Think I'm exaggerating? Read some history. When all power is taken away from the people, the ones left in power will take everything for themselves. Although there are a lot of very good individuals out there, as a group, humans are basically selfish and mean to "outsiders".

    Look at the changes in just the last 10-15 years. It's a fact that the separation between rich and poor has become much greater. Eliminate all unions and I guarantee you that even the non-union companies will be cutting wages. Right now they still have to have competitive wages but what happens when there is no competition? They'll cut wages faster than you can say, "Kill the unions."

    Have some unions gone too far? Probably. BUT, have some companies gone too far also? Yes.

    The answer is not "no unions" and the answer is not "unions should get whatever they want". People in this country have got to quit with the "all or nothing" attitude. The best answer is usually some combination of both that creates a reasonable balance.

    By the way, I have never been a union member.

  • Report this Comment On March 04, 2009, at 12:33 AM, HotStove3 wrote:

    Alyce

    I am going out on a limb( not like one of the earlier posters) and guess that you wrote this for the entertainment of you and your coworkers. I must admit at being very dissapointed while reading this artical.

    You have succeeded in touching a nerve with a great many people by writing this. Pat yourself on the back and have a good laugh.

    Thousands of Americans will be thrust out of work when one or more of the US car companies go under. Then perhaps Toyota will realize they too can close their plants here in the states and move their operations to Mexico because those folks will work for half the wage. Some will say bankruptsy is not a death sentense for car companies although we all know they will not recover or emerge from it.

    Concerning auto manufacturing It comes down to the price of healthcare in this country. Healthcare inflates the cost of domestic vehicals vs foriegn issues period.

  • Report this Comment On March 04, 2009, at 7:37 AM, cubiefool wrote:

    US auto industry in a tailspin, but not the unions fault, not managements faults, no one's fault! Rather than bash each other (last I looked you all played for the same team), maybe you need to develop a plan on how to get yourselves out of your current situation, because in a couple of months it will be nobody's fault but your own when they padlock the doors and you are all out on your butts looking for work. Stop living in the 1950 and 1960's. Your current business model obviously does not work and will not work IF YOU just keep doing the same old thing. You make a commodity that anyone in the world can make at a lower cost than you. Look at the steel industry as an example, do we still use steel...yes. Is it all made in the US...NO! Will we drive cars...yes, but WE will buy them from the lowest cost producer, with the best quality that we can afford. If its US made that's great, but it will be the best that we can afford! Why do we shop at Walmart...best pricing on best products that we want! Does anyone care where it was made? Obviously not! Do we care if Detroit survives? Not really, but we will still be driving cars with or without Detroit. The train has left the station. Its' 2009 not 1959!

  • Report this Comment On March 04, 2009, at 12:45 PM, mpyer wrote:

    it's everybody's fault. management, the UAW, the american public who bought the SUVs. this crisis is not going to be fixed until the "i wont, no, CANT be happy until im doing better than all of my neighbors" mentality stops being the driving force behind everything that gets done in both business and personal lives.

    the majority of the UAW members are probably all hardworking, honest, good-hearted people. they'd be idiots to turn away all the benefits they got.

    unfortunately being a good person isn't a good qualification for whether you deserve to keep your jobs, or whether companies deserve to stay afloat. ask the millions of people who have been laid off in the last 6 months.

    the fundamental business models of the Big 3 has failed, and failed horribly. the UAW workers took part in that business, and reaped the benefits when times were good, now want to duck their heads and walk away unscathed as the ship sinks.

    life isn't fair. it's time to wipe the American Auto Industry clean and rebuild.

  • Report this Comment On March 04, 2009, at 1:17 PM, Truthisgood wrote:

    Dear Truthisn'tfree,

    I understand your lack of economic knowledge is hindering your argument so let me help. Sweden would be one example of everyone making union wages, 83% of the workforce is unionized, they have one of the highest living standards in the world, and run a trade surplus. We can do the same but not with the same "every man for himself', let me drive my import and act like it doesn't damage the economy mindset you evidently possess. If your argument is all workers shouldn't be unionized, which ones should be subservient so you can buy your stuff cheaper - as if that could actually happen since the corporation takes the difference, see NAFTA.

  • Report this Comment On March 04, 2009, at 3:59 PM, MikeInMich wrote:

    dbman, you hit the mark. Buying US cars is out of fashion. No nation in the world has as much self hate as the US, and this fashion is a visible expression of that self hate. I think it started during the Viet Nam war. There does not seem to be much we can do to overcome this anti American car company bias.

    The UAW is not helping the matter much now that everyone knows how overpaid they are. At least they are making some concessions, but all the people who make a fraction of their pay for equal or harder work feel justified in buying from the low cost foreign companies. I can hardly blame them.

    It would be great if the big 3 could open non-union plants in right-to-work states, but the UAW would use violant means to close the remaining union plants.

    It is a sad situation when it is out of style to support you home based industry. No other country in the world does this.

  • Report this Comment On March 04, 2009, at 9:11 PM, patriotic1 wrote:

    I can't believe the myths perpetuated with the Milton Friedman economics BS spewed in this article! American industry has killed the goose that laid the golden egg when they sought and or seek the cheapest labor (overseas) due to the theory that they would maximize profit, (short term), as they have attacked the well paid union workers (consumers) in America. Since in fact every auto worker employed in America creates 9.25 jobs in the American economy. When a person can be gainfully employed to the extent that they can meet their financial obligations, rent/mortgage, utilities, food, clothing, transportation, pay their credit obligations and save for retirement with something extra left over, (discretionary spending) this is what makes the economy work! The OUTRIGHT LIE perpetuated that UAW workers are paid over $70 an hour is just that, an OUTRIGHT LIE!!!! Not only has the short sighted greed of corporate America killed or is in the process of killing the greatest consumer class in World history, they are killing America's ability to fend for herself as it was the EVIL UAW that was insturmental in meeting our industrial needs during World War II,the late great Walter P. Reuther was behind the 599 planes and 500 tanks a day! Without the enginuity and hard work of the men and women of the UAW the outcome of World War II would have certainly been quite different! Also I might point out that there has been a shift in the mentality of the UAW leadership over the past 2 decades. An atmosphere of working with management to improve productivity, eliminate waste and become more efficient is evident in the productivity gains and quality improvements as well the past collective bargaining agreements! $4 a gallon gas did in the domestic auto industry as it relied greatly on high profit margin trucks and SUVs. Also I would like to dispell the quality myth as Consumer's Report magazine will attest that the quality gap has been closed! So don't be so quick to shoot the UAW in the head and leave it for dead! I find it laughable that the article talks about "the race to the bottom", the fact is "the race to the bottom" is being achieved by poor trade practices that force American workers to compete with slave wages around the world and the resulting lowered standard of living right here in the United States of America!

  • Report this Comment On March 04, 2009, at 9:58 PM, Cheetah54 wrote:

    $35000.00 for a new pickup truck with toys on it you

    do not need. A sensor to monitor air pressure. Are

    you blind? The vehicle talks to you. There are HUMANS to talk to. A radio that picks up signals

    from places you did not know were there! 500 hp, give 200 back to the horses,you can't use all that power

    on city streets. Everything under the hood is com-

    puterized. Thats nice, until it BREAKS! Watch the

    money pour out of your wallet, just after the warranty

    expires. Another funny thing happens. You pay your

    $30000.00 for a new car,plus INTEREST, for 5 or 6

    years,YOUR CAR IS WORTH HALF IT'S VALUE

    SINCE YOU BOUGHT IT!! Thats smart too.

    People may bad wrap the CEO's of a company, blame

    a union that drains companies of their money, give the

    employees whatever they want, unless they want a

    STRIKE on their company,which hurts the company

    further. I am also a union member where I work. I do

    not even know that I have a union half the time because I do my job, do not complain, show up

    everyday. I'm still alive and well, and still WORKING!!

    Automobile prices are HIGH, home prices in areas

    are OUTRAGEOUS, a lot of prices are RIDICULOUS!

    GREED has to end!! If not, nobody buys anything!!

    DO you know who is to blame,CONSUMERS.

    We enable the greed, we should be able to stop it.

  • Report this Comment On March 05, 2009, at 7:18 PM, cann211 wrote:

    I said let them go in November and I say it again. What are they doing now? Making cars that no one is buying. what did they do before (when times were booming)? Making cars that no one bought. It's sad that parts dealers, workers, etc will be out of a job but there's clearly no purchasing going on. And if they were bleeding when times were good - well, that's clearly just poor management. If they lacked the foresight to "invest in the future" by offering options to gas guzzling, crappy tanks, then they made their bed...it's not like hybrid cars sneaked up overnight. It's not the unions. The unions follow the market (if management is paying attention). Besides, whenever the banks get their act together so people can actually BUY a car if there's a void for purchases it'll be filled by the remaining companies - if not, there was no market for these products anyway. It's called survival of the fittest (capitalism) and they're appear to be too fat to compete!

  • Report this Comment On March 05, 2009, at 7:31 PM, cann211 wrote:

    Very good points dbman5 ! It's also instructive for all the union-bashers to recall that the American middle class was built on unions! Not just modern benefits like healthcare, and fair wages, but work safety, age limits, fair work hours, etc etc. If anyone doesn't believe in the greed of unrestricted, non-union (powerless) masses I suggest you read up on the current financial meltdown!

  • Report this Comment On March 06, 2009, at 5:44 AM, Xciteddon wrote:

    I don't think unions are a bad thing, I think they make some good points, butt....Their timing is off! I think CEO salaries should be a percentage of net profit. If a company can afford to pay you well you get paid well. In otherwords if you do your job you get a bonus! I think paying a person running your business huge salaries for lossing money is absurd! But I think if a company is doing well everyone, including the little guys should benefit. It is on the backs of the little guys that a company profits. But I must punish the unions too., They do not realize, nor do most employees realize what it costs a company to employ a person. Do they realize what it cost a company per person for on the job disability or injury insurance? Do they realize that companies pay taxes for each employee that they never see? In health care coverage, do they realize that some companies help pay the costs for them and their families? They get a lot more than just their salaries. It costs companies money to hire you! I don't think Unions or employees think about these things because normal individuals don't realize that it happens! I get upset with Unions because people who are really bad employees can't be fired. I am so glad I live in a right to work state. Maybe there should be more!

    DEE

  • Report this Comment On March 06, 2009, at 10:01 AM, forwardlooking00 wrote:

    Unions......Love 'em or hate 'em it doesn't really matter anymore. I've worked on both sides of the fence as a Teamster and as a manager of Teamster employees. I've read a lot of interesting comments here and believe both sides of the debate have some valid points (for or against unions). I've never worked in the auto industry but do have a solid understanding of unions and how they work. Bottom line.....I'm a proud American and will do everything I can to support American workers and American busineses. This is still the GREATEST country in the world and I have no doubt that we will come out of this crisis stronger and better than before.

  • Report this Comment On March 06, 2009, at 1:06 PM, aneedle1 wrote:

    LIVING IN DETROIT HAS IT'S OWN REWARDS

    UAW is a crime family, just like they say never buy a American car built on Mondays or Fridays because the union members were hung over. Now you are crying because your union leaders spent or gave your Health Care and Pension funds away, and you jobs are gone, well you once had it good you had the world by the balls. Like where else in the world can a high school dropout make close to $80 dollars an hour for installing floor mats, you have milked the cow dry, I hope you have saved some of the big bucks that you made cause you will need it. On your next job do not forget to ask if they want that fries...

    = Crime = Jimmy Hoffa type of folks.

    Autos that are are crap and we all know why..

    Where else can you get paid that much money to install floor mats. Get real. Your penshions and insurance

  • Report this Comment On March 06, 2009, at 1:08 PM, aneedle1 wrote:

    LIVING IN DETROIT HAS IT'S OWN REWARDS

    UAW is a crime family, just like they say never buy a American car built on Mondays or Fridays because the union members were hung over. Now you are crying because your union leaders spent or gave your Health Care and Pension funds away, and you jobs are gone, well you once had it good you had the world by the balls. Like where else in the world can a high school dropout make close to $80 dollars an hour for installing floor mats, you have milked the cow dry, I hope you have saved some of the big bucks that you made cause you will need it. On your next job do not forget to ask if they want that fries...

  • Report this Comment On March 06, 2009, at 1:20 PM, catoismymotor wrote:

    The goose has been killed. The cow has been milked dry. It is time for Metallico to move in and officially turn Detroit into one large scrap yard.

  • Report this Comment On March 06, 2009, at 1:43 PM, jerrybuza wrote:

    I tire of all of those blaming the poor working man, while the ceo's and their friends raid the company bank accounts. Ceo pay in this country is 485 times the rate of the average worker, Compare this to other countries and it is around 10 to 20 times, Are our ceo's better? I don't think so. Look at the mess we have now.

    Free market? Less goverement intervention? The lobbyist make all of the rules, if we had had more intervention during the Bush years, we would not the problems that we have now. Not a single Canadian bank has failed. You figure with how much our ceo's steal, they would do a better job.

    Years ago when Henry Ford paid his workers the outrageous rate of five dollars a day, his plan was to pay his employee’s a fair rate so they could purchase the products they were making. What a great idea. Now our ceo’s ship the job out so only they can make an outlandish amount of money, The heck with everybody else. It is time to wake up!!! Put the blame where it belongs, with those that have the control, not the working man.

  • Report this Comment On March 06, 2009, at 11:28 PM, SourRout wrote:

    To JerryBuza,

    Your comment about the Bush years is incorrect. He tried to implement more stringent controls on Fannie and Freddie in 2003, but was never brought to fruition. In hindsight, he should have done an Executive Order (if it was legal, I'm not sure whether he had the authority). Barney Frank thought is was a terrible idea......and we see where he is now.

    In regards to the UAW, they've made concessions but only because they saw the writing on the wall. Why does anyone think the UAW created the Voluntary Employee Beneficiary Association? So that regardless of what happens to the automakers, their retirees can still get their health-care benefits (which they don't pay a penny towards).

    They've given up the job banks, but they won't agree to wage cuts?!?!? Seriously? The Gov't wants the Big 3 to cut their contribution to VEBA in half, but I'm sure Ron Gettelfinger is vehemently against such an idea as their "Golden Parachute" may not be funded. Why can't UAW employees agree to pay a percentage for their health-care? I'm a Union Firefighter and I pay a portion of my pay for my family's health-care and I believe its completely fair.

  • Report this Comment On March 06, 2009, at 11:29 PM, SourRout wrote:

    To JerryBuza,

    Your comment about the Bush years is incorrect. He tried to implement more stringent controls on Fannie and Freddie in 2003, but was never brought to fruition. In hindsight, he should have done an Executive Order (if it was legal, I'm not sure whether he had the authority). Barney Frank thought is was a terrible idea......and we see where he is now.

    In regards to the UAW, they've made concessions but only because they saw the writing on the wall. Why does anyone think the UAW created the Voluntary Employee Beneficiary Association? So that regardless of what happens to the automakers, their retirees can still get their health-care benefits (which they don't pay a penny towards).

    They've given up the job banks, but they won't agree to wage cuts?!?!? Seriously? The Gov't wants the Big 3 to cut their contribution to VEBA in half, but I'm sure Ron Gettelfinger is vehemently against such an idea as their "Golden Parachute" may not be funded. Why can't UAW employees agree to pay a percentage for their health-care? I'm a Union Firefighter and I pay a portion of my pay for my family's health-care and I believe its completely fair.

  • Report this Comment On March 07, 2009, at 12:31 AM, jadeblade wrote:

    I don't work in the auto industry. I am a consumer of automotive products. When I was younger, I was a die hard American car/truck fanatic. When I got a little older, I made enough money to purchase a new truck, so I bought one. The third time I took my Chevy pick up to the car wash, I sprayed the hood and the paint flew off like a sheet blowing off of a clothes line. Long story short, it took GM 3 years to fix the coating issue on my truck, and for almost 3 years, I drove a ridiculous looking vehicle that I grew to hate more and more each time I drove it. People that saw me drive it probably hated it more than I did.

    About 10 years later, I saw two men die in a roll over accident driving a Ford Ranger. I saw the tread come off of a rear wheel and the driver try to correct the unstable fish tailing of the vehicle. He and his passenger were ejected as the truck rolled off the side of the freeway. They should have been wearing seat belts however, I was amazed at how the truck twisted like a slinky when the tire issue occured, and how a person like myself could see there was an obvious design flaw with the vehicle. As traumatic as it was to be the first person on the scene to call 911, it was nothing compared to watching Ford blame Firestone for the problematic rollovers of their vehicles knowing well that others were in danger.

    The reason I have a Toyota and a Nissan in my Garage is because they are good cars. When something is wrong with them, the warranty has covered the repairs...no questions asked.

    The reason GM, Chrysler and Ford are going out of business is because they made really bad products for a really long time, and people are sick of it.

    What makes me sad is that I believe that 99% of the workers at GM, Ford and Chrysler are tremendously skilled, smart and honest people. We know who the other 1% is. I hate to say it, but I think the best thing to do is let these companies die. Have the government provide low interest financing for the start up of three new American car companies. Give workers jobs at those new companies. Recruit some managment from the Japanese and/or German manufacturers.

  • Report this Comment On March 07, 2009, at 1:23 AM, karensboyfriend wrote:

    Alyce, was the uaw running the Motley fool the last few years when almost every recommended buy went in the toilet? Was the uaw in control when you failed to realize the banks were levered 50 to 1? and never issued a sell signal?

    People, stop the hate towards each other! It's not that any Union person is over compensated , it's only that so many people won't stick together and bargain together for a fair wage. Ain't nobody ever packed a lunch pail that got rich doing it.

    Yes , I worked Union most of my life, and I thank God I did, cuz when I fell and broke my back in 5 places and became disabled, I found out the company had ong term disability insurance and I got a settlement, So I needed a steady income and read tmf and bought ctrp at 56 and scur at 9 thanks to your advice!

    The only reason I can think of is the uaw must have been running the show down the tmf and you highly paid investment advisors are all auto workerw in disguise.

    THanks a bunch for warning us all about cds and other dirivitives.

    Come to think of it Geithner and Summers must be uaw also, cuz there still in my pocket stealing what's left of my retirement.

    Great write Gary923! Also, those firefighterw and police and Transit workers running into those buildings were also union members!

    Your quite the humanitarian and Patriot there Alyce.

  • Report this Comment On March 07, 2009, at 8:28 AM, jerrybuza wrote:

    To SourRout,

    Barney Frank thought it was a terrible idea? Bush and his republican buddies had complete control for 6 years, if he thought he needed to make a change, he should have made it. Mr. Frank did not have the votes to stop it. In 2003, Mr. Frank was merely the ranking democrat on the financial services committee. I believe the problem is, regardless what your party affiliation is, is just plain greed. Top to bottom. That being said, I still cannot blame the working man for any of these problems. It seems somewhat popular to blame the poor or working class. Leadership starts at the top. Maybe if some of the ceo’s, cfo’s and the other’s could get by on a only one million or so a year, the guys that make fifty or 60 grand a year might be willing to cut a little also.

    I am also a union firefighter. If my chief was making 30 million a year while the department was having severe budget problems, and then they called us greedy for not taking more pay cuts and other concessions?? I don’t think that would fly in my department, I doubt it would fly in yours also.

  • Report this Comment On March 08, 2009, at 5:06 PM, lordmorgul wrote:

    I spent 10 years going into debt to get my graduate degree in engineering and a solid technical background, work experience, and hobby-project experience to land a good job. I make just over $80,000/year, and have more than $60,000 in school loan debt starting my career at 30 yrs old. I live in california where cost of living is absurdly high compared to Detroit and the surrounding states.

    I find it amazing that anyone working a union job in an assembly plant would be paid $80,000/yr even with overtime pay included, in a state with cost of living more than 30% lower than california. Did you spend 10 years going into debt to learn how to do that job? No, you might have 10 years of job experience when you're making that much... but you were being paid during those 10 years, investing in your future, and building your pension. It didn't COST you money to get there, it was a process of earning along the way.

    I'll be paying my school loans for 10 years most likely, with it making a fairly big dent in my salary. I have 10 years less established wealth in a mortgage and possessions, 10 years lower 401k balance, and 10 years fewer to work now in order to establish that retirement... and my salary is effectively 30% lower than someone working in a UAW organized assembly plant who does not have those costs to overcome.

    Am I upset that they make a good living? No, I think they should be paid competitively and I understand the work is difficult, but anyone who thinks it is that much harder than intellectual work for many hours a day just does not understand how tiring that is. So you come home exhausted, do you have headaches all day and all weekend? Do I see that as being unbalanced? Oh yes I sure do.

  • Report this Comment On March 08, 2009, at 8:46 PM, FoolInYakima wrote:

    Both he UAW and the manufacturer's can be pointed at for their crisis.

    Yes, the UAW has over 1 billion in net worth, which comes from member dues. Seems like they are charging quite a bit for dues. Perhaps they could sell of a gold course or some of those assets and lower the dues for its members.

  • Report this Comment On March 09, 2009, at 9:08 AM, realityifneeded wrote:

    what a stupid article. Unfortunately people believe it. No one in America wants their neighbor to make more money and have more benfits than they do. Thats right- keep your neighbor down.

    why can salary workers get tons of benefits, raises, cash incentives, but don't let a UNION WORKER get anything, those greedy fools. No one cares what the executives get as long as the hourly worker next door is repressed and treated poorly. whast wrong with America is peoples self centered, hateful ideas, and big business knows this and uses these fools.

  • Report this Comment On March 09, 2009, at 10:33 PM, tkandcrew wrote:

    I live in a union town in Michigan and have watched the union demands close one shop after another until the town is a mere shadow of it's former self.

    Now the democrats owe the unions big time and are about to push through the biggest union payoff ever.

    If you think the unions have dragged down the big three, wait until we have the "Employee Free choice Act" shoved down our throats. The unions know if people are given a choice (secret ballots) they usually chose non union shops (that's why union membership has dropped to about 7% of employed workers (down from around 40+% of the work force).

    With the so called Employee Free Choice Act (which is anything but free choice) union thugs will force nonunion employees to sign the card or pay the consequences (at least in misery and possibly with their lives and the lives of their families).

    The check card v.s the secret ballot is the most un-American piece of legislation to come down the road in my lifetime.

    Contact you representatives in Washington and stop this Obamanation before it's too late!!

    Our nation can't afford the UAW writ large!

  • Report this Comment On March 10, 2009, at 12:48 AM, shmues wrote:

    "mpyer" makes a lot of sense. During and after the two oil embargos in the 1970s, Americans kept ordering larger gas guzzlers with all the bells and whistles. Management could afford to ignore the business share being eroded by foreign auto producers building smaller fuel efficient cars. As management and labor both wanted

    more of the pie, and Congress after Congress proved to be unable to do anything substantive by way of getting us off foreign oil, it was only a matter of time before American auto manufacturers lost control of the auto industry to European and Asian companies who were building the smaller, more efficient cars that people wanted

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