While Washington is considering a bailout plan for the American automakers a large portion of the American population is standing against it. It is time to start holding those who make poor financial decisions accountable. America is already in recession and while we are looking for financial relief the government just shouldn’t be the answer.
Part of the problem for the auto makers is that the inmates run the asylum. The United Auto Workers Union is so strong that the auto makers literally can’t cut their overhead by laying people off and shutting down plants. This forces the companies to spend money that they don’t have and now they and the union need to lay down in the bed that they’ve made.
Barney Frank (D-Mass.) is trying to be the savior for the auto makers by presenting a $25-billion auto industry bailout plan.
"A collapse of the American automobile industry would be the worst possible thing that could happen at a time when we are already weakened," Frank told reporters two weeks ago.
"We're not asking the taxpayers to throw good money after bad," Frank said. There will be "protections about getting it repaid," he said. "The consequences of not doing it will be worse." Frank did not divulge details of the bill.
Spending tax payer money won’t change the problem with the auto industry because it is a twofold issue of poor budgeting and a sense of entitlement by the members of UAW. Almost immediately after Frank made his proposal UAW President Ron Gettelfinger urged Congress to act immediately to provide a separate, additional $25 billion in loans so auto companies can meet their health care obligations to more than 780,000 retirees and dependents.
Giving candy to a screaming toddler doesn’t solve the problem of having a spoiled child it only makes the problems worse. Like most Americans my health insurance went up this year beyond what I could afford. Instead of lobbying for someone to pay it for me I decided to go to a less expensive plan. That is beneath the people of UAW and a government bailout won’t change that.
As to who is ultimately at blame for the financial crisis of the auto industry Captain America and I are divided. I ultimately blame the companies and he says that the blame rests on the shoulders of the union.
Dolphinfan: I don't fully blame the unions for the financial mess that the auto makers are in. I blame the auto makers for over-spending. The unions were simply trying to create the best deals possible for their members in terms of benifits and salary. Don't blame them for serving the purpose for which they were created.
Captain America: The Unions have and have had their place in history...maybe even in the future. Let me just steer clear of the extremities of history and the fact that labor unions have socialism in their DNA.(1) Their influence in our time can be most clearly seen in the cleaning up of the work place.. During the Great Depression unemployment rates were at 25%, wages below acceptability (due to applicant to job ratios), and management out of control and "brutal."(1) Unions ultimately brought the work place into control and became the voice of the employed. In short, this is and can still be good.
Today however, Unions have pushed the envelope beyond reasonable relationship negotiations to full-out greed. Allow me to illustrate. It is amazing the info that can be found with simply google words like: auto union benefits. Very generally speaking the auto unions have amassed a large benefits package for its employees. Benefits are great and need to be preset, but among total retiree benefits (large sums) and very desirable working benefits, the unions have even negotiated what is known as "job banks." This allows "laid off" or "misplaced" workers to sit and wait for a job and keep 95% of their wages.
In 2003, I was laid off from a national event planning corporation. I received unemployment....which means a small government funded portion of my former employment. I think you see why this job-bank benefit is on the chopping block in order for a bailout to happen.
But, why I said in paragraph one that I would avoid the 'socialist' seed in union formation, I found that it is very alive today. You may read the full article, but what really made me read closer and reread a paragraph was the following:
"The prostration and complicity of the UAW are a testament to the utter failure of so-called labor organizations that base themselves on the defense of American capitalism and opposition to socialist policies... Their labor...created the vast wealth that was monopolized and squandered by the corporate heads and the American financial elite.
"They should oppose the bailout schemes being worked out between Obama, the Bush administration, the Democratic Congress and the UAW and prepare for mass strike action to defend their jobs and living standards. This should become the starting point for a political struggle to mobilize the entire working class against Wall Street and both of its parties and to fight for a socialist policy based on the nationalization of the auto industry and its transfer to public ownership under the democratic control of the working population. (bold added)
...Above all, this means joining the Socialist Equality Party and building it as the mass political party of the working class." (2)
THIS BLOWS MY MIND! I am glad you voiced this thought, because my support research really brought some good info to light. Further, Freep.com writer, Tom Walsh, states in paraphrase: "we (Americans) should 'ignor the booing' and champion these bailouts." (3)
No way! I simply cannot imagine this Great Country as a Socialist entity....but it is sadly riding that train! I speak out against Tom Walsh and the Socialist party.
Socialism is the reason we are in this mess:
1) Welfare out of control: illegals receive free medical in our country; sexual irresponsibility is rewarded with government stipends (WIC);
2) Devalued Education: school systems teach to the lowest common denominator causing other countries to excel and our kids to loose education interest;
3) Bad Loans: in the last 10-15 yrs those that cannot afford homes were allowed to obtain mortgages that are now recognized as 'junk, trash, or otherwise undervalued;'
4) Medicare/medications are out of control
5) Big Government: new government entities, pork spending and overall governmental growth
And now, bailouts. We are growing the 700 billion to phenomenal proportions (4) and the unions are just a part of the mechanism charging us full speed to destruction.
I do not blame the employees - except those that may be on the bandwagon to greed - rather I empathize with them regarding fear of unemployment. But I ask this question: "Is it fair for all Americans to pay for their excessive employment benefits and salaries?" When unemployment is slowly rising across America, what is next? Fast food bailouts, Wal-Mart bailout?
Americans need to wake up, get their head out of the sand or our collective rear and realize we cannot fund every financial mishap. Hey, I have debt. My wife owns a Tea Room - we don't make much and have start up debt....should we ask for a bailout?
Dolphinfan: OK – But isn't the fault ultimately at the feet of the auto manufacturers for allowing the union to bully their way in? Economic responsibility should be on the one's paying the bills and not actually on the ones doing the billing. All across the country you read and hear about layoffs due to this "non-recession" we are having. Why can't Ford and GM just layoff part of their workforce and call the union's bluff. If the money isn't there it isn't there. If I were to spend more money than what is in my checking account then the bank is coming after me and not the people I wrote the checks to.
Captain America: Excellent point and really at rock bottom deduction, should be the conclusion that one would come to. My checkbook is not bottomless either!
Why any business owner would allow the bully tactics is beyond me. Ford, GM, Chrysler, the airlines, railways, miners and others that have unions should not allow unreal demands or give into concessions. Thus, it is kinda like the age old question: "Which came first...the chicken or the egg?"
Do the unions have the blame for pushing so hard and threatening not to work? Or does the corporation have the blame for sitting like bumps on a log and just letting the work force run all over them?
At one time, unions had good goals in redefining the work atmosphere, treatment and compensation. Keeping management in check and holding them responsible for good working conditions is still needed. Unbridled power in the hands of management is equally as bad - Enron, Worldcom, airlines, and day to day jobs. So, had they stopped there, all would be good. In my business, if someone threatened me for more benefits and wages and I was already compensating them fairly within the confines of the law....then they'd walk. There is someone else out there that would gladly fill their shoes.
It is the fact that Obama is in bed with these guys and the card check is going to open the market for unions in areas they were previously not able to go. Further, union members ought to highly oppose these card checks. In Vegas, union employees were threatened with their jobs if they did not follow the card check correctly. Manipulation, threats, pressure and intimidation will force employees (union members/prospects) to follow union requirements/choice over what might otherwise be their choice.(1)
In conclusion, I think I would answer your question by saying unions have too much power and have overstepped their functionality and are driving businesses into the ground because of their greed. However, I would say that I love your idea about the auto manufacturers calling their bluff and simply firing them. It should be done in respect to salvaging the industry and putting a halt to unions in general.
(1) http://en.wikipedia.org/wiki/Transport_Workers_Union_of_America
(2) http://www.wsws.org/articles/2008/nov2008/uawl-n22.shtml
(3) http://www.freep.com/article/20081125/COL06/811250391/1210/BUSINESS
(4) http://www.glennbeck.com/content/articles/article/198/18550/
