December 9th 2008
s part of any automotive bridge loan to nowhere, Ron Gettelfinger, president of the United Autoworkers, must be ousted from his position and strict oversight of the UAW by a federal overseer must be imposed.
“You’ve got to consider new leadership,” said the promoter of this idea. Gettelfinger, the source said, “has to move on.”
Actually, the quote is from me and is a word-for-word reworking of a quote from another guy who has to move on, Chris Dodd (Dufus, CT), who was talking about Richard Wagoner, chairman of GM. The senator, who brought us the mortgage meltdown and the current recession almost single-handedly (hat tip to Barney Franks, too), is quick to blame management for GM’s ills – and management has plenty of blame to take – but his stubborn refusal to admit the unions’ contribution to the fall of the American auto industry is proof (as if we need it) that the Dems are not to be trusted anywhere near the US economy.
Gettelfinger would disagree. Surprise!
As Detroit’s Big Three teeter on collapse, United Auto Workers President Ron Gettelfinger said yesterday that the problem is not the union’s contract with the automakers and that getting the automakers back on their feet means figuring out a way to turn around the slumping economy.
“The focus has to be on the economy as a whole as opposed to a UAW contract,” Gettelfinger told reporters on a conference call, noting that the labor costs now make up 8 percent to 10 percent of the cost of a vehicle.
The lack of credit may have pushed the Big Three over the edge, but insane union contract and benefit packages shoved them to the edge, and Gettelfinger’s recent move to offer concessions is proof of that union-made pudding ($39.95 a pound; quit complaining). Says the Heritage Foundation:
UAW workers earn $75 an hour in wages and benefits–almost triple the earnings of the average private sector worker. Detroit autoworkers have substantially more health, retirement, and paid time off benefits than most Americans. These benefits, and a JOBS bank that pays UAW workers nearly full wages to not work, have been a major force driving the Detroit automakers’ current fiscal woes.
The JOBS bank is on the chopping block as a possible union concession, but many rank and file workers are opposed to offering up the benefit, so who knows how the vote will go. Here’s how the paragraph above looks as a graphic:
And wages are just the tip o’ the iceberg. Heritage also computes that just 38 percent of a Chrysler employee’s total compensation is in his wages of $75.86 an hour; the rest comes from his benefits package, of which health care is the largest chunk. No wonder Gettelfinger is a loud advocate of dumping this cost on the government through a universal health care system.
Congress and the president are talking about a car czar to oversee any loan to the manufacturers, and the AP story mentions that NaPo wants the czar to have the ability to to set guidelines on manufacturer behavior, and the ability to pull loans if the manufacturers don’t follow the federal rules. Bush wants to give the czar the ability to force the companies into bankruptcy if they don’t do enough to cut costs, which obviously means labor costs – including the salaries of both management and labor.
I’m not hearing calls for the car czar to impose a similarly heavy hand on the unions. I’m not hearing from Congress any shouts for the head of the union’s president. I don’t mean to put all the blame at the UAW’s feet, since management of American automakers are to blame for (1) not responding quickly enough to the market, (2) allowing a dreadful spell of low quality and (3) not pushing back harder on the unions.
Still, a hefty dose of blame should be placed on the UAW if we have any hope of learning from the lessons of the crash and giving the American economy the long-term structural adjustment that’s needed to be competitive in a global marketplace.
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