Big Media: Screw the Auto Workers
Memo to the traditional media: you want to see the auto industry go down? Fine. But, at least try to give the facts about what workers have undergone in the industry -- an assignment that most of the traditional media could not live up to in its coverage of yesterday's hearings on the proposed bailout.
The facts are that the workers in the industry are not responsible for the mistakes of the executives who have mismanaged the companies, now and in the past. The meme -- this is a right-wing, anti-union meme -- is that UAW workers continue to coast along on some "gold-plated" lifestyle while the industry craters.
And the traditional media plays right along. I scanned the major media and, with one exception, could not find any significant reporting of the facts laid out yesterday about the cuts, concessions and job losses that workers have taken on in a bid to save their livelihoods.
In the case of the Washington Post, New York Times and Wall Street Journal, there was no reporting -- ZERO -- about the parts of the testimony of UAW President Ron Gettelfinger that detailed the hits UAW members have taken just in the last few years (and some didn't even bother to mention that Gettelfinger was even in the room).
Here is one exception: The Los Angeles Times--
Alan Reuther, legislative director for the United Auto Workers, rejected the idea -- voiced by more than a few members of the House and Senate -- that overly generous union wages and benefits contributed to Detroit's woes.
"We are obviously opposed to any more concessions being required of workers and retirees," Reuther said. "UAW members already made huge sacrifices in the 2005 and 2007 contracts. The last contracts have been called 'transformational.' They effectively eliminated the cost gap between the Big Three and the foreign transplants in terms of labor costs."Wages for new employees were slashed 50%; new employees do not get any guaranteed retiree health benefits; they also do not get the traditional defined-benefit pension plan," he said. "And the healthcare liabilities for existing retirees will be transferred to an independent [entity]. Bottom line: The workers and retirees have already accepted major cuts."
Below is an excerpt from Gettelfinger's prepared testimony. To those who would say that this is self-serving rhetoric, I would point out that none of the auto company executives disputed the facts in this testimony. In fact, at least two of the executives -- Alan Mulally of Ford and Rick Waggoner of GM -- agreed with Gettelfinger's description of the UAW's concessions.
Some commentators have asserted that "overly rich contracts" negotiated by the UAW are to blame for the companies' current situation, and suggested that workers and retirees should be required to take deep cuts in their wages and benefits. This totally ignores the recent history in the auto industry and the facts regarding wages and benefits at the Detroit-based companies.
The truth is that in 2005 the UAW agreed to reopen the contracts mid-term, and accepted cuts in workers' wages and in health care benefits for retirees. Then, in the general 2007 collective bargaining negotiations, the UAW agreed to what industry analysts have called a "transformational" contract that fundamentally altered labor costs for the Detroit-based auto companies. This contract slashed wages for new hires by 50%. Furthermore, new hires will not be covered by the traditional retiree health care and defined benefit pension plans. In addition, this contract stipulated that beginning January 1, 2010 the liability for health care benefits for existing retirees would be transferred from the companies to an independent fund (a Voluntary Employee Beneficiary Association, or VEBA). This agreement has subsequently been approved by federal courts, which have appointed a majority of the trustees who will be independent of the UAW and responsible for managing the VEBA. Taken together, the changes made by the 2005 and 2007 contracts reduced the companies' retiree health care liabilities by fifty percent.As a result of all these painful concessions, the gap in labor costs that had previously existed between the Detroit-based auto companies and the foreign transplant operations will be largely or completely eliminated by the end of the contracts. Indeed, one industry analyst has indicated that labor costs for the Detroit-based auto companies will actually be lower than those for Toyota's U.S. operations. Thus, the truth is the UAW and our active and retired members have already stepped up to the plate and made the hard changes that were necessary to make our companies competitive in terms of their labor costs.
It is also important to note that union negotiated work rules cannot be blamed for the current problems facing the Detroit-based companies. According to the Harbour Report, the industry benchmark for productivity, union-represented workers are actually more efficient than their counterparts at non-union auto plants. And union-made vehicles built by the Detroit-based auto companies are winning quality awards from Consumer Reports, J.D. Power, and other industry analysts.
We can have an honest, public debate about whether the auto industry should receive taxpayer dollars to keep it from sinking. But, in my opinion, the traditional media has played an irresponsible role in feeding the pro-business, anti-union line that UAW workers are "overpaid".
Of course, this is the same line that argues that America would be a wonderful place if all workers just accepted the magic of globalization, where Wal-Mart is the future and unions -- and the decent wages and living standards they brought -- are a relic of the past.
Read More:
Should the Government Bail Out the Big U.S. Three Automakers? HuffPost Bloggers Weigh In
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AH!! The middle class feasting upon each other. Just what the robber barons want. Why on earth are people dumping on middle class(yes, MIDDLE CLASS) workers while top execs pocket 10's of millions of dollars in salaries? It's OK to let millions of hourly people lose their jobs while Hank(Mr. 400 million) Paulson gives your money to his favorite charity-Goldman Sachs? This is so sad, wishing the demise of the working class. I am glad that someone is clearing up the perception that union workers make nothing near this amount. Too bad we'll never see it on MSM. The plant where I worked-past tense- at paid me $24/hr. When we went on strike to keep retirees from losing their healthcare, the newspapers and television news kept repeating our wages were around $65/hr. You can't imagine the terrible things said to us on the picket line. I know how much I made. I saw my paycheck every week, but you couldn't change people minds after that came out. Pathetic.
No American will give a r### a### about whether or not the "bail-out" was "socialism" or "capitalist pillaging" of the taxpayer--they will only care about the economy improving, their household costs staying manageable, the cost of health care and college for their kids. The MSM likes to frame the debate as a "right vs. left" discussion, with the stupid Repulicans arguing about the tyranny of unions and the bleeding heart liberals arguing about "main street" vs. "wall street".
This is where Obama steps in with the real solution: a pragmatic set of actions that will actually work to stimulate the economy, re-build the infrastructure and enhance our competiveness in the global economy.
If single-payer health care, a gasoline tax, rolling back the tax cuts for the top 1%, help for the auto industry, (which in my view would mean that the executives take 50% salary cuts and the unions would also take an additional 10% tax cut, just for starters) all combine to achieve the fix for the economy, no one will care about ideology!
It really is odd.......
"Nyaaa!! let the bastids fail...we don't neeed 'em....tho
How much do execs at AIG make??
Zillions for Wall St.... O for auto workers?..
Methinks we're being manipulated again!
tm
Who owns the media?
Why does everyone call this a bailout? It is a low interest loan. I never hear the media or commenters say that. This isn't the same thing as the 700 billion to the banks. And really, if the banks would loan the money like they are supposed to do then GM might not need the loan. Bush has given the banks billions to loan and the banks are sitting on it. Go try to get a loan, it is almost impossible.
We need banks. We don't need US auto manufacturers.
My observations have been quite different than Mr. Tasini's. First, this is a complex issue which means the MSM should be the last place anyone might expect thoughtful, well reasoned coverage. Second, regardless of whatever firewalls media organizations say they have in place between sales and editorial, with political campaign revenues no longer part of the cash flow the automobile industry has rekindled its place as a leading source of income. No sense upsetting your best customer.
Lastly, with a fair amount automobile consumers being burned by the industry's practices at one time or another, it makes for an easy morality tale. No heavy lifting required by your news team.
Video of corporate executives hopping on thier private jets and factory floor shots of above average compensated workers barely breaking a sweat in their ergonomic workstations begging for relief earns little sympathy from the public that would foot the bill.
FOR NAFTA AND CAFTA TO WORK THE WAGES IN THE USA HAVE TO COME DOWN !!!!!!!!!!!
For them to work for WHOM?
The Global Corporate Elite, of course.
Fascists use hard economic times as a way to create scapegoats and thereby acquire more power. Republicans love to demonize union workers who earn living wages and decent benefits -- auto workers, teachers, retail workers, any and all of them.
When you hear Republicans denounce a union wage, but mysteriously say nothing at all against crooked financial CEOs who are getting billions in taxpayer bailouts, you can see the real goal of the GOP in outline.
They seek to have a workforce with minimal education that works for the lowest wages and benefits consistent with keeping them alive long enough to be of use, and only that long.
As the middle class is systematically wiped out, we'll go back to the bad old days of labor riots, employer thugs, company stores, debtor prisons, 80-hour work weeks, child labor and all the other horrors workers were forced to endure prior to unionization.
It should be quite a history lesson for the formerly middle class people who were stupid enough to support the party of the plutocrats.
How very true. This, for the unititiated, is a textbook example of Naomi Klein's "The Shock Doctrine", in which "disaster capitalism" is in play to effect a sea change in the playing field.
To wit: the corporatist right has decided to use this particular financial crisis in the auto industry as grounds to blow up the auto Union, for once and for all. You see, it just "can't be helped under the circumstances", etc. It's that, or you'll end up with no auto industry at all.
And they mean it. FAILING that, these corporatists are quite willing to have GM blow up entirely. Whatever it takes, but the Union is GOING.
Meanwhile, the Big Two (!) must necessarily die eventually, and that leaves... hmmm... nothing but non-Unionized workers in other Amerrican cities, working on "foreign" cars, made in the good ol' USA.
How convenient.
WMDs and mushroom clouds, quick stampede a gullible nation into Iraq. Wall Street steals too much, quick stampede a gullible (and bought off) Congress into a bailout. Oil prices skyrocket, ignore the unbridled speculation and stampede a gullible nation into drill baby drill non thinking. Auto industry craters in recession, quick stampede a pandering Congress into a bailout.
I disagreed with the bailout of the robber barons of Wall Street. The Nation would have been better served had indictments been handed out rather than taxpayer money. The barons desperately needed jail time. Likewise the auto industry's executives desperately need to be put to pasture. The shareholders have not done this. Why is it the Government's responsibility to salvage what the owners of the auto companies have mismanaged? Union jobs and those dependent on their spending is the proposed rationale. No matter how you slice it these jobs pay about 3 times the average manufacturing wage. True there have been recent concessions but it may not be enough. A bailout is ill advised. What is needed is a restructuring that removes present leadership, recapitalizes the industry, pays the shareholders very little with a reissuance of stock to the Government and renegotiates in a meaningful way the labor contracts. These negotiations could include a minor ownership position in lieu of wages. This also speaks volumes on the need for Government sponsored health care. Bailouts subsidize malfeasance and irresponsible behavior.
Things would be tremendously worse right now without the financial bailout. Things really started to first get really bad when Lehman Brothers was allowed to fail. Most policy makers realize in hindsight it was a horrible idea to let Lehman fail. I think most will realize after the fact that it was a bad idea to let the auto makers fail too, but only time will tell.
I ran out of the 250 words limit and deleted my strict veiw of the Wall Street restructuing. It would have split out the retail brokerages, allowed the FDIC to continue with commercial banks and recapitalized investment banks without benefiting shareholders or executives. The Government would have held the reissued stock until it could be sold. No bailout, just a change in management and ownership. Any firm not accepting this would be allowed to fail.
"...in 2005 the UAW agreed to reopen the contracts mid-term, and accepted cuts in workers' wages and in health care benefits for retirees..
Not that it would change the inevitable, but reports of wages and benefits (and resulting bombast) may have not been entirely fair and balanced.
Beautifully put. I'm appalled and saddened by the comments of people who don't even seem to have read the blog, offering no counterfactual arguments but rehashing their unfounded opinions. These folks (a) have zero understanding of 20th century history and specifically labor history and (b) are so warped by their own experience as underpaid, undervalued workers that they begrudge living wages to their fellow Americans and willingly fight over the crumbs scattered by the ruling class. Workers of the world unite, you have nothing to lose but your chains? Solidarity Forever? An Injury to One is an Injury to All? Or...conti
It's one thing to pay high wages when business is good, but it's another thing for a company to be saddled with ridiculously high labor and legacy costs when they are losing money- a lot of money. If costs are higher than revenues, then a company loses money; and when a company loses money long enough, they go out of business.
You're right, something should be done about the ridiculous labor costs--particularly executive compensation. Any company that is paying 8 or 9 digit salaries clearly doesn't need a bailout, it obviously has money to burn.
Frankly, any company where the CEO makes more than 30 times the average salary shouldn't be considered for any bailout, because it isn't even trying to manage its costs.
One note: None of the SUCCESSFUL car companies pay higher ratios than that. Only in America does executive compensation run so ridiculously amok. Paying people to make your product isn't a luxury, but paying for a private jet and paying anybody an 8 digit salary is.
I am impressed by the chutzpah required to go before Congress and say "I need money because the company I am paid 100 million a year to run is broke." It's like asking for a loan to pay for your online porn subscription.
My wife is an Emergency Room Nurse, with 20 years experience. Deals with life and death every day. Paid less than a bus driver, and way less than an unskilled assembly line worker who's only responsibility is to tighten the same four bolts over and over again. Some would argue that that is why the auto worker is paid well: the tedium. I say that's what an education is for.
That the unions have a long history of producing Monday cars (got a morning hangover), Friday cars (can't wait to get out for the weekend), and protecting employees who purposefully sabotage product. Yes, these may all be problems of the past, but all we ever hear from them, and all we have EVER heard, is: "MORE MONEY"! So for now, and a long time to come, my cars are built by German, and Japanese workers who still seem to take pride in the car they produce. The only thing the UAW worker takes pride in is the pay cheque. They, and the big 3 are pretty much 'damn the consumer'.
Never worked on an assembly line, have you? Most people who have this attitude (disdain) for factory workers really don't know. Another thing, the Mon-Fri. 8 hr. shift disappeared years ago. I've seen a lot a people quit at my plant over the scheduling. As for the "MORE MONEY" meme, unions haven't asked for wage increases in about 10 years. Negotations have really been about keeping employee/retiree benefits(h
Youre right about the physical demands, and I don't think I could take 1 part, 1 place all day: On one clip, I saw one worker putting lug nuts on a car with one hand and playing with his shorts with the other hand at the same time. It takes real dexterity to do that, and a way to relieve the monotony!
I am so happy the media has finally taken over. I've lived under a dictatorship, socialism, and so called democracy. And now I finally have found media socialism to be the form of thinking I enjoy the most. Go Obama...be happy and duplicate and enjoy opinions that the media presents to us. And...don'
one issue not being addressed here is the involvement of the finance industry with the automotive industry.
TRADE IN VALUES
the big three can build the best cars on the planet, but until the financial institutions value the
big three car at trade in as high as it does say an equivilent toyota....
assume that the toyota has held its value and was the better value to begin with.
The problems of the Big Three are way beyond union pay and benefits. But it filters thru the economy and cities big and small like a virus. Saving them is just as crucial as saving wall street.
A suggestion I made earlier, move all the union workers to medicare. It would save the auto industry more than they are asking for, for this year and years to come. It would also free workers to retire,
and best of all, the industry wouldn't get their hands on any real money - it would stay in the treasury,
and the weekly premium deductions now being paid to insurance companies would also be paid to the treasury, And we would be one step closer to universal/single payer insurance.
Please can someone tell me if the German, Japanese and other auto-transplant companies have unions in their home countries?
Also, I think its odd that the auto-transplant are mostly located in the southern states where they get huge tax breaks and incentives Nissan moved it North American headquarters here to TN and it was estimated that the state paid $150,000 per job in tax breaks
yes, they do. they also have "socialized medicine."
Union-busting, and the multi-trillion dollar bankster bailouts are both designed to keep rewarding the few at the expense of the many.
“Among the most outspoken Senate opponents of the proposed auto loan is Richard Shelby, the ranking Republican on the Banking Committee. Not accidentally, his state, Alabama, is home to non-union plants operated by Toyota, Honda, Mercedes and Hyundai.”
http://glo
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