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Unions Aren't To Blame For Automakers' Woes

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Health care coverage, pension programs, and guaranteed vacation time for union workers is not what destroyed the auto industry. There were no union shops at AIG, Bear Stearns, Freddie Mac, and Shearson Lehman. Still, those poorly-run companies failed for the same reason America's Big Three failed. It is misfeasance, malfeasance, lack of vision, and management greed that is at the heart of the failing auto industry. But demagogue senators like Richard Shelby from Alabama and Jim DeMint from South Carolina see an opportunity in all of this management failure. They see this as an opportunity to vilify the UAW and every other labor union that has a goal of improving the lives of American workers.

The Economic Policy Institute (EPI) has studied the impact of American labor unions for a decade. They have given us the data about why the American Labor Movement matters. According to the EPI, the efforts of unions to raise compensation for their members also increases the compensation packages for nonunion workers by about 20%.

Nonunion middle-wage workers and blue-collar workers without college degrees realize huge benefits from the efforts of organizations like the UAW and AFL-CIO. One aspect of organized labor that corporate management is most fearful of is the critical role labor plays in legislative activism for all workers in issues like workers compensation for injured workers, unemployment insurance, workplace safety, wage and hour increases, and health coverage requirements.

Individual, nonunion workers are not the ones who pay for lobbyists to create legislative change. Union blue-collar workers are the ones who jump on buses bound for Washington, DC to demand fair treatment for all workers. If that centralized, organized mouthpiece for labor is destroyed, then so is the only advocacy vehicle available to the nonunion worker. Then, the Walmart formula for workers' rights becomes the new ugly reality for all of America's work force.

Senators like Shelby and DeMint have much more kinship with GM's Rick Wagoner who was paid $14 million to lose $39 billion for GM in 2007. Those senators get their campaign money not from organized labor but from characters like Alan Mulally and Robert Nardelli who flew into DC on their private jets to ask for help when collectively, they personally made $120 million for losing almost $4 billion last year at Ford, and Chrysler. These same characters chose to put up millions to lobby against national health care. They also unleashed "K" Street to fight congressional efforts to improve fuel efficiency standards on their gas guzzling products. But today, they are telling us that healthcare costs for their workers will bankrupt their companies. And they are telling us that they can't sell the fuel-hog dinosaurs they ordered their workers to build.

In light of the long-time lucrative and cozy relationship conservative senators like Shelby have had with the auto industry's country club gaggle of CEOs, you can bet there is more at work here than a senator's desire to protect taxpayers. Eight years ago, conservative strategists boldly made the statement that America's unionized labor needed to be crushed in order to end labor's political clout. The bankruptcy of GM and Ford will help accomplish just that.