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Wednesday, November 19. 2008
Here is Why
For the past five days it’s been a baffling riddle: why are the Republicans so adamant in their opposition to the bailout — loans — to the Big Three automakers? If there’s any American industry that epitomizes the U.S., it’s the behemoth auto industry. America is a nation that grew up on automobiles, came of age when auto making was new and as America grew, so did American automakers.Eventually, the small, niche automobile companies either fell by the wayside or were ate up by the Big Three and by 1960, Ford, Chrysler and General Motors were leading the greatest industrial giant in history. They could swagger and they could do as they pleased, the Big Three owned the automobile industry.
My favorite cars of the 1960’s and ’70’s: 1963 Corvette, Chevy SS 396, Chevy Camaro Z28, Plymouth Roadrunner, Dodge Challenger R/T Six Pack, Plymouth Hemi Cuda, Plymouth Duster (340), Ford Mustang Boss 302 and of course the GTO — any year.
Of course the people opposing the Big Three bailout bring up the obvious reasons: Detroit has not kept up with the times, identified more with gas-guzzling SUV’s, pickups and low café standards for carbon emissions. Not to mention, everyone knows things like door handles and car radio/stereos break quickly. The quality just seems to suck.Then there are the rather generous executive salaries and bonuses. That never looks good to the public and it’s an easy whipping post for detractors, executive bonuses and perks. Insurance company AIG came under fire for having conventions and celebrations that cost hundreds of thousands of dollars, complete with really lavish and extravagant benefits. Spa treatments being one of the most popular to spotlight.
It’s a red herring though, in the case of AIG. Those conventions are for agents who have done well and achieved sales goals. The events are rewards for doing a great job. I have friends in the insurance business and these four-day affairs are serious incentives for attaining their quotas and goals.
The Big Three have similar bonus perks for their dealers and auto salesmen and we can be sure the opponents of the Big Three bail out will bring them up. That’s bullshit though, especially if these perk weekends are for salespeople who excel at their jobs.
Sales is a tough occupation. Having dipped my toe in it along the way, I don’t make jokes about car salesmen or deride insurance sales. For those people who live (and sometimes crash) on the strength of their commissions, the possibility of going on an all-expense paid trip to Maui or a five-star resort like Acosta in Carlsbad is a great goal. It helps keep their eyes on the prize. They earn those trips.What the Republicans like to throw into their derision of the Big Three are the labor costs, the highest in the world. The employees of the Big Three are the best-paid autoworkers in the world, with salary and benefits combine to a reportedly $73.00 an hour. But that’s no longer true.
Here’s one of the things that people like to bring up: health care costs of employees. That costs a lot and many people believe automakers spend too much on employee health care. The other benefit that comes under attack is the pension. At this time, the U.S. auto industry is one of the few that actually guarantees its employees will have a pension when they retire, one that ensures their retirees will have a livable income in their later years.
The reason these two costs have spiraled out of control in the eyes of Republicans, who have been bashing the industry for decades, has been the UAW: the United Auto Workers Union. And it really isn’t the salary and benefits the Republicans abhor, it’s the political and social power the unions wield, or once held, over the political spectrum.In the 1970’s the unions and the management of the Big Three began to work more in partnership with one another to ensure everyone involved benefited from the industry. No one made money during strikes, the point of labor negotiations and the Big Three autoworkers made great gains in the process.
There have been some serious chasms in the following years; G.M. gave filmmaker Michael Moore his start in 1989 when Moore documented the closures of G.M. plants in and around Flint, Michigan by trying to speak with then G.M. chairman Roger Smith. By closing its headquarters plants in Flint, G.M. sent over 50,000 to the unemployment line. The film is called Roger and Me.Ronald Reagan can be credited for weakening the strength of unions when, in 1981, he fired all of America’s civilian air traffic controllers (PATCO) after they went on strike. The upshot: in 1980, to win PATCO’s political support, Reagan had sent a letter to PATCO president Robert Poli pledging to put in place many of the changes to the job the union went on strike to attain.
Today, air traffic controllers are still in the most stressful of occupations, are still under-staffed and working far too many hours. But, the government is keeping the costs down!
To this day, conservatives want us to believe it’s the unions that are destroying the American work force, that it’s the unions making working conditions untenable across the land. I heard it just this morning from former Texas Congressman Dick Armey. It’s all about getting rid of the unions. None of the Republicans will say it of course, they need the votes of the union rank-and-file, so the conservative politicians bash union leadership as if the union members are held captive.The reality is, union membership makes up only seven percent of the U.S. work force. Unions aren’t the problem, just last year the UAW negotiated contracts that virtually eliminated the $30 per hour difference between U.S. automakers and those who work for the Japanese automakers.
As the debate unfolds over the Big Three bailout, listen to the conservatives who will speak of restructuring and getting rid of top management. And then listen to them talk about labor costs and you will hear that point become their focus.
Which is why conservatives like the idea of letting the Big Three file for bankruptcy. It’s an avenue for abrogating the union contracts. Thousands of autoworkers will lose their jobs — even the Republicans admit that — but that’s the price the conservatives are willing to pay to rid America of the powerful UAW. What the hell, it’s not their jobs on the line. Just this year Ford alone has cut over 5,000 jobs already.
Clearly, Republicans/conservatives don’t believe working people deserve affordable health care or pensions to secure their future. They will deny that, but their words and actions tell the story.The truth about why the Big Three is in trouble is multi-faceted, chief among those problems right now being the economy. Banks and lenders are not giving loans to businesses or consumers. Maybe, the next round of financial bailout money should go to lenders who will give the loans to the automakers who need them.
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