Main Street's Engine - By Ron Gettelfinger

[Gm_Tooler]

Link:
http://www.washingtonpost.com/wp-dyn...111303345.html

Main Street's Engine By Ron Gettelfinger
Friday, November 14, 2008;

It's time to stand up for the Main Street economy.

In the face of a global credit crisis and a worldwide economic downturn, U.S. auto sales have slowed to a crawl. As insecurity spreads throughout the economy, consumers are delaying major purchases -- and those who do visit auto showrooms are not finding credit available on reasonable terms.

The domestic auto industry simply cannot succeed in today's unstable economic environment without immediate help from the federal government. And the costs of failure are unacceptable.

This isn't just about three large Michigan-based companies and the 240,000 people who work for them, including 150,000 of our members. It's also about thousands of car dealerships that are anchor businesses in cities and towns across America. It's about thousands of small and medium-size businesses -- employing millions of workers -- that provide parts, logistics, research, engineering and other goods and services to Chrysler, Ford and General Motors. If a major domestic auto company were to fail, a significant number of supplier companies would also be in jeopardy. This would quickly affect all the companies that produce autos in the United States -- including Toyota, Honda and Nissan -- because many of them buy parts and services from the same group of suppliers.


A major disruption in the auto supply chain would quickly curtail production at auto plants, whether domestic or foreign-owned, throughout the United States. The cost of failure at even a single U.S. automaker would be millions of lost jobs and hundreds of billions of dollars' worth of lost sales and revenue spread across all 50 states.

In addition, more than a million retirees and dependents receive pension and health-care benefits from Chrysler, Ford and GM. If these companies are unable to meet their obligations, the human toll on retirees and their families will be devastating. It's also possible that the failure of these companies could impose severe costs on the federal pension guaranty program and public health-care programs.

In the face of a looming economic catastrophe, it's disappointing to see The Post and some of its opinion writers indulge in old-fashioned Detroit-bashing -- especially since these observers seem to be writing about the domestic auto industry of the 1970s.

It is not the actions of our members that have caused the crisis in today's auto industry; the crisis is being driven by economic factors that have nothing to do with labor costs or factory performance. To the contrary, our contracts have put our employers in a position to compete.

The reality of today's auto industry is that union-made vehicles are winning quality awards and that union-represented factory workers are winning productivity awards. A Nov. 8 Post editorial claimed that unionized auto manufacturers pay "wages and benefits that far exceed those of non-union competitors," but recent labor negotiations with Chrysler, Ford and GM addressed this alleged wage and benefit gap.

Our 2007 labor negotiations with the companies transformed the domestic auto industry; when the agreements we reached have been fully implemented, they will largely or even completely eliminate the labor-cost gap between unionized auto plants and our nonunion competitors. One analyst has estimated that as a result of our contracts, GM will soon enjoy a labor-cost advantage over Toyota.

The various demands for cuts in the wages and benefits of active and retired autoworkers as a condition of federal assistance are curious -- and extremely unbalanced. To my knowledge, no one has proposed cutting the compensation of everyday active or retired bankers, bond traders, and office or building personnel who work at AIG, Bear Stearns or the numerous banks that have received billions in federal aid. Why is it only autoworkers who are singled out for this dubious honor?

Besides being unfair, government-mandated wage and benefit cuts make no economic sense. In the midst of the most severe recession in decades, the last thing we should do is take money out of the pockets of working families, since it is consumer spending that drives two-thirds of all U.S. economic activity.

President-elect Barack Obama has described auto manufacturing as "the backbone of the American economy," and bipartisan efforts are underway in Congress to provide strategic assistance for this critical U.S. industry. It's a good deal for U.S. taxpayers -- because the alternative is lost jobs, closed businesses and shattered communities, which would impose severe human and economic costs on all of us for many years to come.

Ron Gettelfinger is president of the United Auto Workers.

[RamJet502]

If the auto industry is "main street's engine" no wonder our economy is in shambles.

[Clownzilla]

Originally Posted by Gm_Tooler

Link:
http://www.washingtonpost.com/wp-dyn...111303345.html


It is not the actions of our members that have caused the crisis in today's auto industry; the crisis is being driven by economic factors that have nothing to do with labor costs or factory performance. To the contrary, our contracts have put our employers in a position to compete.

What?! Labor costs are still multiple times more than the competition. This has EVERYTHING to do with labor costs.Anyway, the contracts won't matter soon because there will be no contracts and GM can do what they can to become competitive again.

[GAIntrigue]

Yes, the most recent contract negotiations did work to try to level the playing field on labor costs. However, the big 3 have not been competitive for decades. The UAW has been one of the many factors to help ensure the American car manufacturers failed at being competitive.

This article does nothing to impress this Gen-Xer. I live in a world where my retirement is totally based on my 401K and any other savings vehicle(s) I use because a pension plan is somewhat a mythological creature that old people used to get. Any healthcare benefits I get after retirement will be paid out of my pocket because employer-sponsored plans have pretty much been wiped out. My salary (which is still lower than a UAW legacy salary even with a college degree) and any raises are based on my performance and how well I measure up to my peers. I pray to never be a poor performer and find myself being lead out the door.

The younger generations are accused of having an entitlement mentality. Rest assured, I realized quickly after joining the workforce the only thing I'm entitled to is what I can provide myself. I cannot fathom having a union or any other organization providing me any kind of benefits. It's just the cold, cruel, modern world in which we live.

[ericmvest]

Originally Posted by Clownzilla

What?! Labor costs are still multiple times more than the competition. This has EVERYTHING to do with labor costs.Anyway, the contracts won't matter soon because there will be no contracts and GM can do what they can to become competitive again.

Is there recent information on labor costs versus the transplants? The Big Three's latest contracts had a lower wage structure for new hires and transfered retiree health care responsibility to the UAW. This should lower the gap.

[Clownzilla]

Originally Posted by GAIntrigue

Yes, the most recent contract negotiations did work to try to level the playing field on labor costs. However, the big 3 have not been competitive for decades. The UAW has been one of the many factors to help ensure the American car manufacturers failed at being competitive.

This article does nothing to impress this Gen-Xer. I live in a world where my retirement is totally based on my 401K and any other savings vehicle(s) I use because a pension plan is somewhat a mythological creature that old people used to get. Any healthcare benefits I get after retirement will be paid out of my pocket because employer-sponsored plans have pretty much been wiped out. My salary (which is still lower than a UAW legacy salary even with a college degree) and any raises are based on my performance and how well I measure up to my peers. I pray to never be a poor performer and find myself being lead out the door.

The younger generations are accused of having an entitlement mentality. Rest assured, I realized quickly after joining the workforce the only thing I'm entitled to is what I can provide myself. I cannot fathom having a union or any other organization providing me any kind of benefits. It's just the cold, cruel, modern world in which we live.

As a fellow Gen-xer and a person that understands EXACTLY how today's global world operates..........I salute you It's people like you and I that knows what it takes to succeed in today's workplace.

[mike's 01ws6]

Originally Posted by Clownzilla

What?! Labor costs are still multiple times more than the competition. This has EVERYTHING to do with labor costs.Anyway, the contracts won't matter soon because there will be no contracts and GM can do what they can to become competitive again.

You are further behind with your bs than GM is.

[Ed Arcuri]

I applaud Mr. Gettelfinger for supporting this industry and for the recent, difficult moves the UAW has made. It is however, too little, too late.
If GM is going to survive, it will take dramatic changes. Among these: a pledge by senior executives to take $1.00/year in salary until GM is profitable (Iacocca did this - it was a public relations stunt, it was after all Iaccoca- he eventually got his "back pay"), an end to the "jobs bank", backing off on the forced Unionism of card check, and a clear plan for profitability.
GM's stockholders and workers have been abused by poor management, thuggish short sighted Union "leaders," and by government regulations informed by ignorance. Media dopes who continue to bash GM's fuel mileage record are the worst, in my view.
In short, we need more, Mr. Gettelfinger. We need a full throated defense of this industry and those who built it: investors, workers, managers, and customers. We need you to tell us what you, and the people your purportedly serve in your membership, are willing to sacrifice for the sacrifices you ask from the taxpayer.
You won't be alone. We'll keep the heat on management, too. We'll continue to respond to the stupidity writ large in the "news" media. Step up, Sir.
If we don't hang together; we'll hang separately.
Cheers,
Ed

[Clownzilla]

Originally Posted by mike's 01ws6

You are further behind with your bs than GM is.

What BS? The steps are easy:

1.Ch. 11 will void contracts

2. the judge will demand that the UAW workers get paid market comparable wages

3. If the UAW refuses then GM will have the right to close factories and build their vehicles in China, India, Mexico, etc.

What BS is involved?

[fan]

I think the auto industry is fortunate to have this guy as the leader of UAW. He is wise. The recent contracts are decent both for the automakers and union members in these times. The VEBA healthcare plan is very important and it was accepted. Critical wage cuts have been accepted.
It would have been worse if Buzz Hargrove would have negotiated those contracts.
The current government will not dismiss the unions. It would be fun to see GM in chapter 11 and emerge smaller but still unionized.

What would be very important and relatively easy to do is to assure that union leaders be bright, balanced and long-term thinking. Also, the main goals of the compnay should be accepted by the union even if they are aiming high. (E.g. : Reclaim the no. 1 spot in market share and competitive profitability in 5 yrs.)

Having wise union leaders and trying to avoid infighting (union against the management) should be enough to keep it going. Tensionate relations could lead to scenarios where the worker making 30$\hr would want to get even more just to screw the 'fat-cats'.
The most important thing would be to get the unions used to the idea that the company has to be cost competitive, that they won't be screwed.

Also it seems to me the contracts with the union signed till recent years were put together with the mentality of the 50s, 60s when there was no competition and it was not a problem of competitivity but just who gets the profits the fat-cats or the workers.
With the recent crisis, most workers would get accustomed with how important is for a company to remain competitive.

[t-rex]

More 1950s reminiscing...

Let autoworkers keep their wages, but the other perks simply have to go. Let 'em do what the rest of America does... 401k it, baby!

[Clownzilla]

Originally Posted by t-rex

More 1950s reminiscing...

Let autoworkers keep their wages, but the other perks simply have to go. Let 'em do what the rest of America does... 401k it, baby!

I have nothing wrong with giving the UAW workers minor 401k retirement benefits . They are an effective long-term retirement tool. UAW workers also need to take some of their paycheck and invest it in diversified investment vehicles themselves (which I highly doubt many do). Retirement should be the worker's responsibility and not their employer's responsibility. Just out of curiosity, any of you UAW workers want to make a case on why you should get a pension plan as opposed to a 401K plan?

[member12]

Originally Posted by t-rex

More 1950s reminiscing...

Let autoworkers keep their wages, but the other perks simply have to go. Let 'em do what the rest of America does... 401k it, baby!

Let the unions go and let the market decide their wages. When all is said and done, $69 dollars is a far cry from $32 per hour including benefits. Defined benefits don't exist anymore for normal people. No one is arguing that UAW members don't deserve fair pay.

If they are really worth $100/hr or even $150/hr, then GM will be forced to pay them to get the best employees. If not, then they should move to a Ford, Toyota, Honda, or other factory.

The market decides my salary and yours...and obviously they pay us enough. If they didn't we wouldn't show up.

[johnnyl321]

Originally Posted by ericmvest

Is there recent information on labor costs versus the transplants? The Big Three's latest contracts had a lower wage structure for new hires and transfered retiree health care responsibility to the UAW. This should lower the gap.

it WILL help...problem is time is NOT on their side. VEBA hasn't kicked in yet and as for new hires, GM's been closing plants and laying off people, who will collect money from unemployment and the GM contract pays them the difference. being paid for NOT working is one of the many reasons why GM is hurting for cash.

[Clownzilla]

Originally Posted by johnnyl321

it WILL help...problem is time is NOT on their side. VEBA hasn't kicked in yet and as for new hires, GM's been closing plants and laying off people, who will collect money from unemployment and the GM contract pays them the difference. being paid for NOT working is one of the many reasons why GM is hurting for cash.

I want to hear one argument on why the job bank is a good idea. Any UAW worker want to defend that?