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March 2009 Archives

March 2, 2009

Teachers' Union to DC: Your Child Left Behind

Death must be near, as I find myself agreeing with WaPo editorials. Can the rapture be far away? Today is a rare one in that the Post actually nailed it on two separate editorials. I posted on one (on H1B) here, but the one criticizing the Dems' efforts to end the D.C. Opportunity Scholarship Program hit the mark as well.

Under the sub-head, "Ending D.C. school vouchers would dash the best hopes of hundreds of children," the Post challenges Dems to explain to Deborah Parker, mother of two kids in the program who attend the otherwise-exclusive Sidwell Friends school (home to the President's children) why she would have to move her kids back to the dreadful DC Public Schools. The answer from the Democrats, sadly, is quite plain: "Because we are beholden to the teachers' unions." Judging from a recent report, the program has been a shining success.

Were that there was a better word for this, but there is not. It is a disgrace. Every Democrat who voted to deprive these kids of the opportunity to attend private schools, to lift themselves out of poverty, to give them some hope, should hang their heads in shame. Says the Post in closing, "[S]omeone needs to tell Ms. Parker why a bunch of elected officials who can send their children to any school they choose are taking that option from her." Until the decision is reversed, that cohort sadly includes the President of the United States. Click here to contact your Representative, click here to contact your Senators, and click here to send a note to the White House.

Finally, click here to see a great two-minute video featuring some of the kids who are now benefiting from this scholarship, courtesy of VoicesOfSchoolChoices.org.

March 8, 2009

Today's WaPo: Jim Hoagland Makes History

You collectors out there run -- don't walk -- to buy a hard copy of today's Washington Post. Forget the one from Obama's Inauguration, or the day McKinley was shot, or the day the Hindenburg crashed. They are worthless by comparison. For today, WaPo columnist Jim Hoagland has a genuine piece of history: The first -- and maybe only -- paean to Joe Biden. It is beyond hilarious in its obsequiousness. Were John Stewart not such a partisan hack himself, he could have penned it, with its almost tongue-in-cheek soaring, laudatory rhetoric. But sadly, this is not satire. It's the real thing: Adoration of that lovable ol' marginalized gaffe machine - Joe Biden.

In the most recent edition of the Weekly Standard, Fred Barnes, citing Obama's laughable reference to the undistinguished Veep in his speech to Congress, "Nobody messes with Joe," notes correctly, "In truth, nobody pays any attention to Joe, as Obama surely knows." To that point, it appears even the left-leaning mainstream media figured that out pretty early on, some time between Joe's second and third failed bids for the Presidency. Even the Obama Administration's house organ, the NY Times, says today about Joe:

"Joe Biden now has the title [of Vice President], the residence and the security detail, but the position has been dummied down. Mostly, President Obama treats him like a latter-day Paul Shaffer, humoring him briefly, then shunting him off-stage before he goes on too long."

Contrary to Hoagland's fawning premise that "Obama's Mr. Fix-It" (that would be Joe) is headed to Brussels to broker the beginning of world peace, as anyone who's been reading the papers (including the NY Times) since Inauguration Day knows, Obama is likely sending Biden to Brussels to get him the hell out of town. A quick scan of YouTube will tell you why. Maybe Hoagland's got a non-digital TV that doesn't get YouTube.

So do get a copy and frame it. Presidents will come and go, dirigibles will launch and crash, but outside of maybe The Onion, you'll never see another piece like this.

March 10, 2009

For The Politico, No Fact Check on Card Check

Here's the story that was spoon-fed by the SEIU to The Politico yesterday, reporting that the SEIU was sending 300 people to protest at the US Chamber because of the Chamber's apparent defense of democracy through their opposition to card check legislation.

Only problem is, somebody forgot to check and see how many people the SEIU actually turned out. First-hand observers (remember them?) said the protesters numbered about 40. That's a far cry from 300 -- less than 15%, by our math. How easy it must be to just call reporters and get them to do your bidding for you. All The Politico readers knew -- a fiction repeated by at least two other heretofore well-respected publications -- was that there really were 300 people there. Not even close.

At the end of the day, the real story here is not the laziness exhibited by the Fourth Estate (there's gambling in my casino??) but the pathetic showing of the once-mighty SEIU.

March 11, 2009

Big Shockeroo: EFCA Sponsors Get Lots of Union $$

Here's another -- more accurate -- story from The Politico today, noting that the two main sponsors of the card check bill -- Rep. George Miller (D-CA) and Sen. Tom Harkin (D-IA) -- have received a combined $3.5 million in political contributions from unions. What a coincidence. Last time around, the anti-democracy forces vacuumed up some $90 million in all from unions. No wonder they want to take the secret ballot away from folks - more dough for them!

Here's a link to the bill, officially known as H.R. 1409, introduced yesterday. There are 223 co-sponsors, down from 233 in 2000. The Senate bill has 40 co-sponsors, down from 46 in 2007. We are making progress. Looks like a lot of centrist Dems are getting nervous about supporting a bill that takes away people's right to vote. Will wonders never cease? Maybe PAC money has its limits in terms of pushing rational people past the bounds of sound judgment.

Here's a good time-waster cum civics lesson while you're idly listening in on your next conference call: Peruse the list of co-sponsors found here and check it against this handy-dandy list from the Center for Responsive Politics, to see how much each co-sponsor is hauling in from unions. Just click on the union shill Member of Congress you want to see, then click on the "PAC" tag and let the fun begin.

You can click here to weigh in with your Member of Congress and Senators. They were elected -- why shouldn't workers have the same right to have an election to decide whether or not to be represented by a union?

March 12, 2009

On NPR: Card Check and Obfuscation

For you true suckers for punishment out there, here's a one hour show that aired on NPR today on the topic of card check. It features on the union side both Steve Greenhouse of the New York Times (who's ostensibly neutral but everybody knows better, including the listeners) and Bill Samuel of the AFL-CIO. Business is more than ably represented by Steven Law of the US Chamber, who spent 8 years at the Department of Labor in a number of very senior slots and actually knows what he's talking about. Tom Ashbrook, the moderator, sounds pretty fair-minded and presses both sides equally.

Union supporter Greenhouse in describing the current state of play says, "Right now, companies and managers can insist on a prolonged campaign and a secret ballot election." He adds, ”Union organizers are not permitted to set foot on company property…. management totally dominates the conversation" and adds that the company makes threats to move the company if they are unionized. Ashbrook asks him if that maybe isn't a threat but might actually be true. Greenhouse is forced to concede the point. Samuel, a great advocate, piles on, alleging that union organizers are routinely fired.

In fact, companies cannot "insist on a prolonged campaign" at all. Under the law (anybody remember the law?) if the union gets 30% of the employees to sign cards, they go to the NLRB and file for an election. If they get 50%+1, they can ask the employer to recognize, which the employer can do, or can opt for an election, knowing full well that in every case some number of cards were coerced.

As for not setting foot on company property, Greenhouse is right as far as non-employees are concerned. Union supporters among the employees are free to speak their minds. However -- a fact completely lost in this entire debate -- once the union gets 30% of the employees to sign cards and the NLRB authorizes an election, the company is required to give the union a list (called an "Excelsior" list for the case that announced the principle) of all employees in the unit and their home addresses -- whether or not they signed cards. That's a salient fact, no?

As for the unions' continued empty allegations of mass firings of union organizers, there happens to be a Federal agency -- that same NLRB -- that exists for the purpose of sorting out such things. If the unions are right that the organizers were fired for being organizers -- and not for any other reason -- then that's against the law and the NLRB will require them to be re-hired with back pay. Not an employer in the country finds the NLRB to be an employer-friendly agency.

What's annoying about all of this is that the unions know the process better than anyone. Yet they continue to obfuscate and to use the public's -- and Congress' -- general ignorance about the issue to their advantage.

Best thing we can all do is get the facts out. Pass it on.

March 15, 2009

Card Check Raises Issues of Democracy

Interesting article on card check in today's WaPo by Alec MacGillis, who's doing his level best to cover a very unfamiliar issue, ties the issue of card check to "Broader Capitalism Issues," per the headline. But in fact, the card check bill has little to do with the broader issues of capitalism and everything to do with issues of simple democracy. At issue here is how people will decide whether or not they want to be represented by a union. Would this Congress want municipal or federal elections determined on the basis of card check, the first candidate to gain the signatures of 50%+1 of eligible voters? C'mon, Harry Reid, how 'bout it?

Proponents of the bill love to cast it in terms of animus, but in truth the only animus here is toward the forces of democracy, the fundamental issue on which this country was founded, that our citizens would always have a voice, a vote.

As the union skates like to sing, "Which side are you on?"

Corporate Philanthropy vs. Union Heavy-Handedness

Check out this post on corporate philanthropy. However, here's another factor to consider: Think of all the money that corporate America donates, and think of the recipients of that largess. Think of groups on the left, including universities and institutions like NPR and PBS, who happily solicit and rely on corporate money to keep them in business. Yet they use this money to regularly rail against corporations.

Can you imagine organized labor giving one dime to a group with which it disagreed? They are notoriously heavy handed, enforcing dogmatic purity on any group that receives their lucre. Kinda like the Mafia. And while you're at it, imagine the outcry if corporate America decided not to fund groups that used their money to undermine their good work and reputation. You can hear the howls of censorship now.

Just another case of the great double-standard. Let the unions weigh in and regale us with all the groups they fund that criticize them -- or how 'bout one that even disagrees with them slightly? Don't hold your breath.

Continue reading "Corporate Philanthropy vs. Union Heavy-Handedness" »

March 16, 2009

Tech Community in 'Uproar' over Card Check

Add one more voice to the growing chorus of job creators out there who support democracy and oppose the card check bill.

A story in today's WaPo - in the Business section by tech writer Kim Hart - notes that the powerhouse Northern Virginia Technology Council, ably run by Washington hand Bobbie Kilberg, has come out foursquare against the bill. "A lot of the work we do is very team-oriented," says one tech executive. "If all of a sudden you have a layer of bureaucracy that has a different set of rules for hiring, firing and rewarding employees, that's going to stifle creativity and our ability to innovate."

The story notes that tech workers' salaries are among the most competitive in the country, with the average information-technology pro making $78,035 last year. This isn't about wages, as the anti-democracy forces would have you believe, it's about flexibility and the ability of workers and management to work together to find the most productive way to accomplish the work. It is after all the 21st Century. As Consumer Electronics Association Executive Director Gary Shapiro says, "Small companies need to be more flexible," he said. "If they want to change an assembly line, do research, give Christmas week off, they'll have to go through a union to do it."

Does anyone really want to have to deal with this guy....?

AIG: Look Who Got Paid Before the Bonuses Were Handed Out

Reading about all this AIG stuff is enough to give you the shpilkes. One has to wonder, who on earth is protecting these folks? Who are their political allies?

With the help of an internet search engine called Google (apparently not accessible to the mainstream media) a search for "AIG political contributions" will lead an inquiring mind to Yahoo! Answers with a link to the non-partisan OpenSecrets.org site where you will find this chart of AIG contributions. It shows that over the last three election cycles, AIG has given increasingly more to the Dems. From a 55%-45% split in favor of the Dems in 2004, the gap grew to a 68%-32% advantage in this past (2008) cycle.

Continued, dogged investigation (i.e., two more clicks) leads you to this article, entitled, "Before the Fall, AIG Payouts Went to Washington," wherein you will find that Sen. Chris Dodd (D-CT) and Max Baucus (D-MT) are "among the top recipients of AIG contributions." It goes on to say that AIG his the fourth largest contributor to banking Committee Chair Dodd with a whopping $280,000. In the last cycle, the top 5 recipients of AIG money were (in order) Senators Dodd (D-CT), Obama (D-IL), McCain (R-AZ), Clinton (D-NY) and Baucus (D-MT).

Funny that in this maelstrom of finger-pointing about the paying of the bonuses by AIG, you don't see much reporting on who their patrons have been up until now. Seems like it might make a good story, no?

Maybe it just did.

[Update: Here's today's WaPo story on AIG and here's a link to Chris Dodd's top donors from this past cycle.]

March 18, 2009

Card Check Update: It's the Democracy, Stupid!

Thanks to Jim Gray for supplying lots of fodder these days. Here are two good ones:

-- Bad news for labor: Only 9% of non-union workers want to join a union. Just think about how many current union members would like to get out. Wonder if the union folks would be willing to let 'em leave? Doubt it.

-- As we've been saying, card check is "Just Plain Un-Democratic." Real Clear Politics agrees.

-- The Wall Street Journal reports today that the battle is centered on 3 states; Pennsylvania, Arkansas and Colorado. If you're in one of those states, make your voice heard.

Also, keep checking Carter Wood over on ShopFloor.org, for reliably great stuff every day on this topic.

Watch Chris Dodd Tap Dance

This is awkward. At around the 2:40 mark you'll see that "uh-oh" look on Dodd's face. After saying he had nothing to do with this loophole, turns out he did. Kinda. Maybe. Sorta.

Hemmina, hemmina, hemmina....

Maybe we need this guy. Here -- you be the judge.

And finally, note that in the end he says this will all be sorted out by $enator Baucu$ (D-MT), who received $90,000 from AIG, and $en. Chuck $chumer (D-NY) who hauled in $111,875. That oughta make you feel a whole lot better.

March 19, 2009

Chapter 11 for GM - Why Not?

It's been very interesting to watch this whole GM dance play out. It appeared obvious to everyone pretty early on that Chapter 11 was an option - and maybe the preferred option - for GM. But CEO Rick Wagoner has stood firm against it -- until yesterday, that is. As the Wall Street Journalreported yesterday, Wagoner "said a bankruptcy filing 'puts things out of the control of the board and management.' But Mr. Wagoner also said bankruptcy 'could work but it might not work,'" whatever the hell that means. But it was seen as a sign that he might be warming to the idea. Something about the sight of the gallows, apparently. Wagoner often cites the effect on shareholders, customers and suppliers in describing why he doesn't want to go down this path, thus omitting the real reason why he doesn't want to declare Chapter 11.

Since the object of Chapter 11 is to allow a company to reorganize -- and ultimately to emerge from Chapter 11 -- among other powers, it allows the court to abrogate all the labor agreements and start from scratch. So the UAW -- joined by their amen chorus in the Obama Administration -- have been stiffening Wagoner's spine. Since his allies are few and far between, he has thus far been compliant in parroting the UAW party line that bankruptcy would be bad for GM.

In fact, it may be the only thing that saves them.

March 21, 2009

On Card Check, A Compromise?

Props to Alec MacGillis of the WaPo, who's doing a pretty good job of covering the card check story. Here's an update from about an hour ago on a story that ran this a.m., that Costco, Starbucks and Whole Foods are working on a compromise. They're being helped along by Lanny Davis, who was Bill Clinton's main apologist and defender during the Monica Lewinsky stuff, so that doesn't really give anyone warm fuzzies. It says they have approached "about 20 Senate offices." We can guess who they are. You probably want to weigh in with them again.

Shortly before his Inauguration, Obama signaled that he was looking fora compromise. They say that this compromise keeps secret ballot elections and doesn't allow arbitration but will allow the unions a chance to address the employees on company property before an election and will set a definite time period for the election. Am guessing this will trigger labor's gag reflex. It's the democracy they hate.

In the earlier version of MacGillis' story that ran in the morning paper, there was this:

"It is the pro-management tilt in the current laws, unions say, that explains why only 7.5 percent of private-sector workers belong to unions, down from 36 percent in the 1950's...."

This is indeed the unions' complaint. But wait a second: Isn't this the same statute under which unions saw fantastic growth for the first few decades? If the statute hasn't changed (and it hasn't), then when did the "pro-management tilt" materialize in "current law"? Never let the facts get in the way of a good -- and whiny -- story. Maybe they're selling a product that people no longer want to buy. No wonder they need a thumb on democracy's scale.

It's possible that labor -- the experts on taking the long view -- will take the compromise just to get a foot in the door, put the extra goodies in their pockets for free (why not?), count ten and then come back to say it's not working. But you can be sure they will first force and up or down vote, as a "love test," to see who gets their cash next time.

Thoughts? Reaction?

[Update] Here's a link to the press release put out by these three companies, who have organized themselves into something called, the "Committee for a Level Playing Field for Union Elections." It lays out their 6 principles. Check out #2 -- for labor this is a show-stopper. They want to make it easy for folks to get in, not out.

This seems a little premature....

From Mike Allen's Playbook on Politico:

"BREAKING: Unions rejoice as some businesses begin compromising on the legislation they call “card check.” An authoritative business source tells us: “99.9% won’t.” Still, a top labor official e-mails us: “I’m dancing a jig with them caving.”

This seems a little premature, no? But it shows why talking compromise at this point is dangerous. Let this thing pass the House and fail to get 60 votes in the Senate. Then let's address the real issues facing the country.

In the meantime, as Springsteen sings, "No retreat, no surrender."

March 22, 2009

A Pro-Management Tilt?

Further to yesterday's post on this part of the WaPo story on card check:

"It is the pro-management tilt in the current laws, unions say, that explains why only 7.5 percent of private-sector workers belong to unions, down from 36 percent in the 1950's...."

As noted in an earlier post, there is not a single employer in the country who thinks the NLRB has a pro-management bent, who breathes a sigh of relief and says, "Oh, thank God, the NLRB is involved!"

And before the unions can cry, "It's the (5-Member) Board!," let's remember one very inconvenient truth: For the 8 years of a Board hand-picked by labor during the Clinton years, union membership numbers continued to decline. Every year.

So maybe it is the product after all.

Dodd is Toast

It's always interesting to watch these things play out, when you see a politician who is toast, when the whole world knows they're toast but they haven't figured it out yet on their own.

Here's a story on Sen. Chris Dodd (D-CT) from today's WaPo and a similar one from the NY Times. Here's an editorial on Dodd from the hometown paper, the Hartford Courant, and a stinging op-ed from the Courant entitled, "There's No Bonus for Lies, Senator Dodd," both from today. Ouch. Taken together, this is called a meme, a phrase or a notion that starts to sweep the web. The "Dodd is Toast" meme has officially begun.

If you're from Connecticut - and even if you're not -- you should drop him a note, thank him for his years of service and tell him what everyone else has figured out, i.e., that he's toast.

'A solution to the coming card check battle'

Here's a story by that name that ran in Fortune back in January. It profiled an effort by strange bedfellows Rich Bensinger, former organizing director of the AFL-CIO and Dick Schubert, former Deputy Secretary of Labor in Republican Administrations.

Bensinger and Schubert formed a labor/management partnership called the Institute for Employee Choice a few years back (a name selected long before EFCA's birth), in their terms, "to try to insert ethics into the arena of union organizing campaigns." Their principles are based on focus groups and interviews they conducted among workers who had recently gone through NLRB elections, asking about union and employer conduct as well as about the effectiveness of the NLRB election process. These principles were also the basis for SEIU's votes last year with Catholic Health Care Partners in Ohio. In the end, the union won 2 and the employer won 3 of the bargaining units involved. Schubert and Bensinger report that the parties felt that was a pretty fair representation of the employees' wishes.

Their "principles for fair elections" include such things as equal access for unions, equal posting rights, and expedited arbitration for terminations. But at the end of the day, their effort didn't get much traction since at core, the AFL-CIO ain't all that interested in elections, as it turns out. Wow -- who saw that coming...?

The truth is, johnny-come-latelies like Lanny Davis - and the trinity of Costco, Starbucks and Whole Foods - would do well to work with established, credible folks like Bensinger and Schubert. In fact, interested parties can work with them any time they want, to establish a framework for discrete union activity without any government involvement. What a concept.

March 27, 2009

On Card Check, DiFi 'On the Fence'?

That's what Glenn Thrush is happily reporting on his blog over at The Politico, i.e., that Sen. Dianne Feinstein (D-CA) a co-sponsor of the anti-democracy card check bill last time around, has maybe come to her senses and has decided to pass on co-sponsorship this time around - at least for the moment. If you're a Californian, you should thank her and urge her to stay on that fence - or jump to the side of democracy.

In light of Sen. Specter's (R-PA) good news last week, maybe there's a trend here.

Harkin Seeking a Compromise on Card Check?

That's the word according to Roll Call as reported by Brian Faughnan in this post on RedState.com. Not sure that's a comforting notion. Labor will take any improvements it can get, then count ten, declare them ineffective, wait for the economy to turn around and come back for more.

What's wrong with the status quo?

March 28, 2009

Dog DNA: Who's Your Daddy?

Allow me to go off topic a bit here, a bit of a tangent.

I was part of a panel on social media at the Greater Washington Board of Trade few weeks back. In the audience was Theresa Brady of Canine Heritage, the people who make the dog DNA test kits. We met and I told her we just adopted a new puppy - rescued from a "kill shelter" in Georgia by two angels named Kevin and Uma here in Northern Virginia. She offered me a free test if i would blog about it. So there's your full disclosure and some context.

Read more below....

Continue reading "Dog DNA: Who's Your Daddy?" »

March 29, 2009

Card Check: We've Seen This Movie Before

Kurt Vonnegut in a lecture once sketched out the plot line of the majority of the world's stories on a graph: The line goes up, great good fortune. Then the line goes down - "Oh, hell," in Vonnegut's words, and then the line goes back up again, victory. He stands back, looks pensively at the blackboard on which he has sketched this simple "up-down-up" graph, points to it and shakes his head. "People have made a million dollars off of that story," he says.

And so it is in Washington as well - a well-worn story line: Over-reaching bill gets introduced by the left, labor gets its bought-and-paid-for amen chorus in the Congress to sign on. Cooler heads begin to prevail, prospects for the bill dim. Then the unions scream "Compromise!" to get half of a lousy idea instead of the whole thing. Business is cowed into accepting it at the risk of -- gulp -- "looking unreasonable." Roll the credits.

The WaPo notes today that the weakening of support for the anti-democracy card check bill has of course led folks to talk about compromises.

In the story, two of labor's canards are repeated:

Continue reading "Card Check: We've Seen This Movie Before" »

'Automaker Aid Hinges on Restructuring'

That's the headline on this Wall Street Journal story. In fact, the only hope GM has for flying out of this current mess is to declare Chapter 11. It allows them to reorganize and most importantly;y will allow them to abrogate their costly UAW agreements. For too long they promised what they simply cannot afford to deliver in the hopes of buying labor peace. What they bought was a rock around their necks. Time to start with a clean slate, and Chapter 11 is the only way to do it.

That's why the UAW and the Obama Administration oppose it.

Joe Biden: From Punchline to Statesman (Sort of) in the Hands of the New York Times

Here's a must-read for any student of creative writing or obit writer tasked with turning a late-night comedian's punch line into a statesman. The New York Times has done it today in their front page profile of the hapless Joe Biden. Writer Mark Leibovich, either checking a box for an overzealous editor or currying favor (or repaying a debt) to the Biden team writes what can only be called a laughable panegyric to the Veep who even partisan hack John Stewart has described as "your crazy uncle." Those in the know, Leibovich, avers, are noticing "the influence Biden appears to be wielding," influence which has gone unnoticed to everyone else until now. But a close reading of the story reveals a slightly more, uh, balanced view. For each clause that giveth there's a clause that taketh away.

Read on....

Continue reading "Joe Biden: From Punchline to Statesman (Sort of) in the Hands of the New York Times" »

Rick Wagoner to Resign?

If it's true that Obama insisted on the GM CEO Rick Wagoner's head on a platter as a quid for the quo of continued government largess, one would have to assume that the same will apply to UAW chief Ron Gettlefinger, one of the most ineffective and incompetent union chiefs in history?

Yeah, don't hold your breath.....

March 30, 2009

Does This Look Like Sacrifice to You?

The headline in this UPI piece - heralded over on the WSJ site, too -- says, "Obama: Sacrifice needed for auto industry." It is by now old news that part of that sacrifice means GM CEO Rick Wagoner is resigning. But shouldn't Ron Gettlefinger, President of the UAW and partner in crime, also resign? He not only bears some of the blame for GM but for Chrysler and Ford, too, putting him in a unique position of culpability.

Gettlefinger, for his part, has been saying for the past 6 months that they've had enough givebacks. It's gotten so bad, though, that he had to agree to remove the clause in the contract that allowed them to get paid not to work. Wow, talk about sacrifice!

So 6 months ago we moseyed on over to The Google and typed in "UAW." On their site was a link to summaries of their most recent contracts - a link that's mysteriously gone now. Luckily, we saved it. So here it is, a link to what they said when they inked the most recent agreement with GM back in 2007. Mind you, this was as the company was by everyone's reckoning speeding headlong into a trough. The UAW release says in part:

The tentative agreement, reached at 3:05 a.m. Sept. 26, delivers solid economic gains for active and retired members, despite repeated attempts by GM to impose harsh takeaways

The agreement will deliver more than $13,000 in economic gains for a typical UAW member, including a $3,000 signing bonus, two 3 percent lump sums and a 4 percent lump sum.

Active workers will see their comprehensive health care coverage continue, with dental, hearing and other benefits improved. Retired workers will have their health benefits secured by a Voluntary Employee Beneficiary Association (VEBA), prefunded by GM with $29.9 billion in cash and other assets. The fund can only be used to pay retiree health benefits, and will remain solvent for decades regardless of the financial condition of GM.

The proposed contract will also deliver benefits to current and future retirees, with four lump-sum payments for current retirees, and a raise in basic benefit rates, the 30-and-out supplement, temporary and interim benefits for future retirees.

Does this look like sacrifice to you?

A "senior Administration official" is quoted in this WaPo article today as saying that Wagoner's resignation was required because the company needs a "clean sheet." If the Administration is serious about that, then Wagoner's ouster leaves the job half done, or less. If they really want a "clean sheet" - and want to show the country that they're not completely beholden to the UAW - they should demand Gettlefinger's resignation as well. The UAW helped get the companies into this mess, they should bear some of the pain of getting them out.

For the UAW, Obama Spares the Rod

Here's this from the New York Times story today:

"Although some observers of the auto industry have attributed Detroit’s troubles in part to generous wages and health benefits for assembly line workers, the president made no mention of those factors. 'The pain being felt in places that rely on our auto industry is not the fault of our workers, who labor tirelessly and desperately want to see their companies succeed,' he said."

First and foremost, the President makes the fundamental mistake of equating "workers" with "unions." The gap between them was established long ago, about the time unions started caring more about themselves and their own self-preservation than the workers they were compelled by law to represent.

Second, look at this chart, which sums up the gap in compensation between the Detroit 3 and the so-called "transplants." It was taken from Chrysler's submission to Congress late last year. Note the compensation rate of over $70/hour, with a wage rate of $26/hour. The Toyotas and Hondas of the world (Honda alone directly employs some 27,000 US workers) have similar wage rates but a compensation rate of about $45/hour - $25 less than their Detroit 3 competitors. The gap is something the UAW loves to brag about but which is dragging under the Detroit 3.

Yet late last year, the UAW made clear that concessions were "out of the question.... 'Workers and retirees have already made significant sacrifices,' said UAW lobbyist Alan Reuther at the time, 'We feel we've already stepped up.'"

If so, that's not clear to anyone else, certainly not the overwhelming majority of taxpayers who can only dream about the lifetime benefits that the UAW enjoys. The truth is, the companies couldn't afford those promises when they made them and the UAW knew it.

According to the Times story, Obama said there had been, "A failure of leadership" in the industry. He is right, but he should acknowledge what everyone else has figured out, i.e., that this failure sat on both sides of the bargaining table.

The UAW should take its medicine. For starters, Gettlefinger must go.

March 31, 2009

From the President, A Foreign Concept

In announcing his plan for GM and Chrysler on Monday, President Obama -- talking about the auto industry -- said, “Year after year, decade after decade, we’ve seen problems papered over and tough choices kicked down the road, even as foreign competitors outpaced us.”

It seemed almost quaint to hear the word, "foreign" in describing the competition of the Detroit 3. Honda and Toyota, for example, came to our shores decades ago and in the eyes of most consumers -- certainly the post-baby boomers - are viewed as much as an American employer as GM and Chrysler -- the latter for a spell owned by a German company. Together, the so-called "transplants" employ over 90,00 Americans directly, with an annual payroll of over $6 billion and indirect employment well over a half a million.

This fact sheet has some very impressive statistics about that part of the industry - the part that isn't looking for a bailout, the part that hasn't consistently given the store away to the UAW, making promises they knew they couldn't afford.

The President ought not feed the nation's xenophobia by talking about "foreign" competitors. Competitors are competitors, regardless of where their global corporate headquarters happen to be situated. As the President mingles with his colleagues at the G20 meeting in London this week, he'd be well-advised to put aside the language of a different era, before the economy went global, and embrace foreign investment -- in both directions -- as way to grow the global economy in these difficult times.

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About March 2009

This page contains all entries posted to Pat Cleary.com in March 2009. They are listed from oldest to newest.

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