UAW Killing Big 3?

[DGthe3]

Originally Posted by PJ

Then your alternative is socialism. Because the news media has yet to report how the influx of capital to GM is going to turn around the company to profitability for the 21st century.
Let them fall. Break the UAW, reorganize, pay market wages and benifits and build a profitable company.
Big bloated bad companies should fail, it will get tough, but the free market will adjust.

The government should not be bailing out businesses, should not be protecting business. They should get the hell out of business's way, quit taxing them like cash cow, and watch the prospect of risk and profitability take American companies past all foreign competitors.

Socialism is state ownership of business. This is a loan from the govenrment. Not even close. The cash will let them pay the bills while the market is down. GM has been restructuring, making better agreements, and designing best in class products. Government not protecting business is part of what got the big three into this mess. The Germans protect their automakers, the Japanese protect theirs, the Koreans protect theirs. In North America, we opened doors and let everybody flood the market.

Originally Posted by garagelogic

If anybody really believed GM or any of the big 3 had the ability to turn things from just receiving a loan, then the private sector would be offering to give them the money they need. The fact that they are not just proves this is not a good deal for the taxpayers.

Yes, I do realize how many jobs could be lost. So be it. I imagine many of those people will find other jobs. Will they be able to command the same wage or standard of living, probably not, but then again, a lot of union workers have been enjoying the money they are making well above what non-union workers make. Maybe that would open some eyes in this country.

Predictions say that GM, and the others, will return to profitability in 2010 when the new union agreement comes into effect. As for the private sector giving them a loan, its kinda hard for anyone to get a loan. Let alone a multi billion dollar loan for a business in debt where their market is down 30%. Lastly,where would 3 million or so workers going to find a job during a recession?

[garagelogic]

Originally Posted by MajorTom

...I'm a firm believer that American workers need to be guaranteed jobs. We live in a wealthy society, but because of that there are incredible extremes of class. From the ridiculously wealthy to the desperately poor. They say the American dream is that any man can be whatever he wants. But that's not always true.

Unions allow this to some extent. A person can get a union job and in a few years begin making their maximum pay rate. Then they can work for his 30 years or so and then retire with a pension and live decently. So it's very reasonable to support a union.

See, that's exactly the attitude that has put our country where it is, at least from a labor perspective. I agree, the people that run the companies have as much, or more, to blame as labor, but it took both to get us where we are today. Why should anyone in America be guaranteed anything that is not spelled out in our Constitution? You act like every worker in America has a right to be employeed, a right to periodic wage increases, a right to have someone else provide for their retirement income. Sorry, but those things are your responsibility, not mine, a company's or the federal govenments.

Originally Posted by DGthe3

Socialism is state ownership of business. This is a loan from the govenrment. Not even close. The cash will let them pay the bills while the market is down. GM has been restructuring, making better agreements, and designing best in class products. Government not protecting business is part of what got the big three into this mess. The Germans protect their automakers, the Japanese protect theirs, the Koreans protect theirs. In North America, we opened doors and let everybody flood the market.
Predictions say that GM, and the others, will return to profitability in 2010 when the new union agreement comes into effect. As for the private sector giving them a loan, its kinda hard for anyone to get a loan. Let alone a multi billion dollar loan for a business in debt where their market is down 30%. Lastly,where would 3 million or so workers going to find a job during a recession?

Blah, blah,blah. The reason the big 3 are failing is simple. Fewer and fewer people are buying their product but they are unable/unwilling to restructure their business to compensate for the market changes. Give me 3 qualified things that, if given a "loan" by the taxpayers, GM is going to rebound in the future. Chances are you can't, which is why the private sector is not willing to loan the money to them. If you really think that the capital is not available, then you have no idea how little $25 billion dollars is in the world of big business. There are thousands of places that are ready and willign to make a loan of that magnitude even in today's economy, provided you are not a risk to default. The Big 3 are.

[Mr. Wyndham]

Originally Posted by garagelogic

Blah, blah,blah. The reason the big 3 are failing is simple. Fewer and fewer people are buying their product but they are unable/unwilling to restructure their business to compensate for the market changes. Give me 3 qualified things that, if given a "loan" by the taxpayers, GM is going to rebound in the future. Chances are you can't, which is why the private sector is not willing to loan the money to them. If you really think that the capital is not available, then you have no idea how little $25 billion dollars is in the world of big business. There are thousands of places that are ready and willign to make a loan of that magnitude even in today's economy, provided you are not a risk to default. The Big 3 are.

"blahblahblah"? What are we in the 4th grade?

"but they are unable/unwilling to restructure their business to compensate for the market changes"

This is absolutely, unbelieveably WRONG.

Just 3 things?? How about 6 off the top of my head. Keep in mind there are MANY more...that we don't know of due do us...*not* being in the business...

1: They've renegotiated contracts with the UAW, essentially replacing a lot of the older workers with lower-paid (half-paid, actually $15/hr) new guys.

2: They've shifted the massive healthcare burden onto the union, as well. In the form of this VEBA plan, GM has no obligation to pay out anymore healthcare costs for all those retired workers come 2010.

3: They've improved their product portfolio drastically. Nearly every new vehicle they've come out with in the past 3-4 years has been garnered with some sort of award, or recognition in quality. Their theory, as per Bob Lutz and others, is to build a great product and the money will come to them, as opposed to the old way of thinking: cut corners to save costs.

4: According to the guys in charge; 18 out of 19 new releases (or something like that) will be cars or crossovers...is that not shifted towards the market enough?

5: They've streamlined management, focusing the 8 brands into 4 heirarchys of management. Saving costs, and improving efficiency.

6: They've cut jobs (both white and blue collar), and closed slow plants to tighten up efficiency in order to save some dough.

Absolutely, I'm sure more can be done; and no -- they're not perfect. But that can be said of any business...If the housing market hadn't collapsed, gas prices hadn't shot through the roof for no reason, and the economy hadn't begun this implosion; in other words, if they hadn't been hit by this "perfect storm" as some like to call it, I believe there was a good chance GM was going to return to profitability if not this, then next year. Their vehicles are among the best on the market, and their advertising started to show it. But nobody is buying them right now...so none of it matters. The loans most likely meant to hold them over untill 2010 and a much improved market/economy...they've done nearly everything else already.

[garagelogic]

Originally Posted by Dragoneye

"blahblahblah"? What are we in the 4th grade?

"but they are unable/unwilling to restructure their business to compensate for the market changes"

This is absolutely, unbelieveably WRONG.

Just 3 things?? How about 6 off the top of my head. Keep in mind there are MANY more...that we don't know of due do us...*not* being in the business...

1: They've renegotiated contracts with the UAW, essentially replacing a lot of the older workers with lower-paid (half-paid, actually $15/hr) new guys.

2: They've shifted the massive healthcare burden onto the union, as well. In the form of this VEBA plan, GM has no obligation to pay out anymore healthcare costs for all those retired workers come 2010.

3: They've improved their product portfolio drastically. Nearly every new vehicle they've come out with in the past 3-4 years has been garnered with some sort of award, or recognition in quality. Their theory, as per Bob Lutz and others, is to build a great product and the money will come to them, as opposed to the old way of thinking: cut corners to save costs.

4: According to the guys in charge; 18 out of 19 new releases (or something like that) will be cars or crossovers...is that not shifted towards the market enough?

5: They've streamlined management, focusing the 8 brands into 4 heirarchys of management. Saving costs, and improving efficiency.

6: They've cut jobs (both white and blue collar), and closed slow plants to tighten up efficiency in order to save some dough.

Absolutely, I'm sure more can be done; and no -- they're not perfect. But that can be said of any business...If the housing market hadn't collapsed, gas prices hadn't shot through the roof for no reason, and the economy hadn't begun this implosion; in other words, if they hadn't been hit by this "perfect storm" as some like to call it, I believe there was a good chance GM was going to return to profitability if not this, then next year. Their vehicles are among the best on the market, and their advertising started to show it. But nobody is buying them right now...so none of it matters. The loans most likely meant to hold them over untill 2010 and a much improved market/economy...they've done nearly everything else already.

Okay, now, if that is the case, why are the private equity firms not chomping at the bit to loan them the money they need? See, you can provide me with 100 things that you feel the company is doing/going to do, but apparently none of the people that are in a position to help GM share the optimism, believe the rhetoric or they simply know more than you and I ever will about the true state of affairs at the big 3.

[AngryAmish]

Originally Posted by baileyrx

i dont mean the product, i mean the union members themselves. I'm sure there are good hard working union workers, but most just float along because they can! "no need to work TOO hard, I'm getting paid anyway" mentality

my post was directed at UNIONS & the work ethic they instill, not at anywhere or anybody else...

i too think unions are a hold-overs from the industrial revolution, coal mines, auto manafacturers, etc, before the gov had OSHA & other regulatory agencies in place...

still have a place today? maybe, my opinion is no. not in most company's.

now in China, Tawain, most of SE Asia, most definitely...

You are still way off base. First and foremost, a persons work ethic is and has to be judged almost solely by the quality of the product they put out. So while I definately believe you are sincere in saying you only meant the workers, you still have to draw the same conclusion. Afterall, it is the workers that build the cars.

The only other thing that would give credence to your statement would be volume, and trust me, you don't want to go down that road. judging an employee by volume is what gets you sh!tty product...especially in the automotive industry. There should be some kind of labor standard to be sure. Some kind of base quota they would have to make volume wise thats reasonable. But when you start judging a worker based on volume more then quality, thats when the consumer suffers...and the companies reputation also.


Speaking of labor standards...I'm a Teamster that works in the warehousing industry. ALMOST ALL union shops in the USA carry a labor standard for this very reason. Ours specificlly is a time standard. The company and the union each bring in a group of engineers to figure out the time it takes to do our job. non union shops dont have this. most have a incentive program that leads to high volume and horrendous saftey practices.

trust me, i used to work in a non union shop till i wised up. ive seen someones foot get ripped off by a hi-lift because the dink was trying to make incentive bonuses.

Not. Good.

[Mr. Wyndham]

Originally Posted by garagelogic

Okay, now, if that is the case, why are the private equity firms not chomping at the bit to loan them the money they need? See, you can provide me with 100 things that you feel the company is doing/going to do, but apparently none of the people that are in a position to help GM share the optimism, believe the rhetoric or they simply know more than you and I ever will about the true state of affairs at the big 3.

Why aren't people loaning money to GM, etc? You got me ...

By asking that question, though, you're mixing in a whole extra industry and their motives + abilities. I mean, how many private equity firms are in a position to freely loan out $25 billion or more to a high-risk venture in this current economy? How many private companies are willing to take that sort of a risk on such a behemoth of a company? (If you or I were in a position to do so...would we??) I doubt it's their business plan that's deterring them...but the fact that they are, in any event, losing money hand over fist and can't seem to stop the bleeding.

I don't know the exact figures...but the market has decreased from 17 billion cars to below 12 billion in not much over a year!!! Holy-crap!! That's like removing 30% of your paycheck next year without telling you. Good Luck!

The ONLY thing that is going to save them, imo...is a better economy and an improved car market because of it. This loan should be used to tide them over to that point...again, in my opinion....

[garagelogic]

Originally Posted by Dragoneye

Why aren't people loaning money to GM, etc? You got me ...

By asking that question, though, you're mixing in a whole extra industry and their motives + abilities. I mean, how many private equity firms are in a position to freely loan out $25 billion or more to a high-risk venture in this current economy? How many private companies are willing to take that sort of a risk on such a behemoth of a company? (If you or I were in a position to do so...would we??) I doubt it's their business plan that's deterring them...but the fact that they are, in any event, losing money hand over fist and can't seem to stop the bleeding.

I don't know the exact figures...but the market has decreased from 17 billion cars to below 12 billion in not much over a year!!! Holy-crap!! That's like removing 30% of your paycheck next year without telling you. Good Luck!

The ONLY thing that is going to save them, imo...is a better economy and an improved car market because of it. This loan should be used to tide them over to that point...again, in my opinion....

So why should I, I being the U.S. taxpayer, want to make the loan to GM if the risk is so high that people in the business of loaning money are unwilling/too smart to do so?

Let the damn company(s) fail and we will all be better off in the long run.

[baileyrx]

didn't we bail out Chrysler in the 80's? that seemed to work out well...
at least for 20 some years...

i say loan it to them, make them use some type of collatrel to secure the loans, if they fail anyway, we can recoup some $$

[PieNsky]

Originally Posted by gtahvit

Agreed,

Japan needs unions That is where they can be a big help. But that will never happen in Japan.

If I could have it my way. Unions should be an "oversight" organization. They go in and fix a company then they leave.

This is another misinformation. TOYOTA HONDA and NISSAN have unions in Japan but not here.

[PieNsky]

Originally Posted by gtahvit

GM's financial trouble began as a result of paying unions triple what their global competitors were paying factory workers. Yes, health care, pensions, are huge contributors to GM's overhead. But the UAW has held GM over a barrel for years. While the competition was streamlining GM was getting overcharged. The straw that broke the camels back was gas prices and the economy.

Now, I completely agree that the new deal with the union is "fair" But, I don't see the need for union any more. With Federal and State HR laws what they are today. Employees have all the protection they need. Unions for the most part are inefficient and top heavy. Based on my experience in working with them routinely.

The reason the pay is what it is, Henry Ford paid his workers more than the robber barons did. Now don't go think that he did this because he had a heart of gold. He knew he had to create a middle class for people to buy his products other than the rich who, at the time, were the ones buying automobiles. He knew other companies would have to increase what they gave to their employees and yes, they were pissed at him.

[DGthe3]

Originally Posted by garagelogic

So why should I, I being the U.S. taxpayer, want to make the loan to GM if the risk is so high that people in the business of loaning money are unwilling/too smart to do so?

Let the damn company(s) fail and we will all be better off in the long run.

. . . and the auto industry doesn't generate any taxes? From what I've found 4% of the GDP of the United States comes directly from the auto industry. 2% of the jobs in the US are tied to the Big 3. Seems like they've put a few bucks into the tax pool. They're asking to have some back for a little while.

Originally Posted by PieNsky

Sorry if this is already posted, most likely it has been corrected. My sister is retired from Ford, my father in law works for Ford, my brother in law works for Ford and I work for Toyota. We all make about the same. Ford does offer its employee's better insurance and retirement. Could you tell me where on the internet I could find your misinformation?

Cost isn't the same as pay. Unionized workers cost more than non.

[The_Blur]

Originally Posted by garagelogic

So why should I, I being the U.S. taxpayer, want to make the loan to GM if the risk is so high that people in the business of loaning money are unwilling/too smart to do so?

Let the damn company(s) fail and we will all be better off in the long run.

Start counting to a million right now. Every time you say a number, I want you to say a name out of the phone book. When you're done, you will have said somewhere around 20% of the people who have been affected. If you talk like an auctioneer, you'll be done in a few days. That's millions of lives forever changed. There aren't millions of jobs in management, automotive industries, factories, or other comparable work for these folks to work.

After that, consider all of the money the companies, dealers, and suppliers pay in taxes. Tens to hundreds of billions will disappear. You just counted to a million, so multiply that time by a factor of 10 and then that number by a factor of 100. Can you even imagine the good our country has been doing us with that money that will disappear? We're talking about educational funding, financial aid, food stamps, subsidies, roads, national defense and investments. Can you imagine losing one of those? Let's have a country without food stamps for the 5 million people that won't find a job for the next 8 years.

Losing that much of the population's employment status will cause enormous problems for other industries as well. Soon, you'll see companies that make uniforms for auto employees go under; you'll see clothing retailers go out of business for lack of sales; you'll see grocery stores collapse because all people can afford are ramen noodles.

These are bad times. Without the auto industry—yes, they are all tied together, so try losing just one of them—we are all screwed. We're looking at something far worse than the Great Depression if we fail to stop the collapse of major domestic industries. We're looking at an end to American influence overseas. We're looking at a reactionary twist in history that would make America more agrarian than it is industrial. We're looking at the country we know not being a country at all. Is that what you want? Fine—let's abandon our auto companies. 5 million lives will change immediately, and everyone else's will change thereafter. Is that really what you want?

[garagelogic]

Originally Posted by The_Blur

Start counting to a million right now. Every time you say a number, I want you to say a name out of the phone book. When you're done, you will have said somewhere around 20% of the people who have been affected. If you talk like an auctioneer, you'll be done in a few days. That's millions of lives forever changed. There aren't millions of jobs in management, automotive industries, factories, or other comparable work for these folks to work.

After that, consider all of the money the companies, dealers, and suppliers pay in taxes. Tens to hundreds of billions will disappear. You just counted to a million, so multiply that time by a factor of 10 and then that number by a factor of 100. Can you even imagine the good our country has been doing us with that money that will disappear? We're talking about educational funding, financial aid, food stamps, subsidies, roads, national defense and investments. Can you imagine losing one of those? Let's have a country without food stamps for the 5 million people that won't find a job for the next 8 years.

Losing that much of the population's employment status will cause enormous problems for other industries as well. Soon, you'll see companies that make uniforms for auto employees go under; you'll see clothing retailers go out of business for lack of sales; you'll see grocery stores collapse because all people can afford are ramen noodles.

These are bad times. Without the auto industry—yes, they are all tied together, so try losing just one of them—we are all screwed. We're looking at something far worse than the Great Depression if we fail to stop the collapse of major domestic industries. We're looking at an end to American influence overseas. We're looking at a reactionary twist in history that would make America more agrarian than it is industrial. We're looking at the country we know not being a country at all. Is that what you want? Fine—let's abandon our auto companies. 5 million lives will change immediately, and everyone else's will change thereafter. Is that really what you want?

Yes, if that's what it takes to re-boot this great country, absolutely. At least you see some things for what they are. We started down this road to ruin long before any of the most recent happenings in the financial market. We've been moving from a producing nation to a consuming nation for decades and that is the price you pay for doing so.

We're talking about educational funding, financial aid, food stamps, subsidies, roads, national defense and investments. Can you imagine losing one of those? Let's have a country without food stamps for the 5 million people that won't find a job for the next 8 years.

Other than the national defense, none of those things should be provided by the government anyway. Yes, I can imagine not having those things and it makes me optimistic about the future when I think of people who rely on themselves and the good graces of others, not the government, to get by. And based on your words, you feel none of the 5 million workers displaced by the fall of GM will be unable to find employment for 8 years? If so, that says a lot about those people. Maybe you mean they won't be able to find employment that supports their current standard of living. If so, that's a whole different thing.

Yes, 5 million lives could change dramatically, but you assume that change will only be for the worst. Some of those people will find that they are happier in another field and realize they never really liked the job they had, they just liked the paycheck.

Doom and gloom. Armageddon is what will happen if we allow a business to fail. Please. Times will be extremely difficult for some, maybe many, but the country will not collapse.

[rmyers]

Originally Posted by gtahvit

^ LOAN!
not bailout. They have to pay it back with interest.

You are assuming they will be able to pay it back.