Wednesday, January 25, 2006

Unions Closed The Plants.

"When more and more people are thrown out of work, unemployment results." ~ Calvin Coolidge

Ford motor company has announced this week that it intends to close 14 plants and lay off some 30,000 workers due to loss of revenue. There are, no doubt, many factors that lead to this drastic action, but I think it has more than a little to do with the fact that the unions are so heavily involved in every aspect of the Automobile industry.

In Kansas City, where I am from, there are two major auto plants. Ford in Claycomo, Mo, and General Motors in Kansas City, Kansas. Years ago I went to the GM plant to apply for a job, and was told they weren't even taking applications. They informed me that there were currently hundreds of GM employees that were laid off at the moment, and had been laid off for years.

Later, when I was working as a carpet cleaner, I had the opportunity of cleaning a carpet in the home of one of those laid off GM employees. This was a new home, approximately $600,000.00, and the owner hadn't worked for a decade.

I was incredulous. How can someone who doesn't even have a job afford a home that costs over half a million dollars?

He explained it to me.

As a union employee, he was being compensated for being laid off by the company. He said he received 70% of his former salary, which in itself, was substantial. He had been getting paid 70% of his salary for over 10 years and counting! In addition to that, he was still eligible to receive health benefits and other perks.

Now, I am the first to admit that I am woefully ignorant about economics, but it seems logical to me, that if laid off employees of Automobile corporations were subject to the same unemployment compensation and other disadvantages of being laid off as the rest of us poor unrepresented slobs, maybe Ford and GM wouldn't be in quite so tenuous a position, and might not even have to be forced to close some of their facilities.

There are literally hundreds, perhaps thousands of laid off automobile employees sitting comfortably on their wallets, while the rest of us work long underpaid hours just to be able to pay the ridiculous prices for the products they no longer have anything to do with producing.

What's wrong with this picture?

It would seem to me, that if they weren't being forced to pay people who are not even producing anything for them, and haven't for a number of years, they might be able to keep the costs of production down, and in so doing, keep the prices down to a point where the average non Automobile factory worker could afford to buy new cars from them.

If it weren't for the unions, they might not have to cut production.

Now, don't misunderstand me. I realize that the unions made an important contribution in regards to improving the lot of America's working man back when there were no regulations and no minimum wage, etc. Americans are much better off today than we were back in the early 1900's. And the credit rightfully goes to the establishment of the labor unions.

But the unions have gained so much power, so much political clout, that they have lost sight of their original purpose, that is, to insure the working man of a fair and equitable wage, better working conditions, security in retirement, and affordable health care.

And their lust for power has undermined the very workers that they were founded to benefit. The quality of the product has taken a back seat to greed.

And now, the workers and the corporations are suffering for it.


Blue Cross of California said...

Great blog I hope we can work to build a better health care system as we are in a major crisis and health insurance is a major aspect to many.

jgf said...

Go figure. I'm on unemployment and get 40% of my salary and no health benefits and that's for just 26 weeks. If I got what they did, I might just stay laid off!

Old Soldier said...

Care to guess the annual compensation for the president of the UAW?

Toad734 said...

Greedy corporations, CEOs, stockholders, Free Trade and shitty cars no one wants closed those plants. Exploitation by the people mentioned above in the early 20th centrury is what created trade unions, not greed.

Why do you blame the guys making 30,000 per year? Why wouldn't you blame the CEO who is responsible for them making shitty cars no one wants while making 12 million dollars per year? The top 3 at Ford earned over 16 million dollars last year. That's over 500 working peoples salary. Since 2000 Ford has eliminated over 22,000 jobs. Apparently just laying hourly workers off doesn't help much. Maybe they should start looking into laying off the big salary people who are supposed to know what they are doing.

KEvron said...

come on, mark. anecdotal evidence is no evidence at all. especially when you add "if it's like this everytime and everywhere". hooey.

american car companies have failed to design cars that appeal to the public, so their sales have dropped off. that's the reason for the cuts. not some preposterous tale of union workers recieving outrageous severance packages.

union labor built this nation.

KEvron, ibew, local 6

KEvron said...

"If I got what they did, I might just stay laid off!"

exactly! so why does anyone bother to work at all, when all they need to do to collect is get laid-off? something smells fishy about this tale. i work in one of the strongest union bastions in the country (san fran), and i've never heard of anyone getting a severance package of any sort. we get laid-off, we collect unemployment until we get hired again. severance? butkus.


Mark said...

i didn't say anything remotely resembling "everytime, everywhere", Kev. You really must be on drugs. I also said nothing about severance packages. What the guy I talked to was getting was unemployment, supplied to him by the labor union, not severance pay. He was still technically an employee of GM. He was on a waiting list to get rehired. Both GM and Ford have long rehire waiting lists. Whatever union you are a member of is not the UAW, which, along with the Teamsters is the most powerful unions in the country.

Do the math. If they are paying even as little as 1/3 of their previous salary, it is still a heck of a lot of money being paid to people who aren't being productive. And they make a heck of a lot more than 30,000 a year.

Toad, you simply must get over that bad case of class envy you have there. If you take the money away from the rich as you seem to want, they will eventually get rich again. That is their gift. get over it.

Toad734 said...

If that is the case why are you and them both so worried about higher taxes for the rich?

KEvron said...

"i didn't say anything remotely resembling 'everytime, everywhere'"

no, you said:

" seems logical to me, that if laid off employees of Automobile corporations were subject to the same unemployment compensation and other disadvantages of being laid off as the rest of us...."


"There are literally hundreds, perhaps thousands of laid off automobile employees sitting comfortably on their wallets...."

i reduced this to "everytime, everywhere", for the sake of simplicity. it is at least "remotely" accurate. and the second sentence underscores the fallacy in presenting anecdotal evidence; you've taken this one rather dubious case, which we must accept on your word alone (i'm not implying a lie, just the acute possibility of inaccuracy), and applied it, without proof, to "literally hundreds, perhaps thousands".

unemployment insurance is administered by the state, not by unions. it doesn't last for years, certainly not for decades. and if you friend is receiving money from his union ("....unemployment, supplied to him by the labor union...."), then it would have no impact on the manufacturers; unions receive their funds from their members.

"And they make a heck of a lot more than 30,000 a year."

i never made this claim. knew it to be inaccurate when i first saw it.


KEvron said...

let me change that to "thought it to be naccurate". as far as i know, that may well be the median wage for auto industry workers. anyone got the 411 on this?


Anonymous said...

The unions didn't close those plants.

Yes, there are some gross examples of union abuse, it happens. I'm pretty sure though, convinced, actually, that the inequities given upper managment in these situations far outway the meager entitlements afforded the average worker. First I am not at all sure that I believe your story. One of you is full of poop, either the ex-UAW worker was feeding you a line (highly likely) or you are feeding us a line (just as likely). Even if your story is true, Why shouldn't a man who has given his entire lifestyle over to "the company" seek some security for his sacrifice?

He didn't just invest a few 'un-needed' dollars for his security, as most shareholders do, he invested his entire life to that company. They should be able to just dismiss him because they found someone who could do the work for a few dollars cheaper? Is that fair? Some overpaid know-nothing should get more consideration for his finacial support than the people that actually perform a function within the company do? Odds are that the shareholder isn't even aware that he has money invested! Some money monkey in the local bank has probably sold him mutual funds that he is not even familiar with. BUT because it is his financial burden the law makes sure he gets his share before the worker. Is this fair? One man invests his life, the other a tax shelter? Do you honestly expect me to feel sorry for the shareholder? He looks at his ROI and says' gee I only made 4% this year, huh, I wonder why that is? I might have to change brokers. The worker of course is fully entitled to go find a new job at McDonalds for minimum wage, or maybe he can start his own janitorial service.
But it will cost him a fortune to seek any kind of retribution from the company. Probably more than he can win, in legal costs. Besides a deal is a deal. The company signed the labor contract with the full understanding that if they couldn't perform THEIR job and keep the company afloat then the shareholder would have to pay off the employees. No-one held a gun to their heads no one forced them to sign. In my limited experience, my own company went approached the negotiating table with an offer of a "secure employment clause" in exchange for other concessions (we gave up a lot of our medical benefits in exchange for this clause) In the end, they renegged. After 6 or 7 years of paying our own health insurance premiums, lay-offs came and the company stole our job-security payments, in complete violation of the contract THAT THEY!! INSISTED ON. They got away with it because nobody could afford the lawyers fees to contest the legality of their decision. If some-one had, I would think that he should be living in the CEO's $6,000,000 home, along with the CEO's trophy wife and first born. THAT would seem fair to me. Get with it man, If they (Big Companies and their puppets) insist that it is us or them then I choose us. You should too.

Complaining that someone else has it better than you is a waste of breath, do something for yourself and quit wining about unions, better yet join one and do yourself a favour.