He's probably right. He's probably got so many enemies he couldn't go to an airport without anybody trying to kill him and/or his family. The CEO of American Axle better trade his corporate jet for a B-29 bomber with ball turret and tail gunners, etc. aboard.
Shoot, maybe they should change the name of American Axle to Sino-Mexi-Indian Axle since there soon won't be anything American about it in the near future?
Well the writing is on the wall lemko, and they are going to keep winning until we as americans take a stand !!! Yes gagrice, they would probably be elegible for unemployment benefits but what good will that do them ??? They are damned if they cave in and accept the company's offer which would make them lose most everything anyways and if they stay out well their is at least hope for the veterans that they will see retirement. We all know these jobs are gone anyways in the near future as Delphi, isn't keeping its promise and is rumored to send even more jobs out of the country and shut down a few more plants. So it's a damned if you do or damned if you don't. The fat cats always win and because we have no tariffs they can send the jobs south or across the pacific and import the parts duty free !!! :sick:
The working man in this country has bought into the pandering of the Democrats. One Republican stood up for the Working man and got NO support from labor. The working man has screwed himself by listening to paid off labor leaders and slick politicians.
Duncan Hunter on Fair Trade * NAFTA is a bad business deal. (Dec 2007) * Let's buy American this Christmas season. (Nov 2007) * Reflect tariffs back at competitors. (Oct 2007) * North American Union is only free trade in one direction. (Sep 2007) * Inappropriate to impose sanctions for persecuting Christians. (Sep 2007) * No NAFTA Superhighway from Canada to Mexico. (Sep 2007) * China is cheating on trade by devaluing their currency. (May 2007) * Eliminate all manufacturing taxes to increase US hiring. (May 2007) * China is cheating on trade; junk our bad China trade deals. (Mar 2007) * Voted YES on assisting workers who lose jobs due to globalization. (Oct 2007) * Voted NO on implementing CAFTA, Central America Free Trade. (Jul 2005) * Voted YES on implementing US-Australia Free Trade Agreement. (Jul 2004) * Voted NO on implementing US-Singapore free trade agreement. (Jul 2003) * Voted NO on implementing free trade agreement with Chile. (Jul 2003) * Voted YES on withdrawing from the WTO. (Jun 2000) * Voted NO on 'Fast Track' authority for trade agreements. (Sep 1998) * Rated 24% by CATO, indicating a pro-fair trade voting record. (Dec 2002) * Block NAFTA Superhighway & North American Union. (Jan 2007)
I feel there was no way of stopping the globalization of the economy here. Americans just would not give up all the cheap goods. And the cheap producer countries would have never have let us put up those barriers.
What we should have done is slow it down. Instead of opening the flood gates of cheap stuff make it take 20 years. Give us time to re educate ourselves, time for the younger generation to learn new skills, whatever they could be. Also allow the outside world to raise their standard of living first.
That would take more than 20 years but yeah something is better than nothing !!! I will always be against un free trade !!! Ross Perot's prediction back in 92' was about as accurate as getting a bulls eye in darts. Gagrice, the problem with Duncan Hunter, is he is a unknown. You and I who pay attention to politics of course know who he is. I loved Hunter's Anti-NAFTA/GATT stance but disagreed with him on the Iraq war, stem-cell research, and a few other issues but would probably be supporting him if he was still in it. If you've checked my MySpace page pal, he (Hunter) is one of my buddys. I also have Ron Paul, as a MySpace buddy. So yeah, while I'm going to support Hillary, this election I would of supported Hunter or Paul, if either were still in it but the fact remains ya'll chose the worse ones in McCain, Romney, Huckabee !!! :surprise: We didn't do much better and it goes to show you money and fame talks instead of the issues. Gagrice and I, really don't disagree on many issues when you get down to it. Imidazol97 and I see eye to eye on most issues as well. lemko and I just think a lot a like !!! :surprise:
I sell pre-owned vehicles (mainly GM brands) at a large chevrolet dealership here in Grand Rapids, MI. but am able to sell new chevrolets and in fact have a older couple on a new 2008 Impala. "It's their birthday" hahahahaha !!!
Has this shutdown at AA had a big impact on other UAW factories waiting for parts? 7 weeks is a long strike to make up. Especially if the Union gives in to the company demands. That is what happened to the 83,000 grocery workers in Southern CA. After a 20 week strike and lockout the Union got what the company offered in the beginning. I know two people that gave up and went to work for independent grocers. They have worked up to management and are making more than when they were Union clerks. I rarely shop at the Union stores after that mess.
"Throughout these negotiations, the UAW has repeatedly offered responsible proposals and counter-proposals to American Axle in an attempt to bring a conclusion to bargaining," he said in the statement.
I guess that "reasonable" is in the eye of the beholder. The last offer the company rejected was approximately 200% above the market rate.
I guess that is why the UAW does not want a neutral negotiator helping.
Lets face it. The UAW has lost every negotiation up to this point (last 2 years). Or perhaps I should say won. The members have either been able to keep their jobs or get a nice buy out. If they were not unionized they would be making even less or out of a job with nothing.
I think this is the last UAW organized company that has not been brought to it's knees by bankruptcy. Somehow AA has been able to make a profit while pretty much every other company has lost money. BUT they see that since every other competitor has lowered their wage rates that they are uncompetitive. They need to offer the same wages or they will go out of business in 2 years. From what I have read in supposedely neutral press reports AA offered the same wages as the others.
Now why is the UAW hanging on here? Because they think they have GM over the barrel. The UAW wants GM to step in and take care of its members with buy outs or one time payments. So far GM is OK because of the large truck plants only being effected but that will change soon.
If I was GM I would be pulling the tools for any products that are not trucks/ SUV's. GM has to keep the Malibu and Enclave and others going. Send the tools to AA's Mexico plant.
Then again somehow AA is still supplying the Toyota business they have.
I think GM in the next contract should get the agreement that if a union supplier plant shuts down a union GM plant the employees at that GM plant are "on strike" also and do not get paid. The UAW should stick together!
"He describes the United Auto Workers union as "masters of media manipulation" and its president, Ron Gettelfinger, as a loose cannon prone to temper tantrums. "I was flabbergasted," Mr. Miller writes. "With the fate of the world's largest industrial employer, GM, hanging delicately in the balance, we had to wait days for Gettelfinger to calm down."
--Delphi Chairman Robert S. "Steve" Miller
Miller has a new book out today called "The Turnaround Kid: What I Learned Rescuing America's Most Troubled Companies".
In it, Miller tells the inside story of how he "rushed into Delphi, used Chapter 11 to force tough medicine on its unions and whipped the giant auto supplier into shape." (WSJ)
Turns out that Miller wrote the book a bit ahead of time and is a bit chagrined that Delphi is still mired in bankruptcy, and now he gets to deal with the union and the suppliers he lambasts in his book as Delphi continues to try to emerge. Apparently HarperCollins didn't want to sit on the 40,000 printed copies any longer.
Here's a different link with another slant on the Chairman.
I guess Gettelfinger will talk to him after he gets through mowing the lawn for $65 an hour. What a hoot...
Turns out that Miller wrote the book a bit ahead of time and is a bit chagrined that Delphi is still mired in bankruptcy, and now he gets to deal with the union and the suppliers he lambasts in his book as Delphi continues to try to emerge.
Issue with his bankruptcy today has little to do with the UAW. That has all been taken care of. Issue is for them to come out of bankruptcy they need new financing. With todays financial meltdown no one wants to invest in a company that is still seen as old auto with the still, relative to it's overseas competitors, high wages.
Read your link awhile ago. Nothing there at all! Just that he worked so hard that he missed his wife dieing. And that he is really unhappy with how Gettelfinger responded to negotiations. Unfortunately we see the same happening at AA today.
he is really unhappy with how Gettelfinger responded to negotiations. Unfortunately we see the same happening at AA today.
I know some posters here idolize Gettelfinger. I don't see why the UAW membership keeps him around. He has negotiated every recent contract in favor of the company and he gets the raise in pay. Makes no sense to me. I think he is fishing for a high management position with Ford or GM. The rants and temper tantrums in negotiation is standard procedure for the top guy in the Unions.
Probably the best Union negotiator EVER was Jesse Carr of the Alaska Teamsters. He negotiated the 20 year Union Hire contract for the oil pipeline with British Petroleum. It stipulated that at least 50% of all contracts had to be with Union companies. That was a great 20 years for Alaska Union members. He was known to slam things and walk out of the negotiations. During the 1970s he was the most powerful man in Alaska. He told the governor and Senators Stevens and Gravel what to do and when to do it.
While he was alive we had 100% medical, dental, eyecare, legal services plus the finest gym facility and hospital in the State of Alaska. And good retirement.
Sounds like he counted a bunch of chickens before they hatched to me. Corporate hubris?
He got pretty much everything he wanted. The UAW backed down wages and rules. GM pitched in a bunch of money and took away some employees. All that happened was the financial market tanked partly due to the real estate mortgage industry and the available money went bye bye. Delphi is not the only one in this kind of trouble.
I know some posters here idolize Gettelfinger. I don't see why the UAW membership keeps him around. He has negotiated every recent contract in favor of the company and he gets the raise in pay.
And I think he did a great job. He kept many plants still in this country and kept many working that would be gone in a heartbeat if the companies did not cave in. I know folks are taking big hits but to me this is nothing to what would have happened w/o representation. There are way to many non skilled and skilled folks out there that would be happy to get a $15/hour job with minimal benis. Just the way it is today. Every time a new p[lant opens down south there are all kinds of high school educated workers standing in line.
And I think he did a great job. He kept many plants still in this country and kept many working that would be gone in a heartbeat if the companies did not cave in.
I don't disagree with your point at all. I just think it is a bad sign for the guy on top to get a raise when the guy at the bottom is taking a cut in pay. Just like the CEO of AA getting a big raise does not make the working man happy to do a good job for him. Of course they may not have a job to do good, if AA goes South with the work.
I agree completely that the people at the top are making too much money. Now it really varies from industry to industry and the automotive actually is at the lower end for such large companies. I think it takes a lot more work to run a huge global company like GM vs. say Boeing. I do not know for sure but I bet the Boeing CEO makes more.
Also thier pay is a result of supply and demand and I guess those at the top are really in demand.
I find it funny how Miller, who reminds me so much of Dick Cheney, will say such things like manipulating the media. For god sakes I've pointed out numerous times in the past how the wages per UAW vary it seemed weekly coming from Miller. $60 one week, $65, another, $70, $75, $88 an hour another time and he said all this while stuffing his and his top 600 executives pockets with hundreds of millions of dollars. A loophole I'd shut down as president of the U.S. and that would be the ability of large corporation like Delphi, to file bankruptcy just on its N.A. operations and not the whole company. It's BS and was done only as a means to squash the UAW. What makes me sick is the Billions of Dollars Delphi, has stashed in its coffers in Asia and Europe, and anyone who says Delphi, is just a old auto giant doesn't have a freaken clue as to how much cutting edge technology this corporation has in its R&D centers around the world. :confuse:
>"There are way to many non skilled and skilled folks out there that would be happy to get a $15/hour job with minimal benis. Just the way it is today. Every time a new p[lant opens down south there are all kinds of high school educated workers standing in line. "
What kind of education is required to be a UAW workers UP NORTH ?
I would think that a "Thinking" person with a HS education would understand that a $15 per hour job, with bennefits, that requires no real special skills, is a good thing.
Certain jobs are only worth so much compensation. It doesn't take any more skill to install lug nuts at a mfg plant that it does at a tire store. It sure as hell doesn't require more than a high school education.
Actually the tire store guy has more responsibility. He is required to actually reverse the wrench and remove the lug nuts. Remove the wheel/tire, remove the old tire, install new air valves, install the new tire, adjust air pressure to proper amount, balance the tire/wheel assembly, put the wheel back on the car, reverse the wrench again and install the lugs to proper torque for the particular car. He also has a broom available, to keep his area clean.
How many UAW would it take to do that? Might be cheaper to scrap the car than to get new tires.
Southerners understand that to get more pay, generally, more education is required. Or open a business, work hard and hopefully be successful.
Unless the US auto makers can get the cost of labor down and spend more on quality parts, they are going to continue to go under. If they started building a super reliable car tomorrow, it would take several years before the buying public would trust them again.
Could it be that Southerners understand that certain jobs are only worth so much compensation? Could that be the reason the auto mfg are moving their plant
You have made two very important comparisons.
In my career over 46 years I was sent to learn about telco equipment many times. All but one time was in the South. All those companies moved from as far North as Canada. Northern Telecom one of the largest suppliers of Telephone equipment moved from Canada to North Carolina. North Electric from Ohio to Tennessee. Comdial moved to Florida. etc, etc. I think the attitude of the workers in the South is a big bonus for the manufacturing companies. I worked 25 years in the Arctic oil fields. 4 out of 5 workers were from the South. Anyone that says that one region or another produces better workers is only fooling themselves into believing that.
Actually the tire store guy has more responsibility.
Very true. He also has to put up with irate customers, and work with very dangerous equipment. Changing tires on split rims is a hazardous job. Many times it only pays minimum wage.
I have to repeat myself. The smart UAW members have looked to the future and started retraining for a better job. Being on a sinking ship when you have a dandy life boat is not my idea of smart thinking.
Yeah, I could see this day coming !!! My cousin works at the Delta Plant and because their is no local agreement its been impossible to sort out the chaos of the new plant and he said GM management didn't make any effort to cooperate on a local agreement. As the article said the AA strike would of shut the plant down anyways.
"We've already told General Motors that we don't agree with their numbers, but we're also not going to be pitted against the transplants," CAW President Buzz Hargrove said, referring to the Japanese plants in the United States."
GM "is seeking to eliminate what it says is a $30-an-hour labor cost disadvantage versus non-unionized U.S. plants operated by Japanese-based competitors."
"We've already told General Motors that we don't agree with their numbers, but we're also not going to be pitted against the transplants," CAW President Buzz Hargrove said, referring to the Japanese plants in the United States."
Am I stupid???? They are not going to be pitted against transplants??? What the heck do they think is going to happen?? Is Canada going to subsidize their higher pay scale so the domestics can compete??? This is a plan for failure.
>"Am I stupid???? They are not going to be pitted against transplants??? What the heck do they think is going to happen?? Is Canada going to subsidize their higher pay scale so the domestics can compete??? This is a plan for failure. "
BINGO! You nailed it.
Hargrove doesn't seem to understand the real competition is the transplants. If he doesn't compete, they win.
The two tier system seems to be a way to go. Maybe I misunderstand the strategy there, but it appears that the established workers would continue as usual, but the new hires would have the choice or working for GM or they can work for one of the "transplants" for virtually the same pay. Pay that is more in line with the skill levels needed to do the job.
"The CAW says it has a strike fund of $70 million, enough to cover a six-month walkout at GM."
Wonder how long it would take GM to close up shop and move to a less hostile environment, or simply replace ALL the $30 per hour employees with $15 per hour employees. Either of these seems like a "Loose/Loose" for both GM and workers.
Sometimes companies have no choice.
IBM, for example, is working toward a no pension plan with the newer hires. They have a very good 401K plan so that the company matches a much higher % of the employee contributions. The new employees understand that they must contribute or have nothing to fall back on 30 years down the road. All employees also contribute to the health plan, whereas it used to be free.
Sad thing is that I worked in the Oshawa plants for 2 years. The workers are great. Great quality. Great work ethic. They actually care and work with the engineers and management to improve the product.
In Canada their are 3 GM assembly plants. One builds large trucks-can shut that plant down. Plenty of capacity elsewhere. The other is shutting down (under the same roof as the other car plant) in one year when the LaCrosse goes to Kansas. The other builds Impalas. LaCrosses are not exactly in high demand and it is gone in one year form Oshawa. Impala is selling gonzos but it is also being replaced in one year by the Camaro and Zeta. So they do not have much to strike on. I guess they could build Camaros in Austrailia until a new plant is prepared for the Zetas.
Reading the comments on the article, I would say most people think UAW members are overpaid and pushing GM overseas. UAW probably made a big mistake striking a company that is not making what people are buying right now. Parts for PU trucks and big SUVs.
It pays to run a high profit tiny auto manufacturer. Nov 2007
It will be a merry Christmas this year –- and for many Christmases future –- for Porsche AG CEO Wendelin Wiedeking, as the Financial Times cites sources within Porsche AG as estimating Wiedeking last year made between €60 million to €70 million -'– a thundering $88.5 million to $103.4 million based on current exchange rates.
I think CEOs in the rest of the world are taking lessons from ours. Japan and Germany have a lot more billionaires now than in the past. The money is coming from somewhere. The CEO of Porsche makes our automaker's salaries look downright puny. Of course Porsche is making money. That should be the cue to the BOD on executive salaries.
IBM also reduced bid-level managers salaries in one swoop. My family was/are IBM employees and the fact of life is pensions were reduced and now salaries were reduced...take a look at the current revenue forecast for them. They were to change or die so change they are implementing and it's working.
UAW as it exists today will be toast soon enough...change is tough but inevitable.
A big savings to IBM was when they started breaking up the "Dynasties" . There were an awfully lot of people there, that didn't need to be. Too much fat! Many found other jobs within the company. Many didn't.
A very close friend was working with an IBM sales office. His job was to make sure the sales folks got their commissions. With the various levels involved, entirely too many folks got a piece of the action. Example: A unit is was sold in Detroit, but was to be delivered to St Louis. The sales person in both cities received some sort of commissions, as well as the different levels of management. IBM simply could not compete with the "leaner" companies. They had to lean down or shut down.
When I retired in 96 the "New" retirement plan was already in place. Since I was hired 30 years earlier, I still was elegable for the old plan. However I was actually given the option of deciding between the two. Under the old plan, (which I took) I could receive nearly 5 times the pension of the new plan. As of that time, those with something like 10 years or less would fall under the new plan, but their 401K options were enhanced a bunch. Giving them the opportunity to build their own retirement, to save a bunch and get a smaller "fixed" retirement as well. New hires, of some date, have no "Fixed" retirement but 30 years of 401K options.
Seems that is what the auto mfg are trying to do. Keep the older workers at their present levels, but the new hires can not expect the same. Lean down or shut down! UAW can't seem to comprehend that.
Here in Atlanta, Ford Hapeville, GM Doraville, and BOP Doraville have all closed their doors. UAW doesn't seem to understand!
We all have the opportunity to get educated, work hard, kiss butts when necessary and end up the CEO of some company, making entirely too much money. If we don't have the ability or choose to not do that, we should be thankful that others have managed to keep the doors open for us to have a place to work.
Life isn't always fair. When I was dealing with Doctors, lawyers and Indian chiefs, and taking care of millions of dollars worth of IBM equipment, it didn't seem "FAIR" that a guy hanging bumpers was making considerably more and had better bennefits and better retirement. I was asked and given the opportunities for management, Tuition was available for college, and yada yada. I chose to not take advantage. A couple of people that I trained, eventually became my boss! Good for them! I was happy, they were happy and the doors are still open.
Excellent post! At the end of the day, you live with yourself. Your interpretation of IBM is what is happening at GM and the rest of the old big 3. Change is constant and the UAW will not be able to stop it. Period,amen.
Thanks for all of your work down in Atlanta...my family is still active up here in NJ and you contributions no doubt helped IBM evolve to where it is today. Is it perfect? Of course not.
GM will never be perfect either. They will have to make great cars that provide value to the customers, employees and shareholders equitably or die. The UAW is going along for the ride, living or dead.
Sorry Rock but I think the AA UAW is going to far. They must have some other motives. Either that or they have lost their marbles.
And GM is not sitting on their keisters. They are sourcing to other companies.
American Axle & Manufacturing Holdings Inc. said the United Auto Workers has rejected several wage and benefit proposals that are more generous than what its unionized competitors pay.
In a statement Tuesday, the Detroit-based supplier said tentative agreements had been reached on many issues but the UAW repeatedly rejected economic proposals that were "considerably higher than the market rate." It is the first time the company has indicated a willingness to pay more than its UAW-represented rivals.
The development comes as General Motors Corp., American Axle's biggest customer, said it plans to resume regular production at its Hamtramck factory beginning Monday, a month after it was idled because of the strike at American Axle. GM is buying the parts from another supplier to build Cadillac DTS and Buick Lucerne sedans, according to sources familiar with production.
Where are those other parts coming from ??? The article lacks credibility because it's coming just from American Axel, and as a person who was on strike and had to endure the lies and deceptions put out by the company well I feel differently than many of you because I have a gut feeling their are other issues beyond just wages that are left unresolved !!!
Nothing that AA makes, that I know of, is special. Most any large manufacturer has a plant that can build FWD and RWD axles. They would need to adjust the length and that is about it.
In this case the truck axles went to Dana who already has settled with their workers, and now they might get ALL the GM truck work.
The five-week UAW strike at GM's parts supplier American Axle prompted the North American carmaker to transfer a small contract to Axle rival Dana. Production of 30,000 prop shafts for GM's small trucks should begin in a matter of weeks, according to sources at Dana. The strike stopped all of GM's light-truck production in the US at seven plants, one of its passenger car plants is idling and now threatens a second car factory.
>"The five-week UAW strike at GM's parts supplier American Axle prompted the North American carmaker to transfer a small contract to Axle rival Dana. Production of 30,000 prop shafts for GM's small trucks should begin in a matter of weeks, according to sources at Dana. The strike stopped all of GM's light-truck production in the US at seven plants, one of its passenger car plants is idling and now threatens a second car factory. "
So UAW and AA are at odds, and therefore GM and it's UAW workers at 8, possibly 9, manufacturing plants are affected!
62vetteefp, I agree! The sensible thing for GM to do is to find another supplier for parts that WERE supplied by AA.
Questions come to mind:
>Without GM contracts, what would AA due for customers? Does AA have any customer base other than GM?
> Would all this reflect on the highly paid AA CEO?
> Will GM workers strike to support the AA workers?
> Is Dana a UAW shop also?
> If Dana is a UAW shop, will they strike in support of the AA workers?
> Wouldn't that also affect Dana customers such as Ford and Chrysler?
> Would all the Big 3 be forced to find a NON UNION SHOP for supplies?
> Would UAW at the Big 3 strike in support of AA and Dana.
> Would that force the North American production of UAW built cars and trucks to cease?
> Who wins there?... Asian, German, and Korean manufacturers to name a few!
I am delighted to explain. Some of this is theory and some is fact, but I feel very confident I am painting a very accurate portrait.
The early part of this decade was marked by the bursting of the tech bubble and 9-11, and resulting subsequent economic disruption. The many free trade agreements signed during the 1990's led to bleeding of middle-class manufacturing jobs that used to be the backbone of our economy. Since Bush took office, nearly 4 million manufacturing jobs have been lost. But it goes beyond that. American companies, looking for increased profits, have outsourced millions of white collar jobs so that careers that were supposed to be "the wave of the 21st century", such as computer programminng, engineering, and other high-tech areas, have continued to see negative growth.
In order to keep the economy going, the government did a series of unwise things. Our leaders were happy to have our economy heavily dependent on consumer spending (nearly 75% of total GDP) and debt (consumers have had a negative savings rate the past several years: only time since the Depression!). Moreover, the government greatly expanded legal immigration through H1B and L1 Visas. Much of this was done at the behest of the business community, which has continuously sought cheaper labor costs.
Part of the reason for this increased immigration was that the government wished to stimulate economic activity by expanding the population. Consistent with this, the government wished to greatly expand homeownership, in order to boost the land development and homebuilding industries, along with other related industires such as landscaping, real estate brokerage, and home improvement (Home Depot, etc.). Bush (also known as the Worst President in History: rest easy James Buchanan) regularly boasted about the "ownership society".
Of course, as has always been the case, these millions of first-generation immigrants (along with American renters) had little to no savings and work in service jobs with generally low household income. Notwithstanding that fact, the government and the private sector did a number of things to enable this homebuying orgy. All of these actions were unwise in the long run and are coming home to roost now.
First, Fed Chairman Allan Greenspan, the most overrated public official in American history, lowered rates more than 15 times and kept them extremely low far beyond what was dictated by circumstances. The rate cuts allowed the mortgage industry to offer unprecedented levels of adjustable-rate mortgages to unqualified borrowers, many using "teaser rates" that have huge built-in increases. The rate cuts also encouraged increased consumer borrowing for an already debt-laden society. This allowed Bush to brag about economic growth and "the ownership society" but the consequences of the rate cuts have been enormous. Consumer debt has led to unprecented levels of foreclosures and bankruptcy. The rate decreases have destroyed the value of the dollar. Now the impact of the rate cuts is being felt in terms of inflation. They have been a factor in the huge spikes in oil prices, as more people invest in commodities when dollar-denominat ed investments fall in value and inflation expectations rise.
Of course, the biggest factor in the increased oil prices has been demand from China and India. This was an unintended consequence of the aforementioned globalization, as American companies have been all too happy to outsource their production to the cheaper labor markets. Needless to say, retailers like Wal-Mart have been happy about these developments, and they have pushed hard for expanded so-called free trade. But the rapid growth of these overpopulated (both over 1 billion) third-world backwaters has hugely impacted global oil supply.
Another factor has been the greedy developers and greedy financial industry. These greedy developers, with state and local officials in their pockets, have managed to get subdivision after subdivision approved, many over the objections of the local communities. Because these developers control the politicians, they have not been forced to pay any impact fees. Consequently, taxpayers have been forced to pick up the tab for roads, schools, hospitals, and other infrastructure needs that have exploded due to unprecedented levels of hombuilding activity. Of course, this unprecedented growth has impacted traffic, the environment, schools, hospitals, and every other aspect of quality of life. Now states across the country, led by California, are going bankrupt as they try to keep up with all these costs. An unspoken factor in all of this is the fact that the homes have been built by an enormous wave of illegal immigrants from Mexico, who have been illegally hired by the greedy builders and developers. Needless to say, these low-wage, low-skill (Mexican immigrants average a 7th grade education) immigrants have been an enormous burden on social services, not to mention traffic and other factors.
As noted above, the government sought ways to put millions of people in these homes. The private sector contributed to this effort by disregarding the most basic banking fundamentals. Whereas lenders would hold mortgages in portfolio years ago, they almost never do today. Consequently, they have no concern whatsoever about the repayment capacity of the person to whom they are lending: they make their income from the origniation fees. The aforemenntioned Greenspan rate cuts allowed these lenders to offer adjustable-rate mortgages with very low rates. The lenders could then sell the loans to private investors, who would chop the pools of loans up into thousands of pieces and sell them as CMO (Collateralized Mortgage Obligations) or CDO (Collateralized Debt Obligations) tranches. Since worldwide rates have been very low, investors seeking higher yield have been all too happy to buy these, as they general ly did offer higher yields. Those investors were usually hedge funds and foreign governments, as American consumers with their negative savings have no money to invest.
Needless to say, since these CMO's and CDO's were so esoteric and chopped up, it is doubtful that anyone knew what they were holding. But no one worried because the investments were secured by American homes and, as we all know, residential real estate always increases in value (sarcasm font). What the investors didn't count on was artificial home price inflation caused by compromised lending standards (no down payment, no verification of employment and income, low credit scores, minimal job history, and high debt-to-income ratios) and "flippers", those investors that came in and drove prices up in hopes of selling the home they don't live in and making a quick buck. The CMO's and CDO's were given the AAA stamp of approval from all the rating agencies, including Moody's, Standard and Poor's, and Fitch. Of course, what people did not know (and the
Needless to say, since these CMO's and CDO's were so esoteric and chopped up, it is doubtful that anyone knew what they were holding. But no one worried because the investments were secured by American homes and, as we all know, residential real estate always increases in value (sarcasm font). What the investors didn't count on was artificial home price inflation caused by compromised lending standards (no down payment, no verification of employment and income, low credit scores, minimal job history, and high debt-to-income ratios) and "flippers", those investors that came in and drove prices up in hopes of selling the home they don't live in and making a quick buck. The CMO's and CDO's were given the AAA stamp of approval from all the rating agencies, including Moody's, Standard and Poor's, and Fitch. Of course, what people did not know (and the lazy American media failed to report) was that these agencies were getting huge fees directly from the bond issuers, a nd they were therefore interest-conflicted and incentivized to give good ratings.
The run-up in home prices, and the unsustainability thereof, were demonstrated by price-rent ratios. These ratios have historically moved in tandem but became hugely out of whack in recent years, a true red flag that the homes were overvalued. If one wasn't inclined to look at these ratios, they could simply apply common sense. Here in Atlanta, the median household income is less than $60,000 per year. Yet you can't touch a new home for less than $250,000. It doesn't add up. And, in terms of home price compared to household income, Atlanta is way better off than places like LA, Phoenix, Washington DC, Las Vegas, and Miami. But, once again, our lazy media was asleep at the switch.
The growth in homebuilding and homeownership was greatly fueled by government-sponsored agencies FNMA and FHLMC. Historically, subprime and more marginal mortgages have been sold to private investors. The primo stuff has historically been sold to "Fannie" and "Freddie", who have securitized the mortgages into CMO's and CDO's as described above. But, during the current decade, Fannie and Freddie bent their standards and they purchased and securitized billions (maybe trillions) of mortgages they would not have done previously. Consequently, a number of economists are predicting that an enormous taxpayer-funded bailout of these agencies will be necessary.
Upon taking office, President Bush appointed a Texas banking buddy, Donald Powell, to be FDIC Chairman. Mr. Powell ran a small national bank in Texas that came within an eyelash of failure in the early 1990's. Powell had a severe disdain for regulation and regulators and immediately proceeded to gut the staff. He publicly stated that "all of these small community banks could fail and it would make no difference." He implemented the MERIT program, which equated to drive-by examinations. Banks throughout the nation (particularly here in Atlanta) proceeded to go crazy making nothing but Acquisition, Development and Construction loans to developers and builders. These local bankers lent millions to developers without regard to the fact that those borrowers were overleveraged and they continued to lend like crazy even when it became evident that the market was oversupplied. Underwriting was poor, to say the least. In other words, bankers did exactly what the banking industry did in the 1980's only on a bigger scale. We as regulators stood by and let it happen. Now, development loans are defaulting at an incredibly rapid rate and the financial industry is likely to see massive bank failures.
So there it is. Incompetent government leadership, excessive desire by government leaders to make GDP and job growth numbers look good, corporate greed and short-sightedness, have led to an implosion of unprecedented magnitude. And the sad thing is that all of it could have been prevented by applying the most simple and basic fundamentals. But greed, politics, and stupidity took over.
As I have stated before, when the dust settles, this largely government-induced financial and economic implosion, which I think will rival the Depression, will be an even greater black mark on the nightmare that is the Bush legacy than even Iraq.
Just love it. Everyone is greedy and that is the root of all our problems here. Because the blue collars want to keep their high pay they are greedy, because the CEOs send the work to cheaper countries to remain competitive with the cars those same countries ship here they are greedy. I am greedy because I buy products from other countries, even though I know that hurts other Americans, because it saves me money. The government is greedy because they allow cheaper products into this country because their constituents (us!!) want to have more stuff at cheaper prices. Oil companies are greedy because they sell for what they can get (ever hear of supply and demand) so that their companies (owned by stockholders-us!!) make more money.
Everybody is in on this! And we are all looking out for ourselves and are greedy!!!!
Now all we have to do is let it go and reverse that.
Make the best cars,etc. at a fair price, keeps work here. (My Denali is in the shop yet again for repairs...Ext. Warranty was a bargain!) You think we want to buy goods from other countries?
Ensure engines perform and achieve maximum economy so we can exist on our own energy. Ensure other products are produced here at fair prices that perform what we want.
Ensure management and blue collars pay are equitable.
Share the wealth!
When the world is unbalanced, upset is caused to achieve the balance once again!
You think we want to buy goods from other countries?
Yes, I do!!! If not, stores like Pier 1 Imports would be non-existant. Not to say that imports are bad per-se, but we are, in essance, a bunch of hypocrites.
Think about it. We'll hem and haw cause we didn't get the raise we think we're worth, yet drive all over town wasting gas just to save 2 cents per gallon, or drive the extra 5 miles to get to WalMart for $12 jeans, even though the Sears around the corner has the same quality jeans for $13!!!
Lemko is right on target with his post. Everything that has happened as of late has been done for short term gain w/o any concern for what we are doing to ourselves as a whole.
And you are right, unions do do the same thing. But that doesn't make them any less valuable to our society.
It's time for Americans to unite (no pun intended) and do what's best for America, and not just themselves. All the money in the world will be useless if there is no America (as we know it) to spend it in.
The Canadian Auto Workers union said today it has reached a preliminary agreement with Ford Motor Co. on wages and benefits, and it hopes to reach a tentative contract agreement by the end of the week. The agreement -- reached almost five months before the current contract expires -- calls for a three-year deal with no changes in base wages. There would be no lower tier-two wages and benefits for new hires as the UAW agreed to in the United States last autumn. The CAW, though, agreed to a three-year " grow-in" wage and benefit structure that starts at 70 percent of current compensation levels for new hires.
that one of the reasons why we buy imports, esp cars, is that many of us felt cheated/insulted/ripped off by American cars over two decades, and it did seem that imported vehicles, Toy/Hon/Nis were made better, to better tolerances, and seemed to be more solid, esp when one closed the door...while some may argue that management was to blame, no one will EVER accuse the union of striking for better quality, so they were either the evil we say they were, or they were right in bed with management and did not care about making good product, so we, the buyers, looked elsewhere for better product, and found it...
We all WANT to maintain our industrial base, but each one of us believes that our little single purchase of a Honda will not destroy the base, but when millions of us do it, we watch our manufacturing base wither away...YET, WE FIND IT HARD TO BUY DOMESTIC PRODUCT WHEN WE STILL QUESTION WHETHER IT IS AS GOOD AS THE JAPANESE IMPORT, and we feel the better bargain, better quality, better longevity lies with products other than the Big 3...
Notwithstanding what rocky would post, the fact is that the UAW has never done anything to make us believe they really care about their product, just about contracts and wages, yet if their product was made with excellence and quality, the Japanese product would be the one to wither on the vine...the UAW has never done ANYTHING to inspire us to buy their product, except to advertise to "Buy American" but continued to give us poor product, until recently...
By now, too many people have no loyalty to Big 3, as they squandered their reputation for any quality whatsoever, and now they must win over the older folks who remember the crap of the 70s, 80s, and 90s, and the younger folks who really have no brand loyalty at all to an American product...
The Big 3 plus the UAW together enjoyed the 7 fat years when they had them, but never figured on 14, 21, 28, or more lean years, because once they lost us, we were biased against them forever...
Almost like "Fool me once, shame on you, fool me twice, shame on me"...after years of boat-anchor junk, many Americans felt they had been fooled enough...while I may blame the UAW, and you may blame management, either one makes us avoid the Big 3 product, so until they all get their act together, Big 3 sales will continue to drop, and, while we lament the loss of American jobs, when one thinks he avoided buying a piece of American junk, nobody really cares about the American job loss, because most of us theink they didn't deserve the jobs to begin with, because trash belongs in the landfill, not a vehicle showroom...
Comments
Shoot, maybe they should change the name of American Axle to Sino-Mexi-Indian Axle since there soon won't be anything American about it in the near future?
-Rocky
Duncan Hunter on Fair Trade
* NAFTA is a bad business deal. (Dec 2007)
* Let's buy American this Christmas season. (Nov 2007)
* Reflect tariffs back at competitors. (Oct 2007)
* North American Union is only free trade in one direction. (Sep 2007)
* Inappropriate to impose sanctions for persecuting Christians. (Sep 2007)
* No NAFTA Superhighway from Canada to Mexico. (Sep 2007)
* China is cheating on trade by devaluing their currency. (May 2007)
* Eliminate all manufacturing taxes to increase US hiring. (May 2007)
* China is cheating on trade; junk our bad China trade deals. (Mar 2007)
* Voted YES on assisting workers who lose jobs due to globalization. (Oct 2007)
* Voted NO on implementing CAFTA, Central America Free Trade. (Jul 2005)
* Voted YES on implementing US-Australia Free Trade Agreement. (Jul 2004)
* Voted NO on implementing US-Singapore free trade agreement. (Jul 2003)
* Voted NO on implementing free trade agreement with Chile. (Jul 2003)
* Voted YES on withdrawing from the WTO. (Jun 2000)
* Voted NO on 'Fast Track' authority for trade agreements. (Sep 1998)
* Rated 24% by CATO, indicating a pro-fair trade voting record. (Dec 2002)
* Block NAFTA Superhighway & North American Union. (Jan 2007)
What we should have done is slow it down. Instead of opening the flood gates of cheap stuff make it take 20 years. Give us time to re educate ourselves, time for the younger generation to learn new skills, whatever they could be. Also allow the outside world to raise their standard of living first.
Well I better get back to selling cars.........
-Rocky
2021 Kia Soul LX 6-speed stick
-Rocky
Where's this going to lead?
2014 Malibu 2LT, 2015 Cruze 2LT,
Slugging It Out
I guess that "reasonable" is in the eye of the beholder. The last offer the company rejected was approximately 200% above the market rate.
I guess that is why the UAW does not want a neutral negotiator helping.
Lets face it. The UAW has lost every negotiation up to this point (last 2 years). Or perhaps I should say won. The members have either been able to keep their jobs or get a nice buy out. If they were not unionized they would be making even less or out of a job with nothing.
I think this is the last UAW organized company that has not been brought to it's knees by bankruptcy. Somehow AA has been able to make a profit while pretty much every other company has lost money. BUT they see that since every other competitor has lowered their wage rates that they are uncompetitive. They need to offer the same wages or they will go out of business in 2 years. From what I have read in supposedely neutral press reports AA offered the same wages as the others.
Now why is the UAW hanging on here? Because they think they have GM over the barrel. The UAW wants GM to step in and take care of its members with buy outs or one time payments. So far GM is OK because of the large truck plants only being effected but that will change soon.
If I was GM I would be pulling the tools for any products that are not trucks/
SUV's. GM has to keep the Malibu and Enclave and others going. Send the tools to AA's Mexico plant.
Then again somehow AA is still supplying the Toyota business they have.
I think GM in the next contract should get the agreement that if a union supplier plant shuts down a union GM plant the employees at that GM plant are "on strike" also and do not get paid. The UAW should stick together!
--Delphi Chairman Robert S. "Steve" Miller
Miller has a new book out today called "The Turnaround Kid: What I Learned Rescuing America's Most Troubled Companies".
In it, Miller tells the inside story of how he "rushed into Delphi, used Chapter 11 to force tough medicine on its unions and whipped the giant auto supplier into shape."
(WSJ)
Turns out that Miller wrote the book a bit ahead of time and is a bit chagrined that Delphi is still mired in bankruptcy, and now he gets to deal with the union and the suppliers he lambasts in his book as Delphi continues to try to emerge. Apparently HarperCollins didn't want to sit on the 40,000 printed copies any longer.
Here's a different link with another slant on the Chairman.
I guess Gettelfinger will talk to him after he gets through mowing the lawn for $65 an hour. What a hoot...
Issue with his bankruptcy today has little to do with the UAW. That has all been taken care of. Issue is for them to come out of bankruptcy they need new financing. With todays financial meltdown no one wants to invest in a company that is still seen as old auto with the still, relative to it's overseas competitors, high wages.
Read your link awhile ago. Nothing there at all! Just that he worked so hard that he missed his wife dieing. And that he is really unhappy with how Gettelfinger responded to negotiations. Unfortunately we see the same happening at AA today.
I know some posters here idolize Gettelfinger. I don't see why the UAW membership keeps him around. He has negotiated every recent contract in favor of the company and he gets the raise in pay. Makes no sense to me. I think he is fishing for a high management position with Ford or GM. The rants and temper tantrums in negotiation is standard procedure for the top guy in the Unions.
Probably the best Union negotiator EVER was Jesse Carr of the Alaska Teamsters. He negotiated the 20 year Union Hire contract for the oil pipeline with British Petroleum. It stipulated that at least 50% of all contracts had to be with Union companies. That was a great 20 years for Alaska Union members. He was known to slam things and walk out of the negotiations. During the 1970s he was the most powerful man in Alaska. He told the governor and Senators Stevens and Gravel what to do and when to do it.
While he was alive we had 100% medical, dental, eyecare, legal services plus the finest gym facility and hospital in the State of Alaska. And good retirement.
Then maybe he did not see the downturn in the economy coming. Many did not.
He got pretty much everything he wanted. The UAW backed down wages and rules. GM pitched in a bunch of money and took away some employees. All that happened was the financial market tanked partly due to the real estate mortgage industry and the available money went bye bye. Delphi is not the only one in this kind of trouble.
And I think he did a great job. He kept many plants still in this country and kept many working that would be gone in a heartbeat if the companies did not cave in. I know folks are taking big hits but to me this is nothing to what would have happened w/o representation. There are way to many non skilled and skilled folks out there that would be happy to get a $15/hour job with minimal benis. Just the way it is today. Every time a new p[lant opens down south there are all kinds of high school educated workers standing in line.
I don't disagree with your point at all. I just think it is a bad sign for the guy on top to get a raise when the guy at the bottom is taking a cut in pay. Just like the CEO of AA getting a big raise does not make the working man happy to do a good job for him. Of course they may not have a job to do good, if AA goes South with the work.
Also thier pay is a result of supply and demand and I guess those at the top are really in demand.
-Rocky
What kind of education is required to be a UAW workers UP NORTH ?
I would think that a "Thinking" person with a HS education would understand that a $15 per hour job, with bennefits, that requires no real special skills, is a good thing.
Certain jobs are only worth so much compensation. It doesn't take any more skill to install lug nuts at a mfg plant that it does at a tire store. It sure as hell doesn't require more than a high school education.
Actually the tire store guy has more responsibility. He is required to actually reverse the wrench and remove the lug nuts. Remove the wheel/tire, remove the old tire, install new air valves, install the new tire, adjust air pressure to proper amount, balance the tire/wheel assembly, put the wheel back on the car, reverse the wrench again and install the lugs to proper torque for the particular car. He also has a broom available, to keep his area clean.
How many UAW would it take to do that?
Might be cheaper to scrap the car than to get new tires.
Southerners understand that to get more pay, generally, more education is required. Or open a business, work hard and hopefully be successful.
Unless the US auto makers can get the cost of labor down and spend more on quality parts, they are going to continue to go under. If they started building a super reliable car tomorrow, it would take several years before the buying public would trust them again.
http://editorial.autos.msn.com/article.aspx?cp-documentid=435706>1=22017
Kip
You have made two very important comparisons.
In my career over 46 years I was sent to learn about telco equipment many times. All but one time was in the South. All those companies moved from as far North as Canada. Northern Telecom one of the largest suppliers of Telephone equipment moved from Canada to North Carolina. North Electric from Ohio to Tennessee. Comdial moved to Florida. etc, etc. I think the attitude of the workers in the South is a big bonus for the manufacturing companies. I worked 25 years in the Arctic oil fields. 4 out of 5 workers were from the South. Anyone that says that one region or another produces better workers is only fooling themselves into believing that.
Actually the tire store guy has more responsibility.
Very true. He also has to put up with irate customers, and work with very dangerous equipment. Changing tires on split rims is a hazardous job. Many times it only pays minimum wage.
I have to repeat myself. The smart UAW members have looked to the future and started retraining for a better job. Being on a sinking ship when you have a dandy life boat is not my idea of smart thinking.
Key GM plant shut as workers walk out (CNNMoney)
-Rocky
GM Canada seeks big cuts to labor cost
GM "is seeking to eliminate what it says is a $30-an-hour labor cost disadvantage versus non-unionized U.S. plants operated by Japanese-based competitors."
Am I stupid???? They are not going to be pitted against transplants??? What the heck do they think is going to happen?? Is Canada going to subsidize their higher pay scale so the domestics can compete??? This is a plan for failure.
BINGO! You nailed it.
Hargrove doesn't seem to understand the real competition is the transplants. If he doesn't compete, they win.
The two tier system seems to be a way to go. Maybe I misunderstand the strategy there, but it appears that the established workers would continue as usual, but the new hires would have the choice or working for GM or they can work for one of the "transplants" for virtually the same pay. Pay that is more in line with the skill levels needed to do the job.
"The CAW says it has a strike fund of $70 million, enough to cover a six-month walkout at GM."
Wonder how long it would take GM to close up shop and move to a less hostile environment, or simply replace ALL the $30 per hour employees with $15 per hour employees. Either of these seems like a "Loose/Loose" for both GM and workers.
Sometimes companies have no choice.
IBM, for example, is working toward a no pension plan with the newer hires. They have a very good 401K plan so that the company matches a much higher % of the employee contributions. The new employees understand that they must contribute or have nothing to fall back on 30 years down the road. All employees also contribute to the health plan, whereas it used to be free.
Times are changing!
Kip
In Canada their are 3 GM assembly plants. One builds large trucks-can shut that plant down. Plenty of capacity elsewhere. The other is shutting down (under the same roof as the other car plant) in one year when the LaCrosse goes to Kansas. The other builds Impalas. LaCrosses are not exactly in high demand and it is gone in one year form Oshawa. Impala is selling gonzos but it is also being replaced in one year by the Camaro and Zeta. So they do not have much to strike on. I guess they could build Camaros in Austrailia until a new plant is prepared for the Zetas.
http://www.autoobserver.com/2007/11/porsche-boss-dr.html
It pays to run a high profit tiny auto manufacturer. Nov 2007
It will be a merry Christmas this year –- and for many Christmases future –- for Porsche AG CEO Wendelin Wiedeking, as the Financial Times cites sources within Porsche AG as estimating Wiedeking last year made between €60 million to €70 million -'– a thundering $88.5 million to $103.4 million based on current exchange rates.
Regards,
OW
UAW as it exists today will be toast soon enough...change is tough but inevitable.
Regards,
OW
A big savings to IBM was when they started breaking up the "Dynasties" . There were an awfully lot of people there, that didn't need to be. Too much fat! Many found other jobs within the company. Many didn't.
A very close friend was working with an IBM sales office. His job was to make sure the sales folks got their commissions. With the various levels involved, entirely too many folks got a piece of the action. Example: A unit
iswas sold in Detroit, but was to be delivered to St Louis. The sales person in both cities received some sort of commissions, as well as the different levels of management.IBM simply could not compete with the "leaner" companies. They had to lean down or shut down.
When I retired in 96 the "New" retirement plan was already in place. Since I was hired 30 years earlier, I still was elegable for the old plan. However I was actually given the option of deciding between the two. Under the old plan, (which I took) I could receive nearly 5 times the pension of the new plan. As of that time, those with something like 10 years or less would fall under the new plan, but their 401K options were enhanced a bunch. Giving them the opportunity to build their own retirement, to save a bunch and get a smaller "fixed" retirement as well. New hires, of some date, have no "Fixed" retirement but 30 years of 401K options.
Seems that is what the auto mfg are trying to do. Keep the older workers at their present levels, but the new hires can not expect the same. Lean down or shut down! UAW can't seem to comprehend that.
Here in Atlanta, Ford Hapeville, GM Doraville, and BOP Doraville have all closed their doors. UAW doesn't seem to understand!
We all have the opportunity to get educated, work hard, kiss butts when necessary and end up the CEO of some company, making entirely too much money. If we don't have the ability or choose to not do that, we should be thankful that others have managed to keep the doors open for us to have a place to work.
Life isn't always fair. When I was dealing with Doctors, lawyers and Indian chiefs, and taking care of millions of dollars worth of IBM equipment, it didn't seem "FAIR" that a guy hanging bumpers was making considerably more and had better bennefits and better retirement. I was asked and given the opportunities for management, Tuition was available for college, and yada yada. I chose to not take advantage. A couple of people that I trained, eventually became my boss! Good for them! I was happy, they were happy and the doors are still open.
Kip
Thanks for all of your work down in Atlanta...my family is still active up here in NJ and you contributions no doubt helped IBM evolve to where it is today. Is it perfect? Of course not.
GM will never be perfect either. They will have to make great cars that provide value to the customers, employees and shareholders equitably or die. The UAW is going along for the ride, living or dead.
Regards,
OW
And GM is not sitting on their keisters. They are sourcing to other companies.
American Axle & Manufacturing Holdings Inc. said the United Auto Workers has rejected several wage and benefit proposals that are more generous than what its unionized competitors pay.
In a statement Tuesday, the Detroit-based supplier said tentative agreements had been reached on many issues but the UAW repeatedly rejected economic proposals that were "considerably higher than the market rate." It is the first time the company has indicated a willingness to pay more than its UAW-represented rivals.
The development comes as General Motors Corp., American Axle's biggest customer, said it plans to resume regular production at its Hamtramck factory beginning Monday, a month after it was idled because of the strike at American Axle. GM is buying the parts from another supplier to build Cadillac DTS and Buick Lucerne sedans, according to sources familiar with production.
-Rocky
In this case the truck axles went to Dana who already has settled with their workers, and now they might get ALL the GM truck work.
The five-week UAW strike at GM's parts supplier American Axle prompted the North American carmaker to transfer a small contract to Axle rival Dana. Production of 30,000 prop shafts for GM's small trucks should begin in a matter of weeks, according to sources at Dana. The strike stopped all of GM's light-truck production in the US at seven plants, one of its passenger car plants is idling and now threatens a second car factory.
http://www.philly.com/inquirer/business/homepage/20080425_China_strains_U_S__saf- ety_net.html
So UAW and AA are at odds, and therefore GM and it's UAW workers at 8, possibly 9, manufacturing plants are affected!
62vetteefp, I agree! The sensible thing for GM to do is to find another supplier for parts that WERE supplied by AA.
Questions come to mind:
>Without GM contracts, what would AA due for customers?
Does AA have any customer base other than GM?
> Would all this reflect on the highly paid AA CEO?
> Will GM workers strike to support the AA workers?
> Is Dana a UAW shop also?
> If Dana is a UAW shop, will they strike in support of the AA workers?
> Wouldn't that also affect Dana customers such as Ford and Chrysler?
> Would all the Big 3 be forced to find a NON UNION SHOP for supplies?
> Would UAW at the Big 3 strike in support of AA and Dana.
> Would that force the North American production of UAW built cars and trucks to
cease?
> Who wins there?... Asian, German, and Korean manufacturers to name a few!
Kip
I am delighted to explain. Some of this is theory and some is fact, but I feel very confident I am painting a very accurate portrait.
The early part of this decade was marked by the bursting of the tech bubble and 9-11, and resulting subsequent economic disruption. The many free trade agreements signed during the 1990's led to bleeding of middle-class manufacturing jobs that used to be the backbone of our economy. Since Bush took office, nearly 4 million manufacturing jobs have been lost. But it goes beyond that. American companies, looking for increased profits, have outsourced millions of white collar jobs so that careers that were supposed to be "the wave of the 21st century", such as computer programminng, engineering, and other high-tech areas, have continued to see negative growth.
In order to keep the economy going, the government did a series of unwise things. Our leaders were happy to have our economy heavily dependent on consumer spending (nearly 75% of total GDP) and debt (consumers have had a negative savings rate the past several years: only time since the Depression!). Moreover, the government greatly expanded legal immigration through H1B and L1 Visas. Much of this was done at the behest of the business community, which has continuously sought cheaper labor costs.
Part of the reason for this increased immigration was that the government wished to stimulate economic activity by expanding the population. Consistent with this, the government wished to greatly expand homeownership, in order to boost the land development and homebuilding industries, along with other related industires such as landscaping, real estate brokerage, and home improvement (Home Depot, etc.). Bush (also known as the Worst President in History: rest easy James Buchanan) regularly boasted about the "ownership society".
Of course, as has always been the case, these millions of first-generation immigrants (along with American renters) had little to no savings and work in service jobs with generally low household income. Notwithstanding that fact, the government and the private sector did a number of things to enable this homebuying orgy. All of these actions were unwise in the long run and are coming home to roost now.
First, Fed Chairman Allan Greenspan, the most overrated public official in American history, lowered rates more than 15 times and kept them extremely low far beyond what was dictated by circumstances. The rate cuts allowed the mortgage industry to offer unprecedented levels of adjustable-rate mortgages to unqualified borrowers, many using "teaser rates" that have huge built-in increases. The rate cuts also encouraged increased consumer borrowing for an already debt-laden society. This allowed Bush to brag about economic growth and "the ownership society" but the consequences of the rate cuts have been enormous. Consumer debt has led to unprecented levels of foreclosures and bankruptcy. The rate decreases have destroyed the value of the dollar. Now the impact of the rate cuts is being felt in terms of inflation. They have been a factor in the huge spikes in oil prices, as more people invest in commodities when dollar-denominat ed investments fall in value and inflation expectations rise.
Of course, the biggest factor in the increased oil prices has been demand from China and India. This was an unintended consequence of the aforementioned globalization, as American companies have been all too happy to outsource their production to the cheaper labor markets. Needless to say, retailers like Wal-Mart have been happy about these developments, and they have pushed hard for expanded so-called free trade. But the rapid growth of these overpopulated (both over 1 billion) third-world backwaters has hugely impacted global oil supply.
Another factor has been the greedy developers and greedy financial industry. These greedy developers, with state and local officials in their pockets, have managed to get subdivision after subdivision approved, many over the objections of the local communities. Because these developers control the politicians, they have not been forced to pay any impact fees. Consequently, taxpayers have been forced to pick up the tab for roads, schools, hospitals, and other infrastructure needs that have exploded due to unprecedented levels of hombuilding activity. Of course, this unprecedented growth has impacted traffic, the environment, schools, hospitals, and every other aspect of quality of life. Now states across the country, led by California, are going bankrupt as they try to keep up with all these costs. An unspoken factor in all of this is the fact that the homes have been built by an enormous wave of illegal immigrants from Mexico, who have been illegally hired by the greedy builders and developers. Needless to say, these low-wage, low-skill (Mexican immigrants average a 7th grade education) immigrants have been an enormous burden on social services, not to mention traffic and other factors.
As noted above, the government sought ways to put millions of people in these homes. The private sector contributed to this effort by disregarding the most basic banking fundamentals. Whereas lenders would hold mortgages in portfolio years ago, they almost never do today. Consequently, they have no concern whatsoever about the repayment capacity of the person to whom they are lending: they make their income from the origniation fees. The aforemenntioned Greenspan rate cuts allowed these lenders to offer adjustable-rate mortgages with very low rates. The lenders could then sell the loans to private investors, who would chop the pools of loans up into thousands of pieces and sell them as CMO (Collateralized Mortgage Obligations) or CDO (Collateralized Debt Obligations) tranches. Since worldwide rates have been very low, investors seeking higher yield have been all too happy to buy these, as they general ly did offer higher yields. Those investors were usually hedge funds and foreign governments, as American consumers with their negative savings have no money to invest.
Needless to say, since these CMO's and CDO's were so esoteric and chopped up, it is doubtful that anyone knew what they were holding. But no one worried because the investments were secured by American homes and, as we all know, residential real estate always increases in value (sarcasm font). What the investors didn't count on was artificial home price inflation caused by compromised lending standards (no down payment, no verification of employment and income, low credit scores, minimal job history, and high debt-to-income ratios) and "flippers", those investors that came in and drove prices up in hopes of selling the home they don't live in and making a quick buck. The CMO's and CDO's were given the AAA stamp of approval from all the rating agencies, including Moody's, Standard and Poor's, and Fitch. Of course, what people did not know (and the
The run-up in home prices, and the unsustainability thereof, were demonstrated by price-rent ratios. These ratios have historically moved in tandem but became hugely out of whack in recent years, a true red flag that the homes were overvalued. If one wasn't inclined to look at these ratios, they could simply apply common sense. Here in Atlanta, the median household income is less than $60,000 per year. Yet you can't touch a new home for less than $250,000. It doesn't add up. And, in terms of home price compared to household income, Atlanta is way better off than places like LA, Phoenix, Washington DC, Las Vegas, and Miami. But, once again, our lazy media was asleep at the switch.
The growth in homebuilding and homeownership was greatly fueled by government-sponsored agencies FNMA and FHLMC. Historically, subprime and more marginal mortgages have been sold to private investors. The primo stuff has historically been sold to "Fannie" and "Freddie", who have securitized the mortgages into CMO's and CDO's as described above. But, during the current decade, Fannie and Freddie bent their standards and they purchased and securitized billions (maybe trillions) of mortgages they would not have done previously. Consequently, a number of economists are predicting that an enormous taxpayer-funded bailout of these agencies will be necessary.
Upon taking office, President Bush appointed a Texas banking buddy, Donald Powell, to be FDIC Chairman. Mr. Powell ran a small national bank in Texas that came within an eyelash of failure in the early 1990's. Powell had a severe disdain for regulation and regulators and immediately proceeded to gut the staff. He publicly stated that "all of these small community banks could fail and it would make no difference." He implemented the MERIT program, which equated to drive-by examinations. Banks throughout the nation (particularly here in Atlanta) proceeded to go crazy making nothing but Acquisition, Development and Construction loans to developers and builders. These local bankers lent millions to developers without regard to the fact that those borrowers were overleveraged and they continued to lend like crazy even when it became evident that the market was oversupplied. Underwriting was poor, to say the least. In other words, bankers did exactly what the banking industry did in the 1980's only on a bigger scale.
We as regulators stood by and let it happen. Now, development loans are defaulting at an incredibly rapid rate and the financial industry is likely to see massive bank failures.
So there it is. Incompetent government leadership, excessive desire by government leaders to make GDP and job growth numbers look good, corporate greed and short-sightedness, have led to an implosion of unprecedented magnitude. And the sad thing is that all of it could have been prevented by applying the most simple and basic fundamentals. But greed, politics, and stupidity took over.
As I have stated before, when the dust settles, this largely government-induced financial and economic implosion, which I think will rival the Depression, will be an even greater black mark on the nightmare that is the Bush legacy than even Iraq.
Unions are a microcosm of the same system, IMO.
Regards,
OW
Everybody is in on this!
And we are all looking out for ourselves and are greedy!!!!
Make the best cars,etc. at a fair price, keeps work here. (My Denali is in the shop yet again for repairs...Ext. Warranty was a bargain!) You think we want to buy goods from other countries?
Ensure engines perform and achieve maximum economy so we can exist on our own energy. Ensure other products are produced here at fair prices that perform what we want.
Ensure management and blue collars pay are equitable.
Share the wealth!
When the world is unbalanced, upset is caused to achieve the balance once again!
Regards,
OW
Yes, I do!!! If not, stores like Pier 1 Imports would be non-existant. Not to say that imports are bad per-se, but we are, in essance, a bunch of hypocrites.
Think about it. We'll hem and haw cause we didn't get the raise we think we're worth, yet drive all over town wasting gas just to save 2 cents per gallon, or drive the extra 5 miles to get to WalMart for $12 jeans, even though the Sears around the corner has the same quality jeans for $13!!!
Lemko is right on target with his post. Everything that has happened as of late has been done for short term gain w/o any concern for what we are doing to ourselves as a whole.
And you are right, unions do do the same thing. But that doesn't make them any less valuable to our society.
It's time for Americans to unite (no pun intended) and do what's best for America, and not just themselves. All the money in the world will be useless if there is no America (as we know it) to spend it in.
The agreement -- reached almost five months before the current contract expires -- calls for a three-year deal with no changes in base wages. There would be no lower tier-two wages and benefits for new hires as the UAW agreed to in the United States last autumn. The CAW, though, agreed to a three-year " grow-in" wage and benefit structure that starts at 70 percent of current compensation levels for new hires.
Sounds like a two tier system?
We all WANT to maintain our industrial base, but each one of us believes that our little single purchase of a Honda will not destroy the base, but when millions of us do it, we watch our manufacturing base wither away...YET, WE FIND IT HARD TO BUY DOMESTIC PRODUCT WHEN WE STILL QUESTION WHETHER IT IS AS GOOD AS THE JAPANESE IMPORT, and we feel the better bargain, better quality, better longevity lies with products other than the Big 3...
Notwithstanding what rocky would post, the fact is that the UAW has never done anything to make us believe they really care about their product, just about contracts and wages, yet if their product was made with excellence and quality, the Japanese product would be the one to wither on the vine...the UAW has never done ANYTHING to inspire us to buy their product, except to advertise to "Buy American" but continued to give us poor product, until recently...
By now, too many people have no loyalty to Big 3, as they squandered their reputation for any quality whatsoever, and now they must win over the older folks who remember the crap of the 70s, 80s, and 90s, and the younger folks who really have no brand loyalty at all to an American product...
The Big 3 plus the UAW together enjoyed the 7 fat years when they had them, but never figured on 14, 21, 28, or more lean years, because once they lost us, we were biased against them forever...
Almost like "Fool me once, shame on you, fool me twice, shame on me"...after years of boat-anchor junk, many Americans felt they had been fooled enough...while I may blame the UAW, and you may blame management, either one makes us avoid the Big 3 product, so until they all get their act together, Big 3 sales will continue to drop, and, while we lament the loss of American jobs, when one thinks he avoided buying a piece of American junk, nobody really cares about the American job loss, because most of us theink they didn't deserve the jobs to begin with, because trash belongs in the landfill, not a vehicle showroom...