Posted by
Reaganac on Thursday, November 13, 2008 1:57:21 PM
There are many uncertainties in the current global economic crisis. The current spotlight is on the Automobile industry in the United States. All of the big 3, GM, Ford and Chrysler are in dire financial straits and looking to get financial help from the U.S. Government just like the banking industry. I was against the original bailout, and I am against the bailout of the U.S. auto industry. I realize many will be adamantly opposed to my position, and I respect their right to that opinion, but I will lay out my opposition nonetheless.
The U.S. auto industry has been riding a fine line between success and failure for decades now since the rise of the Japanese auto industry. The playing field has grown increasingly tilted as Japanese and Korean automakers have expanded their hold on the American consumer, including expanding their manufacturing base to include factory facilities here in the United States WITHOUT having to deal with the UAW, by building in areas of the country where wages are notoriously low and unions are not readily accepted.
The Japanese automobile manufacturers consider unions the plague, And the United Auto Workers (UAW) admit having a tough time recruiting new union members when they visit Japanese manufacturers' plants here in the U.S. Japanese auto makers in the U.S. are winning their battle with the UAW because the people they employ are convinced that benefits are good and the union couldn't do any better. Worse yet for the UAW, conditions are better in these plants in some areas than in UAW plants. An example of a happy non union plant is in the Toyota plant in Georgetown, Kentucky. The workers are now being paid more and getting better bonuses than UAW workers average at domestic plants. Yet the UAW continues to try. It attempted to organize the workers at Subaru in Indiana at least three times. The result ….nothing for the UAW. The Subaru plant started producing Camrys in a joint venture with Toyota in April.
Why is this possible? The fact of the matter is that Unions have overplayed their hands for years, and added unrealistic amounts of pork to their workers benefits at the expense of the companies they work for, sometimes sidestepping larger issues for those they represent, all the while flaunting the dreaded S word in the process, to get their way. This strategy worked for many years, and did a lot of good for union workers along with the bad. Unfortunately, it is that same strategy, a strategy which reduced the margin between success and failure for these iconic American companies, which is now threatening to destroy these automotive giants; the very benefits which were negotiated over all these years, which leave these companies hemorrhaging financially at an astounding rate when the economic realities of today have reared their ugly heads.
I do not blame the UAW entirely for the impending doom and failure of the big 3, they have done plenty of damage on their own with things like skyrocketing executive compensation, and total disregard of the American consumer’s demand for quality products for years. But the bottom line is someone needs to take the poison in order to save the industry, and it should not be the average American taxpayer with a bailout. The answers to these Auto giants problems must come through the same parties that got them where they are today, the big 3 must find their own way, however painful it may be, realizing that after they reach bottom there is nowhere to go but up.