"Do you think money should come out of your wallet to cover greedy union fat-cats?
The United Auto Workers Union says "YES"... to the tune of $25 billion.
And right now, as you read this letter, Big Labor is aggressively twisting arms in Washington D.C. to make it happen.
You've heard the nightly news.
You've heard the desperate reports that $25 billion - or even more - of your hard-earned tax dollars are needed right now or the auto industry may collapse by the New Year.
You've heard the horror stories... decent hard-working Americans will lose their jobs if something isn't done this very second....
Well... it's not quite that simple.
C. Edmund Wright, with the Internet blog, The American Thinker wrote:
"Make no mistake, this is about the unions, the whole unions and nothing but the unions. It has nothing to do with what a sustainable U.S. auto industry looks like."
But more to the point, will giving Detroit a pound of flesh avert economic disaster?
Former Presidential candidate Mitt Romney says the opposite is true.
In a recent Opinion Editorial published in The New York Times, Romney says if Detroit gets your tax dollars as requested, "you can kiss the American automotive industry goodbye. It won't go overnight, but its demise will be virtually guaranteed." [Emphasis Mine]
Romney goes on:
"... the automakers will stay the course - the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses. Detroit needs a turnaround, not a check."
Peter Flaherty of the National Legal and Policy Center agrees:
"If he [President-elect Obama] provides a short-term fix now on the UAW's terms, these companies are doomed. Later, he will face requests for even more taxpayer money."
And the irony here is that hard-working folks like us only get insult on top of injury.
C. Edmund Wright again:
"Americans who have seen their 401 K's and jobs go away might well balk... Folks will lose patience with semi-skilled assembly line workers retiring in their 50's and living like royalty."
The legendary figure Robin Hood didn't steal from the poor and give to the rich.
A rough economy is not an excuse for stupidity, and it is most certainly NOT an excuse to pander to special interests at American taxpayers' expense!
Tell our elected officials to put an end to the INSANITY right now.'
Lori Roman, a former manager for General Motors, summed it up best in a recent Opinion Editorial published by The Examiner in Washington D.C.
According to Roman:
"[W]e are asking taxpayers who make market-based wages to bail out autoworkers who make wages that do not correlate in any way to their skill level in the workforce. Why should other manufacturing workers who make $15 an hour bail out folks who make about 70% more before benefits?"
Particularly when you consider that the United Auto Workers Union (UAW) is refusing to make concessions.
The Financial Times recently wrote:
"The US United Auto Workers (UAW) union has ruled out concessions - at least for the time being - to help rescue the ailing Detroit-based car industry. The union has been emboldened by the election of a Democratic president and a Democratic-controlled Congress."
And why won't the UAW make concessions?
Could it possibly be because higher hourly pay for auto workers translates to higher union dues?
If so, it's not just union dues at stake.
CNSNews quoting Peter Flaherty with NLPC:
"'The union will not allow companies to deploy capital in ways that the market would dictate, such as closing plants and layoffs.' NLPC says the UAW wants additional taxpayer money to enrich health and retirement plans it controls."
Spreading the misery is never sound economic policy.
But in tough economic times, shouldn't we all tighten our belts?
The Washington Post reported on an almost sublimely ridiculous interchange between Senator Bob Corker, Bob Nardelli of Chrysler and Ron Gettelfinger of UAW.
According to The Post :
"Sen. Bob Corker told Chrysler chief Bob Nardelli that one of his lobbyists told him the previous day that, even if a Chrysler plant is shut down, Chrysler still has to pay wages to its union employees. How can you come before us, Corker directed to both Nardelli and UAW chief Ron Gettelfinger, and ask us for $25 billion if you're asking taxpayers to fund this sort of activity?"
Lori Roman in the Opinion Editorial previously quoted - in which she compares giving the UAW government funding to sending an arsonist to put out a fire - gives two prime examples of the activities your tax dollars would continue to fund.
Here's the first:
"The strength of the union and the weakness of management made it impossible to conduct business properly at any level. For instance, I had an employee who punched in his time card and then disappeared."
"The rules were such that I had to spend hours documenting that he was not in his work area. I needed witnesses, timed reports, and plant wide searches all documented in detail.
"After this absurdity I decided to go my own route; I called the corner bar and paged him and he came to the phone. He received a 30-day unpaid lay-off because he was a 'repeat offender.'
"When he returned, he thanked me for the paid vacation. I scoffed, until he explained: (1) He had tried to get the lay off because it was fishing season; (2) The UAW negotiated with GM to give him the time with pay."
But the second incident is even better (or worse as the case may be):
"One afternoon I was helping oversee the plant while upper management was off site. The workers brought an RV into the loading yard with a female 'entertainer' who danced for them and then 'entertained' them in the RV."
"I went to Labor Relations for assistance. The Labor Relations rep pulled out the work rules and asked me which of the rules the men were breaking. None applied directly, of course... There were no consequences...."
"This is why, with deep regret and sympathy for the many fine folks who work in the auto industry, I think it is time for consequences. Let them file Chapter 11 and reorganize. Don't make taxpayers foot the bill for an incompetent Congress, a greedy union and wimpy managers."
Roman is not the only one advocating Chapter 11 bankruptcy for these companies.
C. Edmund Wright quoting Arizona Senator Jon Kyl:
"These companies could easily survive under a properly structured re-organization plan. 'We have a mechanism for this' said Arizona Senator Jon Kyl. 'It is called Chapter 11.'"
"A managed bankruptcy may be the only path to the fundamental restructuring the industry needs. It would permit the companies to shed excess labor, pension and real estate costs. The federal government should provide guarantees for post-bankruptcy financing and assure car buyers that their warranties are not at risk."
"In a managed bankruptcy, the federal government would propel newly competitive and viable automakers, rather than seal their fate...."
There you have it.
If done the right way, Chapter 11 could actually save the U.S. auto industry.
But throwing money at Labor Unions and companies that refuse to take steps to become solvent is not the solution. It's simply an invitation to throw more money at that same company down the road.
Steve Moore recently wrote in the Wall Street Journal:
"It's the model that Europe used in the 80s and 90's. Anytime an industry would get in distress, they would throw money at it. They haven't created a single new job in two decades, whereas the dynamic U.S. economy with entrepreneurship but also creative destruction has created 40 million jobs in the last 25 years."
Senator Richard Shelby puts it another way:
"I am concerned that, once again, we are about to employ the 'ready, fire, aim' approach to problem solving."
Shelby hit the nail on the head.
Now let's make sure the rest of our elected officials understand as well.
Yours In Freedom,