Friday, November 21, 2008


Biggest Contributor To Detroit’s Demise

(Nov. 20, Detroit, MI) Driving the Edsel Ford Expressway from outer Dearborn to Harper Woods transects the heart of the American auto industry. Detroit and its surrounding communities have long been synonymous with Ford, Chrysler and General Motors, the “Big Three” of domestic automobiles, for decades. Many cities and towns in Michigan have been home to manufacturing plants not only for the vehicles themselves but also of the many components that constitute the finished product.

Detroit metropolitan area has some of the highest price real estate in the nation within sight of some of the lowest. It has always been a place where prosperity and poverty have knocked heads. The endemic, pervasive poverty here and across this part of the state, has been a by product of prosperity. The unique element in this familiar two sided gulf separating the haves from the have-nots, is a huge population of high end middle classers who have shared in the prosperity much to the detriment of the very source of their prosperity. The vast numbers of these gulf inhabitants are card carrying members of the United Auto Workers union; one of the most complicit players in the cast of corrupt, greedy buffoons on the bridge as their cumbersome, top heavy ship has veered towards the rocks.

They are not in unfamiliar waters although they now appear poised to violently smash into the rocky coast and sink. They have navigated turbulent tides and currents, often taking on a threatening amount of water but always, somehow, narrowly avoided this looming catastrophe. Make no mistake about it: if the auto industry collapses, it will be a catastrophe for our entire economy. That said; it should happen. If the free marketeers of this long beleaguered industry, doomed by so many self inflicted injuries, have steered towards the rocks confident they would not make contact, this time they should meet their long overdue fate.

United Auto Workers union current president, Ron Gettlefinger and all his predecessors should be hand-cuffed to the deck of their sinking ship. The bloated contracts benefit packages, and other demands from the arrogant, spoiled, greedy union members have arguably been the biggest single factor in the history of Detroit’s struggles. The practices of the UAW ushered in the era of American manufacturers and industry moving their facilities off shore taking those jobs elsewhere. Why pay a union member $22 per hour for a 32.5 hour work week when work forces in most of the world would work for much less? Corporate CEO’s, left with no choices if their enterprises were to remain competitive in the face of overwhelming costly demands of the UAW, decided to move. Threats of strikes, actual strikes and other “job actions” were among the favored tactical intimidations the union (all unions, for that matter) used to bully the auto makers into concessions: higher wages, shorter work weeks, extended paid vacation and other leave, as well as full employer provided health care not only for active members but for retirees as well. As the union members grew lazy and overpaid throughout the past years, the Big Three were beginning to hemorrhage. The ranks of active members were declining while the number of retirees was growing into a crushing weight. Still the unions had the arrogance and gall to seek ever more while their productivity was driving auto makers into an uncompetitive corner. As globalization spread, the union remained defiantly oblivious.

This trend began in 1978 when Chrysler was on the verge of failure. Lee Iacocca, widely recognized as Chrysler’s savior, went hat in hand to Washington seeking guaranteed loans to prop up the once proud, suddenly crumbling giant. However, Iacocca was able to identify and correct many of the ills that were bringing his company and the entire automotive industry down. He peered over the horizons and saw the onslaught of foreign cars to come. If the American automotive industry was to survive into the future, along with drastic managerial restructuring, the UAW was going to have to play ball. Iacocca saved Chrysler with the UAW making virtually no real concessions.

By the late 1990’s it was estimated that the manufacturer’s suggested retail price for every American made vehicle had an additional $3000 to $4500 tacked onto it just to pay for union worker’s benefits. Their greed was insatiable; their willingness to see reality and negotiate3 in good faith was totally absent.

Their time of comeuppance has arrived. Let Detroit fail. Allow Chrysler, Ford, Gm and the UAW go down of the sinking ship of their own making. They now whine and cry about their plight, still unable to admit that the entire crisis is of their own construct, and go to Capitol Hill literally demanding to be handed $25 billion from Congress; they expect the taxpayer to “Bail them out”. If this was not so blatantly unbelievable, if the crisis not so profound, t6heir begging would be comedic.

No one is laughing now. Apparently the American public has seen through all the whining, crying, fit throwing and shouting from the industry and the guilty UAW. A recent national poll showed the public to be strongly against any Congressional bailout of the auto industry by over 51%. More than half of the country thinks the Big Three should go away. This is no surprise. The UAW assembled cars have been of inferior quality to those coming from Japan and other overseas competitors for so long that 42% of car owners consider American autos to be “junk”, “lemons”, “low quality, low reliability” and simply not their first choice when purchasing a car or SUV.

It is estimated that over 2.1 million jobs will vanish if this big ship goes down. Many of the jobs lost, unfortunately will not be UAW members but real workers, not members of “big labor’ who earn honest livings. Clearly our staggering economy cannot afford to pour millions of workers into the growing pool of the unemployed. The unemployment rate is already at a 16 year high with no end in sight.

Despite all the reasons to help, to “bail out” the auto industry, there are other practical, perhaps more cold-hearted, yet fiscally sound, approaches other than tossing our good money after bad. Let them perish in the cold waters of Lake Michigan. Only with profound systemic change across all sectors of the auto-industrial complex, would such a investment be worthwhile. Given the sorry history of this town, this industry and the UAW that is extremely unlikely. Screw them. They have screwed us long enough.

Congress and the industry should give Mr. Gettlefinger their collective “middle fingers”. He should be sent packing and told to stick his finger up his ass. The UAW as a whole can stick all their fingers up all their over paid, lard-asses. Enough is enough.

Jim Tailfin, Special Correspondent, writing for TBC from Flint, Michigan.

Copyright TBC 2008 © All Rights Reserved

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