If I Had A City, It Would Look Like Detroit
Liberals deserve most of the blame for Detroit’s bankruptcy but their labor union allies can also claim credit. The decline of the auto industry was just one of Detroit’s problems, but it was significant and a self inflicted wound.
The United Auto Workers (UAW) had a major role in the GM and Chrysler bankruptcies. They raised labor costs of Detroit’s Big 3 from 50 to 80 percent above that of the U.S. employees of Toyota, Honda and Nissan. In 2006, General Motors paid its unionized workers $70.51 an hour in wages and benefits.
Chrysler paid $75.86 an hour. These costs put Detroit automakers at a significant competitive disadvantage. Toyota was paying $47.60, Honda $42.95 and Nissan $41.97.
The U.S. government will lose about $23 billion on the auto bailouts, and they could have been executed with no net cost to taxpayers. This happened because the Obama administration gave the UAW preferential treatment, and they were not required to accept standard bankruptcy concessions.
UAW membership went from over 1.5 million in 1979 to just 300,000 by 2009.
The liberals will not listen to us but we recommend this 2008 editorial from the liberal Toledo Blade. They endorsed Obama in 2008 and 2012, but even they acknowledge the UAW was a major reason for Detroit’s auto fall. According to the newspaper:
• A good deal of the blame belongs to the UAW, and it’s about time the union admitted its past mistakes. They took advantage of the U.S. automakers’ pre-eminent position in the market after World War II to win unprecedented concessions from weak industry executives willing to make any concession to maintain labor peace.
• As long as American cars dominated the market and the money kept rolling in, the automakers were willing partners in a process that saw the quality of American cars steadily decline, in no small part because many union workers took advantage of their cushy contracts to do shoddy work on the assembly line – when they weren’t actively sabotaging vehicles whenever they were angry with management over real or supposed wrongs.
• As Time magazine reported in 1972, thousands of vehicles made at GM’s Lordstown, Ohio, plant rolled off the line ‘with slit upholstery, scratched paint, dented bodies, bent gearshift levers, cut ignition wires, and loose or missing bolts.’
• So many cars and trucks were shipped to dealerships with missing bolts and screws, wiring that shorted out, and other results of poor workmanship that the dealers were forced to hire repairmen to fix the new cars before they could be sold to the public. One of those repairmen said ‘it was just a way of life back then.’
• Absenteeism, especially on the day before and after the weekend, was so rampant in the industry that even the most uninformed new-car buyer knew never to purchase a vehicle manufactured on a Monday or Friday.
• The UAW would rather we forgot its rapacious past. Americans have neither forgotten nor forgiven Detroit and the UAW for decades of greed, sense of entitlement, and, especially, foisting off on consumers a poorly made product.
• The UAW could win back the trust of the American people if it admitted it took advantage of its powerful position in the past, often at the expense of American consumers who got stuck with inferior vehicles, the prices of which were unduly inflated by fat union contracts.
• The union should join with management in aggressive steps to get rid of workers who fail to do a quality job, are frequently absent, or are guilty of vandalism on the line. It’s a confession that must be backed with action, and it just might win back some of those disaffected customers.