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April 1, 2009

Detroit: Not Dead Enough!

I alluded to this Monday, but some of you may have missed it.

U.S. Secretary of Transportation Ray LaHood announced today that the Department of Transportation has posted the new fuel economy standards for cars and light trucks for the 2011 model year…

On January 26, 2009, President Barack Obama directed the Department of Transportation to review relevant legal, technological, and scientific considerations associated with establishing more stringent fuel economy standards, and to finalize the 2011 model year standard by the end of March.

Legiislation - boldly going where profitability fears to tread...

The new standard comes to us thanks to a 2007 energy law that mandates an overall 35 mile-per-gallon standard by 2020.

The Detroit News reported that the new standard will saddle Detroit’s reeling auto industry (and their dwindling number of consumers) with considerable new costs, costs that consumers may not recoup for almost eight years:

It's as though they're doing it on purpose.

Posted by Kate at April 1, 2009 1:55 AM
Comments

Buying into the small car kool-aid seems fine, until you get stuck in a western Canadian snowdrift

We don't all live in California

We have our own requirements for our vehicles - they are not just used to ferry us from home to an office job. . . . .

Some of us have real jobs whereby we need to carry tools and cargo. Jobs where trades, and actual work are valued.

So, can we just please, please, buy the vehicles we need?

Harry Reid and Barney Frank and co have no clue. They just showboat their way through broadcast sessions.

OJ was acquitted in major part because Lance Ito let cameras into the courtroom. Senators and Congressmen - does broadcasting your deliberations improve decison making? I hate seeing you harangue business leaders.

Go to h-e-double toothpicks

Posted by: Erik Larsen at April 1, 2009 2:17 AM

What a load of crap; the technology's been around for decades!
http://www.retropedalcars.com/index.asp?PageAction=Custom&ID=7

Posted by: DaninVan at April 1, 2009 2:32 AM

Hey if the wind can move a sailboat, why not a car?

Wind Powered Cars

Ya puts a turbine up on the top that catches the wind and drives a generator to generate electricity that powers the electric motors that move the car to create even more wind.

The faster you go, the better it works.

And at the end of your trip, you can sell the surplus electrons back to the power company.

Sweet.

Posted by: foobert at April 1, 2009 2:55 AM

The definition of an idiot is someone who believes his ideas will change the world. Now, to be clear, I'm not talking about someone who believes that his ideas might someday spread and become widely-held, I'm talking about someone who believes that his ideas can be imposed, by edict, on the world at large, in the face of the....you know, the world at large.

How did it come to this in the US, of all places?

Wowee.

Ayep, forget what people want to buy, we'll decide what they want to buy, because I have some addled sense of what that should be, and then we'll take billions of dollars from the population at large, in order to proffer up that product. Because now I've assumed the mantle.

Holy crap.

Most Deaf.

Posted by: EBD at April 1, 2009 2:59 AM

CAFE standards are like the minimum wage. If we just mandated $100 an hour as the minimum wage, we could end poverty. If we just mandated 100 MPG we would not be dependent on foreign oil.

While we're at it why not repeal the Laws of Gravity?

Posted by: uncle ken at April 1, 2009 4:24 AM

35MPG is not an unachievable feat for any car maker, since most of them have been operating in Europe for quite some time, selling many products that meet or exceed that requirement.

Example: Ford Focus in Canada with automatic transmission gets 24 city/33 highway.

Ford Focus in UK with automatic transmission gets 42MPG combined on gas, and 53MPG diesel.

Example: General Motors Canada, Saturn Astra 5-door with automatic transmission 24 city/30 highway

General Motors UK Vauxhall Astra 5 door automatic transmission, gas 27 city/45 highway and the diesel gets 29city/52 highway

Interestingly enough, Vauxhall sells and econobox version of the Astra 5-door with a 1.3L diesel, manual transmission that gets an advertised 44.8city/68.9MPG highway

The technology is there and has been for quite some time - consumer attitudes need to change.

Posted by: Dano at April 1, 2009 7:42 AM

Beyond April Fools.

Posted by: Liz J at April 1, 2009 7:46 AM

This is how you repay a political debt to the UAW.

I must say, though, I wonder how the Caeser salad fixings are going to find their way from California to DC. Michelle's Garden is not big enough to supply the whole market.

"The peasants have no cabbage!"

"Then let them eat lettuce".

Posted by: Shaken at April 1, 2009 7:51 AM

Of course, the Demwits are hobbling the auto industry on purpose. The whole point of the auto industry bailout plan is to make certain the companies aren't viable without government subsidy.

Thereby, all the auto workers, including those who aren't UAW members, will become utterly dependent on the feds to keep their jobs. They become quasi-government employees.

Detroit will become a northern plantation with Obama as its overseer.

Posted by: texan at April 1, 2009 7:54 AM

I hope the UAW are taking note. The Obama team is not interested in people but government regulation designed to strangle the auto makers. Never thought that I would have sympathy for the UAW but they have been betrayed big time. They sure wasted a lot of time, money and votes on this mirage - turns out the oasis is green CAFE standards.

Posted by: fernstalbert at April 1, 2009 8:42 AM

@Uncle Ken:

Some would be content to repeal the Second Law of Thermodynamics ;)

Posted by: Daniel M. Ryan at April 1, 2009 8:50 AM

Sysyphian ideologies to wit, the crippling government regulations, the unsustainable 'benefits for life' forced by the unions, and the crippling 'cafe standards' by the enviro-nazis sold as the answer to fighting the phony crisis of "climate change" is what has caused the US auto industry to tank. To have a viable auto industry in North America these three 'rocks'... regulations,benefits and standards must be gelded from the most socialistic, nanny state industry on the planet. Only then may it survive. Let the customer decide what will be built, not some political pustule. I love 69 Camaros with modern running gear and F-350 diesel crew cabs.

Posted by: bruce wayne riley at April 1, 2009 9:04 AM

oops, sysyphian ideology

Posted by: bruce wayne riley at April 1, 2009 9:11 AM

So much for letting the consumer decide what type of car they will buy and need with their privately-earned money.

Sir, you have your choice - would you like the mint-green or the lime-green prius?

I read that Hybrid sales have falen off a cliff recently.

Is a single spike in the price of oil, likely driven by an abundance of speculators, along with an increase in CO2 in the atmosphere going to dictate the entire industry?

Talk about an overreaction and recipe to sink the industry. I don't think this is the relevance that Bush was talking about..

Posted by: Beer and Popcorn at April 1, 2009 9:24 AM

Posted by: texan at April 1, 2009 7:54 AM

You are 100% bang-on, texan. Very well-put. The other advantage maobama knows is when you have more than 50% of the voting public on some form of government dole, they will out of necessity vote to keep the largesse-givers in office. Encourage the hardest hitting economic conditions since the depression. Nationalize the banking and auto industries, and any others flailing that could cause "damage" to the economy. Let Elmer Fudd/Barney Fwank set salaries for those assimilated employees. Encourage class warfare between the haves and the have-nots (rather more appropriately, the producers and non-producers). Cripple the well-off businesses through Cardcheck legislation to make it a fait accompli for Tony Soprano & friends to unionize workers (oops - sorry about that, Wal-Mart). Send an inept SecState to pander to the iranians, russians & north koreans, who view her slobbering with scorn, and see the US as weak.

"CHEQUE, PLEASE"


This may be catastrophically bad for the US, requiring a generation or two to undo the damage IF it can be stopped in 2010, never mind 2012. I read yesterday that with the current $trillions of spending, with the projected debt-to-GDP ratio, the US would have difficulty applying for membership in the EU.

Think about that.

What has happened to the American people, who are seeing the systemic destruction of everything they've worked for and achieved in the 233 years? Their demise is presided by a so-called cultured president who fiddles on Leno and 60 Minutes while the country burns. Ahh... but he's a black fiddler, so that's hip, and you're a racist if you object to his policies of self-immolation.

The spinning noises you hear are the Founding Fathers turning in their graves.

mhb23re
at gmail d0t calm

Posted by: mhb at April 1, 2009 9:29 AM

John Fund, writing in the Wall Street Journal:

"The good news is that the Obama administration's task force charged with revamping the auto industry has concluded what many suggested last year before massive taxpayer bailouts. The task force is now saying the best chance for success for both GM and Chrysler "may well require utilizing the bankruptcy code in a quick and surgical way." Now they tell us -- after $22 billion in taxpayer subsidies have been poured into the two companies.

The bad news is that the Obama White House is now clearly deep into industrial policy by forcing out General Motors chief Rick Wagoner and most of his board. Mr. Wagoner, who joined GM in 1977, agreed to leave as one of the White House's conditions for more federal aid. The moves give President Obama political cover as he contemplates just how much taxpayer money to pour into the auto industry.

But the moves also represent another step on the road to the dystopia that Ayn Rand depicted in her novel "Atlas Shrugged." Rand envisioned an America in which bureaucrats dictated terms to both management and labor as it allocated state favors. As Michael Vadum of the Capital Research Center notes, such state managerialism is a peculiarly foreign concept to America. He quotes the Italian dictator Mussolini as saying: "Fascism should more appropriately be called corporatism because it is a merger of state and corporate power." That merger is now underway here, at least until Mr. Obama and his Democrats get through the next couple of elections with the help of a grateful UAW.

Posted by: texan at April 1, 2009 9:30 AM

Dano at April 1, 2009 7:42 AM
Different gallons, Imp vs US
Funny how Volkswagen's always got better mileage in Canada until we switched to liters.

Posted by: G at April 1, 2009 9:48 AM

Beware of Imperial vs. U.S.A. gallons. That 35mpg in the republic translates to 42mpg here in our dominion.

Posted by: M Hawkins at April 1, 2009 9:51 AM

And here's a comment from the Wall Street Journal, by Holman Jenkins, which asks "GM Bankruptcy? Tell Me Another"..the President isn't serious about reform for Detroit".

Here are a few excerpts,

"President Obama rightly says "sacrifices" must be made if GM is to emerge as a viable company. But there's one sacrifice he won't make: his re-election chances, by leaving the fate of the UAW truly up to a bankruptcy judge."

"The GM bailout has become a political operation run out of the White House. It will stay that way."

" Not for him, though, and not for Team Obama, the real solution to make GM "viable": Getting rid of its North American business to end its UAW captivity."

"That captivity, imposed by the 1935 Wagner Act, is the sole relevant factor distinguishing the Detroit Three from the world's other auto makers. The result is downright weird: "Our" auto companies operate in a world that's less "American," in a sense, than the Japanese and German companies that come here and enjoy a free labor market".

"The Wagner world was given a second lease on life by a peculiar feature of Congress's 1975 fuel economy law. Known as the "two fleets" rule, it effectively forces Detroit to make its cheap small cars in high-wage domestic UAW factories, even if it means losing money on every car. The rule has no fuel-economy function. Its only purpose is to shield the UAW monopoly inside each Detroit auto maker from global labor competition."

"Mr. Obama played the tough guy in getting rid of Mr. Wagoner, but he won't go after the labor monopoly. In fact, the union will emerge with a stronger grip on Detroit -- because it will be a major shareholder in a reorganized GM."

In other words
"Mr. Obama will be content with incoherent policies that poll well -- which means GM, Chrysler and perhaps Ford eventually will need taxpayer subsidies as far as the eye can see -- or until a real bankruptcy sometime after November 2012".

What's the Wagner Act? Part of FDR's socialist agenda. The right of workers in private sectors to form unions.

What's the cause of GM's troubles? The unions, the unions, the unions.

Posted by: ET at April 1, 2009 10:05 AM

Next bail out -retail stores.

New gubmint depots in competition with Walmart. direct welfare cheques with a bonus coupon for cashing them at the Obamart. or better yet , a forced takeover of Walmart because doesnt this smack of the enemy of the state.......


Wal-Mart has been criticized by some community groups, women's rights groups, grassroots organizations, and labor unions, specifically for its extensive foreign product sourcing, low rates of employee health insurance enrollment, resistance to union representation, alleged sexism, and even management efforts to pressure employees to vote for specific parties during national elections.

Posted by: cal2 at April 1, 2009 10:11 AM

Wal-Mart has been criticized by ... labor unions [for] ... management efforts to pressure employees to vote for specific parties during national elections.

So I guess it's only OK if the unions exert such pressure.

Posted by: glasnost at April 1, 2009 10:35 AM

my lengthy comment seen here:

http://phantomsoapbox.blogspot.com/2009/03/car-nirvana.html

I'd like to add that while everything ET has said above is true, and the Unions suck every bit as much as she said, there's plenty more wrong with GM than that.

I'm of the opinion that if GM were split back up into Buick, Chevrolet, Pontiac and Cadillac, shorn of the union insanity and turned loose in a regulatory environment that wasn't designed by people who despise America and extra-specially hate cars, we could see some really nice cars coming out of Detroit. Like 300hp out of a 4 cylinder engine, with 40mpg kind of nice. Cars you would want to save up to buy, at prices you could actually save up in your frickin' lifetime.

How is this possible? This is how.

www.hotrod.com/featuredvehicles/hrdp_0904_1967_toyota_powered_chevrolet_camaro/index.html

Did y'all know that you can squeeze 1000 hp put of a straight six Toyota motor with the stock bottom end still in it? Yes friends, bolt on a turbo and go. The block and crank can take it. Stock. Try that with your 350 Chebby motor. Vroom BANG crunch choke.

Mr. Obama is doing here to Detroit what Trudeau did to our health care system all those years ago. The result will be pretty much identical, but much faster because the laws of physics are not known for bending to political pressure.

Reaction from the gearheads will be implacable once they figure out what's been done. Bary just kicked something I think he might not want woken up, you ask me.

Posted by: The Phantom at April 1, 2009 11:11 AM

ulianov; You're operating under the false premise that we have to pay something. We don't.

Posted by: Richard Evans at April 1, 2009 11:21 AM

From up top by EBD:

"The definition of an idiot is someone who believes his ideas will change the world. Now, to be clear, I'm not talking about someone who believes that his ideas might someday spread and become widely-held, I'm talking about someone who believes that his ideas can be imposed, by edict, on the world at large, in the face of the....you know, the world at large."

I wish I'd said that. Spot on.

Posted by: bobdog at April 1, 2009 11:36 AM

They are doing this on purpose. It is part of the destruction of America as we know it.

America is on it's way to becoming a socialist state with a heavy thug factor keeping people in line on the streets VIA ACORN's growing military wing.

Americans will need to learn to love dangerous and unreliable public transit to get to their government work stations.

Maybe I am wrong, maybe they are just as stupid as they appear to be and I am reading too much into it.

Posted by: Momar at April 1, 2009 11:40 AM

This is a mouthful, but read it carefully:

"Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber barons than under omnipotent moral busybodies. The robber baron's cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience."
CS Lewis

Posted by: bobdog at April 1, 2009 11:41 AM

Momar, I agree with you that they are doing it on purpose, and the purpose is to MAKE Americans buy what they SHOULD be buying, according to the "smart" people. Beyond that, I doubt they've given a second's thought to the consequences.

They just want to make sure everybody is doing what they are supposed to be doing, and the Democrat way to do that is to centralize control, centralize access to resources, and hand them out to the deserving in an equitable way. Then the noble, educated and fair people can be CERTAIN that nobody is getting more than somebody else. Its all fair, see?

It seems so reasonable when you say it that way, doesn't it?

Posted by: The Phantom at April 1, 2009 11:50 AM

"buy north american, buy north american" bla bla bla.

uhuh. and show me ANY 'north american' vehicle ENTIRELY designed and built, AND the machine tools all designed and built in north america.

and then I will show you a million auto workers that hitail off the walmart where they buy all those electronic toys made in China.

detoilet is getting precisely what they deserve for decades of 'planned obsolescence' (remember that phrase?) and unfettered greed.

Posted by: wheelerdealers at April 1, 2009 11:56 AM

phantom - I completely agree with you about splitting up the megathorn that is GM into smaller, product-specific companies - and, shorn of the union parastic leeching - that these companies would prosper. But the unions won't let this happen.

What the unions have done is to remove the focus of the company from making competitive products, to servicing the increasing demands of its employees. The product disappears completely. The focus is only on the welfare of the employees.

So, you get higher wages, far beyond any reasonable allocation for actual work done; you get lifetime tenure; no firing; no lay-offs; no reviews for incompetence, for no-shows, for 'every Friday and Monday off sick' (a common practice in our civil service). You get the union dividing up work into 'bits', with a requirement for a fulltime worker for each bit, tripling and quadrupling your worker numbers.

You get the company being force to move its profits into company funded health care, education benefits, enormous pensions, vacations, sickdays and etc.

There's no money for the product. None. No research and development of the product, no better equipment, no advanced technology. And no ability to be competitive because the costs of sustaining this enormous workforce requirement is far beyond any profit's capacity.

Unions are parasites.

Posted by: ET at April 1, 2009 12:00 PM

Hey ET - you beginning to look stupid. The union is only part of the problem. Fleet sales is one leech that seems to be completely off of your unastute radar.

You really are suffering from severe tunnel vision!

Posted by: the bear at April 1, 2009 12:39 PM

ET, as currently constituted the unions will indeed behave as you say. The union management is composed of men who respond to nothing other than main force, if that. They're in it for what they can get out of it, period.

The -membership- is a different matter. A union is nothing without members, just an empty shell. If the UAW calls a demonstration and one bus load shows up, they can whinge all they want and it will avail them naught.

The way to crack the unions is to speak directly to the members. If members think their union is going to bring them personally to ruin, and they obviously are, then the members will take steps.

I maintain that people aren't stupid, not even union members. Ignorant, that they certainly seem to be. But, if presented with the fact that their union is selling them down the river , they will act intelligently.

Posted by: The Phantom at April 1, 2009 12:42 PM

In the aggregate, in the fullness of time, you canot force the market to pay above market-clearing prices and you cannot get higher wages without a proportionate increase in productivity per worker. Period.

Posted by: Me No Dhimmi at April 1, 2009 12:53 PM

bear, in ET's defense she's not exactly a gear head.

From what you're saying, GM could have carried the union freight farther if the management wasn't blinkered and bound by inefficient policy. It will be interesting to see how long it takes the new Government Motors to come up with even more imbecilic policy.

I forsee a return to the classic Trabant design, myself. Complete with cardboard doors and Masonite floors. Government CAFE testing apparatus will be "adjusted" to give the proper mileage/pollution readings from the oil puking two strokes they'll be using.

Crash safety tests should be interesting.

Posted by: The Phantom at April 1, 2009 12:58 PM

I have heard of Oldsmobile. This is a description of the Government Motors Obambamobile.

http://pajamasmedia.com/blog/government-motors-gm-unveils-its-first-model/

Posted by: Speedy at April 1, 2009 1:01 PM

No Phantom I think the unions need to be put in their place but ET's infatuation with unions being the entire problem with the big 3 is 100% misguided. Management has some serious issues and they are only to happy to point the finger in the other direction.

Posted by: the bear at April 1, 2009 1:12 PM

"What has happened to the American people, who are seeing the systemic destruction of everything they've worked for and achieved in the 233 years? Their demise is presided by a so-called cultured president who fiddles on Leno and 60 Minutes while the country burns. Ahh... but he's a black fiddler, so that's hip, and you're a racist if you object to his policies of self-immolation."

Agreed.

“ So this is how liberty dies… with thunderous applause” -Star Wars epIII

Posted by: Indiana Homez at April 1, 2009 1:56 PM

me no dhimmi - of course you can increase wages without a proportionate increase in productivity per worker. That's how unions function; they increase wages and decrease productivity. An example is our civil service.

You can indeed say that ..in the long run..this strategy won't function. But in the public civil service it will, because the govt simply increases taxes to pay for these increased costs. Lower productivity is explained away with all the deftness of an Obama-like rhetoric. And if the public grumbles..so? In Ontario and Toronto, house taxes have increased; car registration has doubled (yes); they've added new taxes (waste pickup)..and they'll think of some more.

And these charges ARE 'above-market' clearing prices. But the govt operates as a monopoly. Your scenario requires NO MONOPOLIES. But the govt operates as a monopoly. You can't get water, hydro, car licenses, housing permits from other sources. In Toronto, if you want to use private garbage pick-up for recycling, the City will then refuse to pick up garbage, etc.

At one time, we used to get postal delivery twice a day and once on Saturday; and for less costs. Now, you can mail a letter in Toronto and it will take two weeks to get to Montreal. And, it is interesting, but our postman is frequently (cough) ill ..on Fridays. Heh.

Bear - if the costs of production are higher than the returns in profit, then, this is a simple arithmetic fact. It has nothing to do with 'tunnel vision'. Furthermore, if the major reason for high costs are high worker costs caused by and only by, the unions, I feel quite justified in assigning blame to the unions. Unions are parasites and have no place in our modern economy.

phantom - I think that the thug-tactics of the unions will frighten people against complaining about and fighting against the unions. The thugs in the union would never allow only one busload, for example. You'd better be on that bus or they'll make trouble for you at work; they'll harass you..and etc. Unions don't operate by human rights rules.

Bear - provide some proof that fleet sales is a key factor in the demise of GM. Thanks. Remember, that the construction of such specialized trucks and cars is still based on those union wages; unionized 'bit' jobs which require multiple workers rather than one; union benefits and etc.

Posted by: ET at April 1, 2009 3:34 PM

ET: Of course I know that. What I meant was the economy as a whole, in the aggregate. The wages in the aggregate across the economy cannot be sustained at a level above productivity. In other words, what the union members GET in above-market values are eventually LOST trough business failure or through new non-union ventures (think of couriers vs. postal service); when union members are paid above-market their "gains" are balanced out by future losses through business failure. In this sense, there is a zero-sum dynamic at play here.

Unions in fact are NOT "for the workers". They're for a small subset of workers, namely union members, whom we mustn't equate with "the workers".

the bear is right up to a point. It's not entirely the unions' fault; it's the fault of cowardly, craven government legislation which gives wholly inappropriate powers to unions, powers not permitted to ordinary citizens. No politician seems to have the guts to correct this injustice. I doubt that the bear will find my observation any the more comforting.

One simple example: sure, have your collective bargaining rights, your collective strike action. HOWEVER, unions should NOT be allowed to prohibit the use of replacement workers. That is a clear violation of the right of association. It also removes any kind of economic discipline upon the members.

Posted by: Me No Dhimmi at April 1, 2009 4:15 PM

me no dhimmi - yes, I get your point about 'in the long run'...but, governments..and people..haven't stood up to unions. It isn't simply up to governments to reject unions; it's up to people to reject them.

But, still, again and again, the unions try to get shops unionized..and people go along with it! Think about the Wal-Mart in Quebec.

And, as you point out, in the long run, and this is a long run...unions are viciously destructive to the economy. But, people..not in govt..just everyday people..don't live 'in the long run'. They focus on the utopian NOW promises of extreme gain - high wages, zillions of benefits all paid by The Greedy Employer, early retirement with fat pensions..and so on. That's as far 'in the long run' that they see.
And when the company can't keep up running itself as a Spa-For-Workers...and collapses, then, these same workers AND THE UNION...insist that the government, i.e., you and everyone else, take up the Role of the Employer..and Keep the Spa Running. For those unionized workers. Just for them.

I'm aware that the unionized workers are not the same as the non-union ones. I'm only talking about unions here.

I don't think that it is a 'cowardly craven government' vs the union. I think that unions should be outlawed. Totally outlawed. They are parasites on the workers and the consumers, driving up prices, setting up elite workers and degrading the products made by these companies since no money is spent on the products. It all goes to the Workers.

When you think of the tactics of Unions, you realize that it's not easy to get rid of them. First, they deliberately set up monopolies of control. You can see this in transportation. Eg, the TTC, which goes on strike and holds the citizens of Toronto hostage because NO other transit system is allowed in a city other than a unionized one.
How about teachers? Same thing. Unionized; they go on strike and hold the students hostage.
How about health care and police..ahh..they aren't allowed to strike. Good. But their wages shouldn't be determined by a monopoly-union.

How about the Post office? They can strike.

How about a private company..such as GM..where the union moved in to take over the whole company such that if it went on strike, it crippled the industry.

I don't see the point of replacement workers in a strike, for the whole point of the strike is to stop production. Those replacement workers would be beaten up by the union thugs if they even walked up to the plant.

I see no point in unions in a modern world, when most of the worker-benefits and health issues have been taken over by the govt. These modern unions, which are parasites, exist now to keep a secondary group, the Union executives, paid and employed. After all...the union executive are paid out of the dues of the workers! What work do they do...other than demanding more and more and more. Which drives up the costs more and more and more. And then..the company collapses because the focus has switched from The Product to THE SPA FOR WORKERS.

Posted by: ET at April 1, 2009 4:29 PM

Just to make sure you understand we're on the same page ET. Without question, the domestic auto industry has been destroyed by the unions' success in attaining above-market-clearing prices for it's labour, an advantage that cannot be maintained indefinitely.

Clearly the foreign auto companies have fared better in the US because they are non-unionized and are not subject to regulation, putatively for other purposes, but at base designed to help the unions.

If I understand economics at all, I think it's fair to say that, in the long run, and in real terms, unions cannot improve the lot of the worker over and above the rate of improvement in productivity. Even when it appears to get above-market gains, these will be neutralized by future inflation, and of course by loss of employment from business failure.

Posted by: Me No Dhimmi at April 1, 2009 4:31 PM

[quote]These modern unions, which are parasites, exist now to keep a secondary group, the Union executives, paid and employed.[/quote]

ET,
Now you are getting Close... Both the union & MANAGEMENT have unnecessary parasites. It is these Pll that need to be eliminated in a GM bankruptcy. For every parasite the Union has the Management has a counter parasite. Dung Bug for Dung Bug. The Bankruptcy will also lead to criminal charges (like Enron) for misuse of Company money. This is Detroit after all…. Some want, real bad, to keep the books closed.

The Union workers that are trained tradesmen are not the people getting shafted, they are in high demand and can re-enter the work force with ease. This is not about them as they are the creators of Corporate wealth.

The Obama green job task force (Wind Power) identified tradesmen, welders etc as those most desired. They also identified Program Managers (that's plural). It would not be unusual to have 3 Managers per Welder/Trades person, and the sleaze builds from there

The silence of the legal community is deafening, the CEO is fired not by the shareholders, but by a corrupt political system. What kind of stupid people think that the Stock Market will rebound if shareholders lack legal standing? Who buys phony Stock? The optics, if one is looking, suggests that the market is one big fraudulent Ponzi scheme. I think the NYC street Shell Game has better odds, and I know that the art of the game is in the removal of the pea.

Posted by: Phillip G. Shaw at April 1, 2009 6:16 PM

Phase II: O's fascist-corporate State consolidates its deathgrip/chokehold on the "storied American manufacturer".
...-

"U.S. Plans Key Role In Naming GM Board

The Obama administration will play a key role in reshaping General Motors' board of directors over the next six months, potentially giving it even greater control in the management of the storied American manufacturer."
http://www.freerepublic.com/focus/f-news/2220231/posts

Posted by: maz2 at April 1, 2009 8:04 PM

Specialized? WTF is so specialized about a pick up sold below cost. JHC! You're a stubborn one. Labour only makes up 15% of the cost!

Are you LISTENING ET! You're beginning to sound like a frickin' leftard. All blast and no reasoning!

Well have at 'er ET! Give Obama a call and let him know you have all the solutions. Fire the workers and hire them back @ $12/hour and tell 'em to suck it up.

Hope you do the same for the salaried employees who never seem to be around when we call, totally missing on Friday afternoon and Monday morning! Or gone for 4 weeks of their 6 weeks of vacation time. When they do show up at the dealership, they come floating into the dealership driving a $72,000 Escalade or $65,000 Denali since an Impala just seems to be beneath their position.

Yeah, it's all the unions fault. Salaried employees aren't guilty of anything.

Posted by: the bear at April 1, 2009 8:29 PM

the bear - I don't debate with people who move into personal insults and course language. Stick to the issues.

The costs of car production must include not simply the actual wages but also all benefits. AND also the costs to the company of retiree pensions etc. You are focusing only on the costs to make a car; I am focusing on the company's costs to make cars. This latter focus therefore includes all employee, both current and retired, costs. After all, the profits have to go to both sets! And this total is far beyond the ratio of 15%.

By specialized I mean trucks and cars geared to a particular company; this can include those special prices. Kindly watch your language.

Salaried employees, by the way, can also belong to a union. Ever heard of the Public Service Unions? The teacher's Union? These all deal with salaried employment - not hourly.

No, I don't blame the 'salaried employees' of the dealerships for the demise of the Big 3 auto companies. They are a small percentage. I blame the unions and their transformation of industrial production to a Spa For Workers.

Posted by: ET at April 1, 2009 8:57 PM

Reminds me of the Soviets five year plans that they had no hope in hell of achieving. No doubt Obama is one of those types who think oil companies & car manufactures have been buying off fuel efficient engines from people, if not murdering them for 70 years. That run off water. Hiding them all for oil Baron reasons.
Lets call this: “The year of Stalin‘s rise“.
JMO

Posted by: Revnant Dream at April 1, 2009 9:01 PM

Seems to me that nobody is banning unions but the market is establishing that, where one exists, there is no longer a business case for the underlying business.

In the future unions will have one and only one home. Two words.

Public-service.

Posted by: Beer and Popcorn at April 1, 2009 10:15 PM

ulianov - your post is filled with naive remarks.

Banning unions isn't a sign of fascism! Fascism is a particular mode of political organization, utopian, centralist, authoritarian, based around a belief in the NATION as an essentialist force. Individuals in such a political mode don't exist because the focus is on the group. And the group is an expression of 'the nation'. So, banning unions in a fascist state is because there can only be one group - the national identity. There's no need for unions because everyone is already in a group - the national identity.

Same thing in communist societies. The difference in a communist society is that the group is not the national or 'ethnic identity' but the worker. There's no need for unions because everyone is already in a group - the Communist Party which operates as a 'union'.

And the Polish Solidarity wasn't a traditional union; it wasn't a work or factory or workplace related movement. It was a political movement against the communists. Please try to get your facts clear, ulianov.

And again, brush up on the definition of fascism. It has nothing to do with banning unions but with banning associations not under the authority of the state.

Unions are parasites. They have no functional role in the modern economy and ought to be banned. Cheers, ulianov/lberia.

Posted by: ET at April 1, 2009 10:32 PM

ulianov - again, clear up your definitions. The term 'fascist', if used correctly has to refer to someone who operates within 'fascism', the political ideology. That's why the two terms are semantically related; the fascist believes in fascism. Get it?

To use it ONLY to mean 'authoritarian' etc (rather than using the term 'authoritarian' and NOT to also refer it to the political ideology of fascism, is a misuse of the word.

So, if you mean 'authoritarian' or 'dictatorial'..without adding the ideology of fascism, then, just use those words. Don't use 'fascist'. Try to use words correctly, OK?

No, Solidarity was a political movement. The fact that it was first located in the Gdansk shipyard workers doesn't mean that its agenda was to deal with negotiations between the workers and the employers, with setting wages, vacations, benefits, etc, etc. It was none of this. It was a political movement. Period.

And no, I don't agree that unions - which are associations geared to promoting wages, benefits etc of workers of specific companies and industries - ought to be involved in political issues. I believe that the individual worker has the right to make up his own mind about political issues and the union has no right to speak for him.

And don't be a twit - I've never advocated forcible suppression of opposition.
Again, ulianov/lberia - try again. This time, get your facts and definitions straight.

Posted by: ET at April 1, 2009 11:13 PM

a number was bandied about a ways back.

$2000 of the purchase price of a GM vehicle going towards retired workers pensions.

don't have that problem with import cars, they haven't been around in huge numbers long enough.

thus, buy Honda, Nissan, Hyundai, etc and the 2 grand goes to additional features and options.

someone needs some math lessons.

Posted by: CAW wannabe at April 2, 2009 12:24 PM
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