News circulates on the right wing quickly, and when something is said that is not true or oversimplified, it appears here, there, and everywhere, repeated uncritically. I’m talking about the $70 per hour figure that is routinely reported as wages paid UAW auto workers by Ford, GM, and Chrysler.
First, the number does not represent actual wages paid these employees – rather, it is a number arrived at by combining current wages, pension and health benefits for all of the auto companies’ employees, past (legacy) and present. Fair enough. But a more honest way of saying that would be that auto workers have to produce $70 per hour to maintain the current load of wages, benefits, and legacy costs.
But the number isn’t used that way. The right wing is far more dishonest – they are making it seem as though fat and lazy auto workers are taking home that much in pay. They don’t often delve into detail. The result is a deliberate propagation of a myth designed to hurt the UAW, and unions in general. That’s how the right wing functions.
But there’s more to it than that. They also make it seem like the Big Three have been unrealistic in its past dealings with UAW, and made commitments it could not possibly sustain. That is part of a general dislike of labor organizations in general. It is the culture on the right wing. But there are a couple of things to consider here.
First, the $70 figure for GM is a compendium of all labor costs, current, and 432,000 retirees. (I have not been able to determine whether those retirees are UAW legacy or all of GM’s legacy. Anyone know?) (Effective January 1, 2009, 100,000 GM white collar retirees will no longer receive health benefits.) Those who are batting this figure about are leaving the impression that it is current UAW workers to blame, and no one else.
Secondly, what exactly is the blame? In 1962, for example, General Motors had 605,000 employees. In 2008, they have 266,000. Twenty years ago, they had about 107,000 American line workers – today, after a buyout of 19,000, they are down to about 54,000.
That’s the key to the $70 figure – GM’s current shrunken work force is carrying the load for past employees who existed in far greater numbers. Far from being responsible, far from the moaning and whining about irresponsible labor contracts, we’re dealing with a simple contraction. Current average UAW workers costs about $26 $40 per hour, $55 with benefits (according to NY Times – I read $28 baseline elsewhere) per hour, and new hires are coming in at $14 plus reduced benefits.
The American auto companies are faced with stiff, non-union competition, including cheap labor in other parts of the world – globalization, aka, the race to the bottom, economic efficiency – whatever you want to call it. The idea that a worker can support a family, have health care coverage and a pension is passé. The “free market” won’t allow it.
That’s the right wing – sacrifice all for those supposed “free” markets – even as those markets destroy the very things we believe in. Don’t interfere with markets, accept market outcomes as the only viable outcome, don’t protect jobs or cities or towns ….
Don’t protect industries. The economy doesn’t exist for our benefit. We exist for the economy. It appears at this time that the Republicans in the United States Senate are going to filibuster a bill that would allow a temporary fix to General Motors and Chrysler. The bill would divert $15 billion of already-appropriated money to stop the bleeding while a longer-term survival package is designed. The longer term package would hopefully address the legacy problem. It would save jobs, communities, and hundreds of thousands, if not millions of people who depend on the auto industry. It would be a bailout. A much-needed bailout of an industry in trouble. One that has served us well for a century.
They don’t care. They are pissed about the UAW, they want it gone. They don’t like it when workers organize – it runs contrary to their strongly-held beliefs. When markets dictate that a company suffers from inefficiency or failure to anticipate market trends or simple management stupidity, that company must pay the market price. General Motors doesn’t need to exist, the jobs will reappear in other forms (for less pay).
Unless, of course, you are Citibank, AIG, Merrill Lynch or the host of other financial institutions what screwed up and are being bailed out, no questions asked, bonuses and new acquisitions ignored, no questions about wage levels.
It is utterly contemptible hypocrisy.
Addendum It bears repeating here that the major competitor to the Big Three, Toyota, would not exist were it not for government subsidy and protection.
Piece of Mindful 
When you say, “The American auto companies are aced with stiff, non-union competition” , you must surely mean the south. Like the new VW plant in TN, Toyota in MS, Kia in GA, Nissan in Nashville, BMW in SC, Mercedes in AL, and finally Honda in NB. Now they’re other American car plants in the south, who are doing fine, I just didn’t look them up.
As long as we’re comparing the $70’s/ hr with the southern $40’s/hr shouldn’t also compare the low state tax rates (both personal and business) and the cost of living in both areas?
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You are talking about the companies, that is, the bottom line, or investors. You’re not talking about workers. They are not unionized. Thye are not doing as well as their northern counterparts. I repeat – contempt for workers.
And, of course, you’re talking about low corporate tax rates, as if they should not be burdened.
You’re a typical Republican, aligned with the wealthy against your own interest.
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I own two American truck/cars, which were built in Michigan. Where do your cars hale from?
Oh, I just read a great break down of the $70/hr jobs in the NYT. I’ll link in the next comment, so my question won’t get screened out.
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NYT link, make sure you review the graph.
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When I get the chance, I buy a GM car. At the moment I’m in a Ford.
I don’t see where anyone has been anti-labor on this board. You like to launch into a sermon on the subject when you get the chance. Must be all that Catholic training.
John Deere and Caterpillar are UAW companies and they are doing well. No one that I know of complains about them. On the other hand, International Harvester tractors are no more, in part due to the tactics of the UAW. Unions aren’t all good. They have their problems. I think we should be honest about it. Workers somewhere in the economy have to do some productive work to make things go ’round. The big three’s union problems are just more apparent now that things are not so grand.
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Good link, Swede. Thanks.
Go to Swede’s link right above your comment, Fred. Republicans are using this opportunity to bash unions, but the problems go much deeper.
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Mark…thanks for the best post I’ve read on the issue. As the son of a 30 year autoworker, I watched my dad work his fingers to the bone on shifts that ran day and night. He and my mom both worked, saved and longed for the day of retirement. He drove 80 miles round trip for that job through rain, sleet and snow. In the last month of his last year, he dropped to the ground outside our house from a heart attack. He did not die until later and was able to secure his pension for my mom.
Today, I heard a republican senator say the UAW has not given enough. The legacy workers and their spouses need to give up the “bloated benefits” and pull in their purse strings. Is he nuts? Are all of you naysayers nuts? My mom is not living like a queen…far from it. Yes, she has health care and gets a check each month…..but that is something both my father, and through our families sacrifices when my dad worked overtime, holidays, etc. that my mother also earned. She should not be ashamed of that money or those benefits.
Why in the world would a senator who will get EXTENSIVE benefits and a BLOATED salary demand that retired blue collar workers and their spouses give the money back. Money they worked hard for their whole lives and were promised. Money and benefits they also paid union dues, and time and effort they gave to their employer to protect.
I know someone who works for Toyota who couldn’t stop hassling my family about how lazy UAW workers are and that they all deserve to lose everything and that Toyota treats its non-union workers right.
Well, last week he got a pink slip. See ya. 15 years – no benefits, no extended pay to find a job, no job assistance, no pension, no nothing. Just, see ya later. His laughing and condescending tone are now gone. He’s desperate to find a job to support his family. Welcome to the new America buddy. One that has little respect for those that bust their hump to keep the economy humming.
Meanwhile, the AIG folks and others are getting their nails polished at spas with taxpayers money. We’ve lost our way people and for those of you who think you know it all, you may want to look in the mirror. Unless you’re among the very wealthy who think this country owes them everything, you may be the next one in line to lose your job.
Support the autoworker’s loan request. It’s time to help the men and women who take showers at night when they come home, instead of the ones who do in the morning before they go to work!
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Thanks, Proud Son – if I had had my thinking cap on frontwards when I wrote this, I would have thought to mention bloated benefits for Senators.
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Both you guys are trashing Toyota, must mean you’re driving a Honda.
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I haven’t trashed Toyota. I just stated what is known – Toyota survived in large part by government subsidy and protective tariffs, neither of which it has or needs anymore.
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I really think it’s anti-labor, anti-worker sentiment at the root of manufacturing’s anti-union talk. Unions are, of course, at the top of the hit list, but if there were no unions the pressure to lower wages would not end. These same companies oppose hiking minimum wage, and offshore whenever it suits their bottom line. All have foreign plants making cars and trucks that would sell profitably here in the U.S. If lavish tax deductions for SUVs and 3/4 ton trucks were lifted they’d have all been gone years ago.
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Not that he needs me to defend him, but Gregg was, correctly, quite outspoken (just one example) against the earlier bailouts.
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I drive a Subaru, my wife drives another. I don’t apologize. I’d rather have Japan making cars than tanks.
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