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Does the UAW owe taxpayers a thank you? Chrysler’s attempts at thanking the taxpayers in the midst of bailout-mania seemed to draw more ire than respect, so it’s understandable why the UAW has not made any effort to thank taxpayers for the auto bailout, without which the union surely would not have survived long. But now that UAW local 1268 has made a somewhat belated, but nonetheless earnest gesture of thanks, the national UAW’s silence on the matter suddenly seems a bit deafening.
33 Comments on “A Salute To The American Taxpayer, From The United Auto Workers (Local 1268)...”
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Chrysler earned that ire by paying for expensive ad real estate with bailout money. It looked bad. Really bad.
This video does not come across that way. In fact, as a guy who dislikes unions, I think they did a good job at just saying thank you.
Does anybody really care anymore? Other that on this site, I can’t think of anybody who is still grousing over the bsilouts. In fact, far and away I hear much more anger against the financial institutions as they are going back to the old ways and aren’t even making any apologies about it. In fact they sound like they are entitled to it. So, IMHO the lack of any real response from the UAW is a non issue.
Why would the UAW say thank you?
They think the bail-out is an entitlement of a modern, progressive economy where appointed Czars and government committees supplant the messy market.
The bail-out saved an important Democrat political constituency and the auto companies happened to be included in the deal.
They think the bail-out is an entitlement of a modern, progressive economy where appointed Czars and government committees supplant the messy market.
This has ALWAYS been true and isn’t new to this administration. Even the rights hero of ‘Free Markets’ Reagan had one of the most protectionist and pro state intervention administrations of the post war period. There isn’t a single true free market that exists in the world today and I would hazard to say it can’t exist. Free Markets only exist in textbooks and economics classrooms.
Socialism for the rich, free markets for the rest.
You’re falling into a typical trap here – instead of arguing whether the intervention is good for the country, you are simply saying that “everybody does it” (which is true) and therefore using this to imply that it is good for the country. Sorry, doesn’t work that way.
The bottom line is that these interventions end up hurting both customers and the economy in the long run. You are right that President Reagan interevened in the domestic auto market in the early 1980s, when his administration pressured the Japanese government to sign a “voluntary restraint agreement” that limited the number of Japanese vehicles that could be imported into this country. This was to give the Big Three some “breathing room.”
What it didn’t do was dampen the customer desire for Japanese cars, which were superior to their domestic counterparts at that time. Customers were willing to pay more than the sticker price for Japanese cars (which increased their prestige), as they became harder to buy. The domestics, meanwhile, used that price umbrella to increase THEIR prices. This did help profits, which encouraged management to start handing out million-dollar bonuses, and the UAW to demand more wages and benefits.
The real harm, though, was that it encouraged the Japanese to move upmarket. If they risked limits being imposed on what they could sell in this country, they decided to sell vehicles with higher profit margins. Hence, the introduction of Lexus, Acura and Infiniti, which, in many ways, was a serious blow to Cadillac, Lincoln, Buick and Oldsmobile.
Management and the UAW, meanwhile, reverted back to their bad old habits, which meant that the industry was in trouble again by 1990. The light truck boom of the 1990s, led by the Ford Explorer and Jeep Grand Cherokee, masked the uncompetitive position of the domestics in passenger cars – particularly in subcompact and compact cars. But the UAW and management had little, if any, incentive to change their behavior, or the policies, that made GM, Ford and Chrysler uncompetitive in the first place.
We could have avoided a lot of the grief of the last 5-6 years if management and the UAW had made some hard choices in the 1980s. But the desire to shield them from their own incompetence, in the name of “preserving American industry” (regardless of whether all members of such a largely inept sector deserved to be saved in the first place), prevented this from happening.
geeber,
I didn’t mean it to sound like I am in favor of the bailouts, just that they happen all the time in almost every industry and many on the right simply ignore this when it suites their political argument. The constituents have always been monied interests. Placating the UAW was only done to alow the wealthy to continue to get their share of the public monies. We have ONE political party in the U.S. with two factions, the business party. Because of slighty different interests, the poor and middle class do better under democrats but their interests are not being served directly regardless.
The broken record that laissez faire will fix everything and that unions destroy every industry is growing tiresome and has proven to be fantastical mental masturbation. It’s not the UAW, or yes, even the government that is the enemy here, it is corporatism that is destroying the middle class. The government is simply being bought by monied interests, that can be changed, the governance of corporations cannot.
Yeah, of course it also saved GM, Ford, Chrysler, the entire US automotive infrastructure, and probably prevented a real depression in the Midwest – you know, hundreds of thousands of jobs lost. But I guess right wingers would have preferred that to removing the ideological rod they keep shoved up inside themselves.
Unless GM, Ford and Chyrsler all collapsed on the same Tuesday, the remaining U.S. car makers would have to increase production including the transplants. If Chrysler collapsed first, would their dedicated buyers drive their old cars into the ground and then take the bus? Only the strong survive, right? Not all jobs would be saved but I think many jobs were lost during the restructuring anyways. Haven’t most industries taken a blow? Haven’t many of us, still employed, taken a pay cut or had to move to follow a job? I’ve done both.
Yeah, of course it also saved GM, Ford, Chrysler, the entire US automotive infrastructure, and probably prevented a real depression in the Midwest – you know, hundreds of thousands of jobs lost. But I guess right wingers would have preferred that to removing the ideological rod they keep shoved up inside themselves.
Har, har. Taking the rhetoric and emotions out of this, the example you cite (which DenverMike quite correctly refutes with cold, simple logic) doesn’t matter one whit… unless we all admit GM and Fiasler aren’t automakers, so much as they are jobs programs for the UAW.
Both companies failed as automakers. They were saved as jobs programs. Nothing “ideological” about that.
shiney2: Yeah, of course it also saved GM, Ford, Chrysler, the entire US automotive infrastructure, and probably prevented a real depression in the Midwest – you know, hundreds of thousands of jobs lost.
Except, of course, that the demand for cars in this country would not have disappeared, so other manufacturers would have eventually stepped in to fill the gap. But I guess that only GM and Chrysler knew how to build a car – although, based on their products, that is certainly a debatable proposition. If they had disappeared completely (which wouldn’t have happened, but I realize that ignoring reality is easier), no one would have ever been able to figure out how to design, engineer and build a new vehicle in this country ever again.
Of course, those cars wouldn’t have necessarily been built by UAW members, which is the real rub here.
If you really think that this is over, and there is a guarantee that it will have no nasty side effects in the future, I’d suggest that you learn what happened in the wake of the Reagan Administration’s attempt to protect the Big Three with “voluntary import restraints” against Japanese cars in the 1980s.
shiney2: But I guess right wingers would have preferred that to removing the ideological rod they keep shoved up inside themselves.
Yes, and when those on the left who ran around denouncing corporate welfare for the past 30 years voice their support for one of the biggest corporate welfare handouts in history, it’s not hypocritical at all.
And the UAW certainly isn’t a special interest at all, and really does represent middle-class car buyers and have their best interests at heart.
If you believe that, it might be helpful to join the rest of us in the real world.
@DenverMike, Rob & Geeber
While I agree it could have been stated less confrontationally, each of you are indulging in a little Reductio ad absurdum and deliberately oversimplifying (and mischaractering) his argument. He’s not saying, as you well know, that GM and Chrysler has to survive, but that the supply chain damage from major suppliers failing as a result of their failure (and they would likely have failed, given the credit crunch and the dearth of buyers).
Yes, things would have recovered. Eventually. But when, to what level and how long the interrgunum would have been is far from certain and likely worse than you’d like to think.
Toyota, Honda and Hyundai were lobbying for bailouts for the D3 for this very reason: they knew that a) their own supply chains were at risk, and b) that the greater economy would have been in trouble of tens (or hundreds) thousands of middle class customers were thrown out of work. When those very competitors whom you say would ostensibly have benefitted were in fact arguing for a bailout not for themselves or their suppliers, but for the competition, it should tell you something about how tenuous the situation really was.
It also should tell you that people in industry had some insight and practical wisdom, and should perhaps be listened to and given credence, rather than people with an ideological bent who see laissez faire as the answer to every problem
If the concern is preserving the supply chain, then give the federal money directly to the suppliers to tide them over until the everything shakes out. It would have been cheaper and not shielded GM, Chrysler and the UAW from the ultimate result of their own incompetence.
And I’m not impressed at all with the fact that the transplants were lobbying in favor of the bailout. That is called covering their butts, not engaging in rational analysis or using “practical wisdom.” I can discern a PR-driven position quite easily…and, let’s face it, it wasn’t THEIR money used for the bailouts.
The heads of those companies realized that the UAW, management, their allies in Congress and the “Buy American” hysterics would have blamed them for what happened, even though it was not their fault. Unless, by “their fault” we mean, “had the gall to provide American customers with products superior to the ones manufactured by GM and Chrysler.”
Psar,
For your argument to have teeth, wouldn’t the D3 have to die simultaneously? If Chrysler died, wouldn’t Ford & GM have to increase production? Wouldn’t that require extra hands? Don’t the D3 have shared parts suppliers? Some would die, some would get stronger, some are in third world countries and others are soon to be. Yes some domestic sales would be lost to pure imports but don’t forget all the domestic loyalists including the feds, municipalities, utilities and companies like Verizon and Union Pacific that will continue to buy domestic makes regardless.
You’re right – it draws more ire! Everyone I emailed this link to, mostly guys in their sixties, are pissed. And, yes, there still are a lot of people who actually care about the bail outs, hand outs and nationalization. At least with the financial institutions there is a better chance of getting all that money back, with interest, but with the US auto industry? Not so much.
And to those national socialists among us who believe that tax payers should bail out failed entities and companies I say, you better hope this will never happen to you. The government won’t bail you out when you need it. Your government will let you go tits up.
This was a purely selective decision by two presidents, based on faulty logic, that bailed out a US industry that doesn’t stand a snow ball’s chance in hell of making it on its own merits. All that was accomplished is that the government delayed the inevitable by a few years, and future failures, mergers and liquidations are still on the horizon. All at a terrible expense to the tax payers of America. The clear winners? The UAW. They got to keep their rich bennies. What do we tax payers have to show for it? Grief.
What do you think Sergio is going to do when he gets his 51% of Chrysler? He’s going to move a ton of Fiatsler jobs out of the US to more promising markets where they can actually make some money.
Actually as much as I loathe the GM bailout, the taxpayers have lost and will lose much more on the financial bailouts. In fact, I am too kazy to look up numbers but it will be much more and it is still ongoing. Bailing out the banks haas never stopped since 2008 and probably can’t stop without a complete financial collapse. That will happen anyway bu the Fed will keep on dancing as fast as it can until the game finally ends and it can’t end well.
MikeAR, it could turn out that you are right. I honestly don’t know because there are so many contributing factors in flux right now. But if I were a betting man, I would bet on the international financial industry to succeed before I would bet one centavo on the US auto industry. They didn’t succeed at anything but financial collapse over the past forty years.
Don’t misunderstand. I drove Detroit all my life until we bought our current crop of vehicles. But in view of the current situation in the global auto market place I do not see any future beyond 2014/2015 for Ford and GM. Neither can sustain themselves if they are forced to pick up the tab for their own operations and have to pay back the money they owe. More than likely what will happen is that Congress will forgive their debts to the Treasury and sanction a sale to a foreign auto manufacturer (a la Chrysler to Fiat).
Bailing out the UAW at tax payers’ expense was just plain bad karma, bad precedent, bad everything. Let’s not forget that we, the people, are also on the hook through PBGC to pay the UAW retirees all their rich benefits. You know, that is also tax payer money since the UAW never contributed any money to the PBGC as an insurance to keep them solvent.
Cat, I’m don’t have time to search for the numbers now but just off the top of my head, the financial industry bailouts were larger and the banks that received them are still by any hinest standards still insolvent. You can’t say that of GM now. The original TARP was something like $800 billion and the two Quantitative Easings done by the Fed total over $1 trillion with at least one more on the way. The Too Big To Fail banks still hold a lot of junk residential and commercial real estate paper on their books that they don’t have to mark to market and they are playing extend and pretend with their borrowers to avoid having to increase their loan loss reserves. In spite of this salaries and bonuses are at all time highs while inflation is increasing for the rest of us.
MikeAR, there is also the pending and anticipated further collapse of the US housing industry later this year, with home values currently at -32.4% of 2008 values according to one source I heard today.
So there are variables still waiting to unfold in the remainder of this year and all of next. However, I would be greatly, and pleasantly surprised, if both GM and Ford will be able to pay back all of the money they got from the tax payers. I see that as just too far out of the realm of possibilities, whereas I see the US financial system bailing out the rest of the world and making money at it, in the future.
After hearing Tim Geithner’s rant about raising the debt ceiling today I question why this administration continues the deficit spending of the Bush administration since they were elected precisely to stop the deficit spending and provide welcome change. Instead, we saw the UAW and the US auto industry bailed out at tax payer expense when by all accounts GM and Chrysler failed. It is for precisely that reason, among others, that I am not at all hopeful for a recovery of the US auto industry and I see mergers and liquidations ahead.
But if no other buying options existed, I would choose to buy a Ford over anything from GM or Chrysler, because Mulally has really done wonders with Ford. Maybe that’s why the UAW will collective try to bargain Ford into the grave as well, in upcoming negotiations. You’d think they would leave well enough alone since all the damage they caused to GM and Chrysler.
@highdesertcat- you seem ignorant of the reality that Obama added far more to our deficit in his first 100 days than Bush did in 8 years! That is not too surprising in light of your lack of understanding of a lot more.
Ford may have trouble retiring their debt, but GM is nearly debt free. The simple fact is NOTHING MORE is due to goverment from either company’s operations other than Ford’s relatively small, technology implementation loan.
Furthermore, there have been NO UAW RETIREES DUMPED ON THE PBGC. You may be confused regarding the Delphi Salaried retirees, who were dumped on PBGC at Obama’s direction.
Your opinions are you own business, but you ought to take the time to learn the truth about the financial situation so you don’t embarass yourself.
In case you missed it, I’m a Republican and been that way all of my 64 years. But I do want the US auto industry to be successful so it can repay all the tax payer money. I also don’t believe that will ever happen.
I also did not agree with Bush when he bailed out failed companies, and I liked it even less when Obama went on his spending binge. Then again, I didn’t vote for Obama, but I did vote for Bush.
And as far as being informed, I remember your spouting off back in 2008 that GM would never go tits up. So much for your credibility. Or was that just wishing and hoping on your part? Were you embarrassing yourself with your overly optimistic assessment of GM back then? Maybe you should keep a copy of your comments and posts just to remind yourself that you have talked out of both sides of your mouth over the years.
@highdesertcat- God Bless You!
Sorry for the nasty tone. I keep trying to stop, but fail. I keep getting “wrapped around the axle”. I didn’t like reading what I wrote when I looked at it with fresh eyes this AM. Passion overtakes me, too often.
Back in ’08 I passionately believed that bankruptcy would lead to a collapse of the whole industry for many considered reasons I’ve put out over and over.
I argued that they should not be allowed to go bankrupt, convinced it would initiate the death spiral so many seem to long for and far worse than most can even imagine.
I credit the government with the speed of the process, without which failure seemed almost certain to me.
I generally agree with you politically and wrt the UAW-Democrat connections.
I also know how much more there is to the company than just its union employees.
I know it is now strong and capable of sustained profitability right here in America and is doing very well in the worlds growth markets.
wrt Payback- There was a total of about $50B put into GM, Bush loans of $6.5B and Obama 61% equity in new GM swap for the additional $43.5B used to finance the bankruptcy and recapitalize the business.
GM repaid the $6.5B loans. Absolutely no more is due from the company’s operations. I do not understand why you keep writing that they need to repay the money. They are out of it, other than the final result will depend on GM stock price.
Treasury recovered an additional $17B in the IPO and still own 500million shares that would have to sell for $53 to recover the remaining government investment, a total of $26.5B .
If GM shares were sold today, taxpayers would lose about $10B, or 2 1/2 days interest on our debt or $33 per person in the U.S. Since the top 10% pay 90% of the taxes, that makes most of our share more like $3 a person.
If you really care about getting the most back, you should buy and boost GM. It is your company and stock price is the only factor that will define whether you win or lose in the end.
Indeed. UAW workers are quite fat.
Edward..Your attack on the Union people is getting stale.Are you also going to attack the 100,000+ people whose jobs were saved along with the union jobs because they didn’t say “Thanks”? Didn’t think so!!! In fact,the bailout probably saved your job too,you’re just to blind to really see how many jobs were saved, but go ahead and attack just the Unions.Edward..you’re attempt at Union bashing is getting really boring and maybe you should go tell your boss “thank you” for letting you write crap articles and still get paid.They do pay you,right? WHAT A WASTE OF MONEY !! Typical union hater,you attack when they don’t say “thank you” quick enough and you attack when they don’t do it the way “you” think they should. You are Pathetic!!
Of what union are you a member?
mmnaworker2, what most people object to is bailing out failed companies that were collective bargained in financial collapse by their union employees.
Both my parents belonged to a union, my dad belonged to the International Brotherhood of Electrical Workers, and my mom to SEIU, when they were still alive. Their unions did not collectively bargain their employers into failure.
Add to that the bad assembly that plagued the Detroit auto manufacturers for more than forty years, and bailing out losers really gets the tax paying public riled up.
Do you remember Reagan vs the PATCO union? There is a prime example of how unions should be handled. By that same token, all those people who can’t hack it and fall asleep on the job, should be fired! There will be others that will eagerly take their place.
Job bank, anyone?
Yes, it was the union that destroyed GM, and not decades of terrible product. What the hell was the union supposed to do when the factory started crapping out Pontiac Azteks? Gone on strike until GM designed a car that wasn’t the worst-looking thing this industry has created since the Edsel’s front grille? There’s no amount of assembly quality that would make that thing shift units.
aristurtle, there’s nothing a UAW member can do about butt-ugly cars. The only thing a UAW member does have control over is the quality of their own work. I have owned a few GM products over the years and without fail all of them had things wrong with them, from misaligned door and body panels, to parts falling off, both inside and outside the vehicle. Missing nuts, bolts and door panel fasteners also were an all-time favorite of mine, as were leaking windshields because the adhesive was applied too sparingly. This went all the way back to 1968 when I bought my first new car. I believe that this lack of quality and lack of reliability is what caused GM and Chrysler to nosedive into their financial graves. And I see no indicators that would lead me to believe that the tax payers will ever get their money back from the bail outs. I am a lot more optimistic about the financial industry since they do a lot more for our economy than the US auto makers. It’s not like we’re hurting for auto manufacturers in the US. The transplants all seem to do real well. If they weren’t, they wouldn’t be here. And we didn’t have to bail them out either. I don’t care if the UAW thanks the tax payers. I just want the tax payers to get their money back.
mmnaworker2,
I read Ed’s short paragraph not as a critique, but a point of interest that the UAW hasn’t more broadly taken steps to say sincerely, “Thanks”. As a union member yourself, do you feel thankful that the taxpayers bailed out your employer and your job? Seriously, do you feel a sense of graditude? If so, it’s not coming across. It’s the type of defensiveness that you put on display that makes those critical of unions believe the way they do.
I’ve been in a UAW factory. What is really impressive is the automation and robots. The more the better.
Chrysler just can’t win. I read posts complaining that they haven’t expressed appreciation and now condemnation for doing so!
The auto bailouts may not pay back 100%, but they will pay back most of the taxpayer investment. Any residual costs will be insignificant compare with the job losses and economic devastation they prevented.
All you bailout apologists I guess believe that nothing should ever change, that everything is static. It isn’t, jobs come and go, companies come and go. Everything changes over time, like it or not. Just think, if you people would have been running things in the 90’s we would still have every defense program going full blast just because if we cur spending or programs people would be put out of work. Guess what, thousands lost their jobs but most of them got new and better ones. You guys would have Conestoga wagon companies still in business churning out horse-drawn wagons by the thousands that there was no demand for.
Learn, this nothing is guaranteed, unless you’re a union and donate to Democrats. In that case anything goes. The sheer arrogance of believing GM and the UAW was entitled to be bailed out is amazing. And if you seriously believe that the world would have ended had GM and Chrysler not been baied out you are deluded. Do you really think that people, companies and even entire countriess hven’t failed before? You won’t admit that your Chicken Little scenarios wasn’t the only possible outcome. You do not know and can’t know. We do know that what happened has greatly weakened the rule of law in this country and has corrupted politics and business. No matter what those outcomes aren’t good. Plus we will probably be given the opportunity to do it all over again in a few years.
@MikeAR- “You think you know, but you have no idea!”, or in the immortal words of Firesign Theater “Everything you know is wrong!”
I agree with criticism of union connections with democrats, but these companies are far more than their UAW employees. It is clear you have no comprehension of this reality, nor any qualifications whatsoever to assess what would or would not have happened otherwise.
You asked me why I thought you were brain dead enough to watch Cribs. Your continued rants are ample evidence.
Learn, this nothing is guaranteed, unless you’re a union and donate to Democrats. In that case anything goes.
…or happen to be a multinational corporation or bank.