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Until yesterday, my wife worked at Goodyear. She was there for 8yrs doing “white collar” IT work, but they laid her off. I have no sympathy-NONE, NADA, ZIP for those autoworkers who make more than she did, have better benefits, and are killing their own industry as well as the thousands of vendors who support them. I say let em go bankrupt. If that means that 1, or 2 of the big three go down in flames, then fine. That’s the way it is. The companies were mismanaged. The labor force was greedy (yes, I said GREEDY), and the businesses have gorged and forced this nation into a dependence on foreign oil rather than make enough hybrids to be reasonably priced, rather than make fuel cell cars, rather than make steam powered cars, rather than make electric cars. Rather than do anything different than they did 30-40 yrs ago when the Arabs put an oil embargo on us and when Japan introduced fuel efficient cars…the big three kept their business plans and carried everyone down with em. If autoworkers lose their jobs because they were too arrogant to step down and make what my wife was making in a white collar, college-required job…then TFB! Eat it.
BUY HONDA, TOYOTA, KIA, anything BUT American because buying American means subsidizing unions that get more than they deserve, and it means fueling automakers who don’t care about national security, the environment, or their suppliers.
I hope they don’t get bailed out. If they do…then I want a bailout too.
That’s easy. Gettelfinger is waiting for President Obama and a Senate with 58 Democrats.
Yesterday on the Lehrer News Hour, David Brooks pointed out something even more obvious. He said that George W Bush was not about to let the American auto industry go down the toilet on his watch. Gettlefinger knew that he didn’t have to give away anything. And he didn’t. And Bush blinked.
I totally agree that, under present economic condition, the US auto industry needed to be restructured. This was a golden opportunity to do so. Bush should have called Gettlefinger’s bluff and stood with his party’s Senators.
Once again, George W Bush abandoned true conservative principles, to the detriment of the nation which elected him to govern as a conservative.
From nation-building wars to massive tax cuts in war time leading to a doubling of national debt to no child left behind to a massive new drug entitlement (while forbidding negotiations with drug companies to lower the costs of those drugs) to a trillion dollars in bail outs to nationalize everything from financial institutions to automobile companies.
Show me a real conservative, with liberterian social views, and I’ll strongly consider supporting him/her. A younger and somewhat less dogmatic Ron Paul, perhaps.
– Larry Weisenthal/Huntington Beach. CA
Craig
14 years ago
“Show me a real conservative and I’ll strongly consider supporting him/her.” (Larry W)
That is Sarah Palin, my friend. Who could have guessed you would have ever voted for her?
Bush isn’t a Conservative and he never was. Might as well bash him for not being an astronaut too.
Craig
14 years ago
“I gotta go w Larry on this one.” (Scott)
Sure, you are democrat like him.
MDenis39
14 years ago
I’m confused by the whole cost of labor issue – I’ve heard some folks (proponents of the bailout, mainly) state that labor costs are only about 10% of the cost of a car. If this is true, then the salaries for UAW workers is a (relatively) moot point. Personally, I am not a fan of unions, having been a Teamster for a few years. So I say if the UAW goes down with failure to pass a bailout, that’s just icing on the cake.
I believe the more important question is “will GM survive WITH a bailout?” I don’t see how it can with a bailout of even $50B. But with a different cost structure post Chapter 11 re-org, I believe investing $14B at that point in a bridge loan would be wise.
And here’s the one thing that bailout proponents bring up about Chap 11 – “no one will buy a car from a Chapter 11 company! It’s not like an airline, you have to have warranties… blah, blah, blah”. My question is, Who will buy a car from a mfr that is teetering on bankruptcy and needs more billions from the Gov every few months? You will have consumers waiting and waiting and waiting to see if it will survive – or just giving up & buying a Ford. In my case, I would be more inclined to buy from a post Chap11 company – get the pain over with in a hurry to get back to business, don’t drag it out to a slow, painful death over 3-5 years.
(Aside – I myself own a 2008 GMC Acadia and I love it. Despite that, I am against a bailout before Chap11)
A few other items thrown out about the bailout —
— Three million people will lose their jobs (I call bullsh** on that – that’s worst-case)
— All the suppliers will go out of business, bringing ALL auto mfg to a halt in the US
— Chap 11 would mean instant liquidation, not restructuring
BS on both of these – again, this is worst-case and the gov’t will and should step in to prevent either of these from happening, but it needs to be POST Chap11, which is sort of what Sen Corker’s plan was all about.
Firstly, I wouldn’t support Sarah Palin for two reasons. Most importantly, she’s a vacuous air head. Secondly, she’s not my dream candidate of an economic conservative, environmental liberal (as in steward of the planet), and social libertarian. Of these three, I consider numbers 1 and 3 to be most important; so I could go with a Ron Paul type of candidate who was younger (I refuse to vote for anyone over the age of 70 for President, for a number of medically-related reasons) and more pragmatic/less dogmatic. Sarah Palin is not a social libertarian; she’s a social conservative, meaning that she wants to impose her personal values onto me and onto everyone else. I consider people like Sarah Palin to be “Taliban Lite.”
Secondly, I’m supporting (and defending) Obama not because he comes anywhere near to being my perfect candidate (I am so proud that my GOP congressman, whom I voted for, Dana Rohrabacher, voted against the Wall Street bail out not just once but twice, while Obama supported throwing away one trillion dollars in the Wall Street bail out and now he’s going to throw away the better part of another trillion in walking around money disguised as an infrastructure program.)
But the big majority of the country is now Keynesian. There are no atheists in fox holes and there are no libertarians in an economic crisis. Unfortunate, but true. So we would have gotten a misguided bail out with McCain, just about as much as we are getting a misguided bail out with Bushobama.
I’m supporting Obama (not in order of importance):
1. Because I’m sick of wishing we had a President who is as articulate as Stephen Harper, much less Tony Blair.
2. Because the novelty of being the most hated nation on earth has worn off, and I’d really like people all over the world to think again of America as being that great shining beacon on a hill.
3. I remember the giddiness of being 13 years old and being inspired by a President who had the audacity to tell us “ask not what your country can do for you; ask what you can do for your country.” And then ask us to volunteer for America (VISTA) and for America in the service of the world (Peace Corps). And then to shoot for the moon and actually get there.
What it takes to make us into a nation of collective greatness is the ability to lead and inspire. Whatever virtues George W Bush may have had (and sometime I’ll write about the good things that the President did, for which he received insufficient credit), he was not an inspirational leader. If Iraq was a just war, a great leader could have communicated this to the American people and inspired them to stay behind the war effort. But Bush was no Churchill.
4. I am sick up to my eyeballs with this politics of hate business. Pogo famously said, we have the enemy, and he is us. No one on this blog is my enemy. You are my countrymen and women. I have honest differences of opinion with you over various issues, but you are all good people, as far as I can tell, who care about the well being of the country. You care about it enough to devote as much time as you do to advocating views which you believe will improve the country, just as I do.
Your differences of opinion arise because of differences in background, upbringing, life’s experience, and the way you interpret complex issues, in a political world which is seldom black and white (e.g. does DeMint oppose the auto bail out because of conservative principles or because it plays well at home, in a South Carolina with a tax payer supported foreign owned automobile industry?). Anyway, I can’t disrespect a Republican for being a Republican, anymore than I can disrespect a Catholic for being a Catholic. We all are what we are, and we are mostly good people, and I think that Obama has the ability to bring us together, at least to a degree, and I think that we need to be together to meet the challenges of a global economic crisis, a global environmental crisis (which goes beyond “global warming”), and a global security crisis.
He certainly doesn’t walk on water; he’s a pragmatist and not an idealist; he’s a conniving politician to his core, but I agree with Colin Powell and many others that he has the potential to be a transcendent President, of the likes which I have not seen since 1960. Perhaps I’m wrong. Perhaps probably I’m wrong. But it’s just the audacity of hope, I guess.
“1. Because I’m sick of wishing we had a President who is as articulate as Stephen Harper, much less Tony Blair.”
Yeah… much better to have a president who lies so much better than anyone else. You almost don’t mind that he lies because he does it so well.
Hard Right
14 years ago
Ron Paul is a fraud and a loon who blames America for 9/11. Yeah, your choices of who you support continues to be just stellar. BTW, obama is NONE of the things you claim to believe in.
As for Sarah being an air-head, You rely on heavily edited MSM footage to make that accusation. Glass houses Larry.
Obama be transcendant? Ha! He feels socialism is best for everyone and that is what he wants.
As to your number 2. You actually think sucking up to those countries will change anything? You are dangerously naive.
Craig
14 years ago
“I wouldn’t support Sarah Palin for two reasons. Most importantly, she’s a vacuous air head. ” (Larry W.)
Do you mean like you and Obama?
“I refuse to vote for anyone over the age of 70 for President, for a number of medically-related reasons” (Larry W.)
So you would have never voted for Reagan? But you don’t mind to vote for a smoker and a cocaine drug user?
“I’m supporting Obama because I’m sick of wishing we had a President who is as articulate as Stephen Harper, much less Tony Blair.” (Larry W.)
LOL! did you ever see him talk without a teleprompter… ug. ug. ug … lol?
“I’m supporting Obama because the novelty of being the most hated nation on earth” (Larry W.)
America was always hated, envied and jealoused, where do you come from? Mars? And she will be hated more after Obama.
“I’m supporting Obama because I remember the giddiness of being 13 years old and being inspired by a President” (Larry w.)
Lol! And Obama’s corruption inspires you? Gee… who would of believed this?
“I’m supporting Obama because I am sick up to my eyeballs with this politics of hate business.” (Larry W.)
Obama’s thugs are all about hate and Obama made a campaign on racism to divide this country and all his pals are American’s haters.
“I’m supporting Obama because I think that Obama has the ability to bring us together ” (Larry W.)
Are you kidding, this country has never been so divided than now and will stay divided till all Obamatrons realized that they got fooled by the ONE.
“Perhaps I’m wrong. Perhaps probably I’m wrong. But it’s just the audacity of hope, I guess.” (Larry W.)
Audacity of hope or hypnotism? Or naïvety? I’m getting to know you now. Larry, you are just a dreamer, a romantic dreamer that doesn’t live in the real world.
Hard Right
14 years ago
To expand on your number two, we did what we had to in order to protect America and our allies. Countries like France and Germany expect us to do what’s in their interest and not ours. That is one reason why they hate us. The other is jealousy. They consider themselves to be far smarter and more sophisticated than us and it burns them their opinion doesn’t matter and that we are the number one superpower. Another is what we see from liberals here–the claim that we are making things worse by fighting terrorism. They are only too willing to surrender to Islamic fascism. Larry, after the Afghanistan post you are sounding like a 16 year old that has a poor grasp on te world and reality.
Hard Right
14 years ago
Oh and Craig, great post.
Missy
14 years ago
Mike, Kudlow had this up at the NRO blogsite yesterday, wonder if the new article went to press before or after.
The TARP Deal Is Not Done [Larry Kudlow]
Media reports and Wall Street investors are now assuming the Treasury will put up $15 billion in TARP money to keep the Detroit carmakers out of bankruptcy. But my sources tell me that the TARP deal is not done — not by a long shot.
At a minimum, it’s going to take the Treasury several days to walk through the financial numbers and gather all the facts before it takes any action. The Treasury wants to see the cash-flow data and get to the truth about GM and Chrysler. (Ford doesn’t need the money.) And nothing will happen until these numbers are properly crunched. And the Treasury may well want to arrange for a built-in monitor — something that might even look like a car tsar — if any TARP money is dispersed.
Senate sources tell me that any TARP-money allocation might include the very same conditions proposed by Tennessee Sen. Bob Corker in legislation that broke down in a marathon session in the Senate list night.
So folks shouldn’t count their TARP eggs before they’re hatched. And nothing is expected to be announced today.
BTW, if anyone has ever wondered what the automakers/union contracts look like, here we go. Also, links to exactly what’s in the contracts should anyone want to spend the next two months perusing:
Mikey is well aware of the specific lies he’s been spreading — he has read my post and even commented there. Unsurprisingly, he prefers to feign ignorance.
Mikey is helping to spread the lie that the average compensation for union autoworkers at the Big Three automakers is more that $70 per hour.
Mikey is helping to spread the lie that the UAW has refused to make any concessions to aid the Big Three in obtaining federal aid.
Let’s see what excuses Mikey can concoct for deliberately helping to spread these lies.
Trying to build readership on our backs again meatbrain?
You remain part of the problem not part of the solution. Your refusal to do anything but carry water for the UAW is a sure sign that this problem and the economic hardship it imposes will continue to fester no matter how many billions we throw at it.
You should be ashamed of yourself. The first real solution that comes along triggers only a knee jerk reaction from no nothing, care nothing nit wits like yourself.
“No one ever said they make more than $70 per hour.”
Kudlow said that “Average compensation for the Detroit little three is $72.31”. This is a lie. This figure is padded by including benefits being paid to retirees — in effect, claiming that union workers now building cars are receiving compensation that includes benefits being paid to other people.
There have been multiple instances of claims in the media that Big Three autoworkers do, in fact, make wages of more than $70 per hour. Mikey again displays his ignorance.
The UAW did, in fact, offer concessions to aid the Big Three in obtaining federal aid. Mikey continues to ignore this fact.
I have said nothing regarding the costs “built in” to cars produced by the Big Three. Mikey tries and fails to derail the discussion by dragging in a red herring. We are discussing the lies he has chosen to spread.
Explain to us, Mikey, why you chose to help spread lies. Help us understand why your dishonesty does not shame you.
Meathead: Is it true, or is it not true that the UAW contract is the reason why the labor costs of GM, Ford and Chrylser cars are much higher than their counterparts located in other states?
You just keep trying to obfuscate the issue which is at the heart of this discussion. Such tactics only serve to perpetuate a financial situation which in the long run is unsustainable and will cause further economic hardships for millions.
Your STUPID talk about spreading lies only makes you look like a FOOL.
Therefore, I can only conclude that you ARE a fool!
Missy
14 years ago
Let’s just get nit pickey here. I’ve already mentioned that I have family employed at Chrysler, I know what the employees are getting.
It costs the big three auto makers over $70 per hour to employ each employee. No, they don’t get over $70 per hour in their checks, but included in that figure are all their benefits. health insurance, 95% of their pay during retooling which could last up to three months, 95% of their pay whenever they have a model change which lasts longer, sometimes up to a year, some lines can operate before it’s over, but it still costs the company when they aren’t making money.
Even though they shut down every summer with 95% of their pay, the employees still get vacation pay and vacation time to use at any time of the year they choose. My neighbor was getting six weeks paid vacation before he retired in addition to all the paid down time. They also get attorney fees for anything not criminal, they just have to declare the value of the services on their taxes.
Not included in the over $70 per hour are all the retiree benefits which include health insurance for life, pensions and above mentioned attorney fees, etc.
All of the benefits are costing the big 3 much more than the foreign competitors operating in the US which makes it impossible to compete.
Notice that Mikey is afraid to discuss the facts. The issue at the heart of this discussion is the willingness — nay, the eagerness — of Mikey and wingnuts like him to spread lies in support of their ideology.
There have been multiple instances of claims in the media that Big Three autoworkers receive compensation of more than $70 per hour. In some cases, the claim is made that Big Three autoworkers receive wages of more than $70 per hour. These claims are false.
I have no interest in Mikey’s labor costs red herring. Mikey is simply afraid to discuss the facts. Mikey works hard to ignore the facts. Mikey is a liar, and he happily helps to spread lies.
Yo, meathead. The “claims” are not false, even via that stellar news analyst site you cite, TNR. There is the cost of the union wages, pension, insurance… averaged out… plus the salary. You claim that’s false. Oddly enuf, that same formula was used to determine the competitors’ average hourly wage.
DOH
BTW, is Yale aware that you are using their server for blog hate posts, attacking individuals? More importantly, is Yale aware that you are a meathead/embarrassment to the institution as a whole???
“higher” education, my ass… unless, of course, they are talking about inhalants.
Unsurprisingly, “Mata Harley” chooses to lie as well.
“The “claims” are not false, even via that stellar news analyst site you cite, TNR.”
From the TNR article:
“…[W]hat’s the source of that $70 hourly figure? It didn’t come out of thin air. Analysts came up with it by including the cost of all employer-provided benefits — namely, health insurance and pensions — and then dividing by the number of workers. The result, they found, was that benefits for Big Three cost about $42 per hour, per employee. Add that to the wages — again, $28 per hour — and you get the $70 figure. Voila.
“Except … notice something weird about this calculation? It’s not as if each active worker is getting health benefits and pensions worth $42 per hour. That would come to nearly twice his or her wages. (Talk about gold-plated coverage!) Instead, each active worker is getting benefits equal only to a fraction of that — probably around $10 per hour, according to estimates from the International Motor Vehicle Program. The number only gets to $70 an hour if you include the cost of benefits for retirees–in other words, the cost of benefits for other people. One of the few people to grasp this was Portfolio.com’s Felix Salmon. As he noted yesterday, the claim that workers are getting $70 an hour in compensation is just “not true.””
TNR does, in fact, state that the claim of $70+ per hour compensation for union autoworkers is false. “Mata Harley” is lying.
“Oddly enuf, that same formula was used to determine the competitors’ average hourly wage.”
“Mata” provides no source for this claim. Apparently, we are simply supposed to take a liar’s word for this.
It is not clear why Mikey and his kind are unable to admit that counting benefits paid to retirees as part of the hourly total compensation for currently employed workers is deceptive and dishonest. It may be that, having been caught in their lies, they simply cannot imagine any course of action save repeating those lies over and over again, as though doing so would magically turn their lies into truth.
“I have no interest in Mikey’s labor costs red herring. “
That’s right. As I have pointed out you have no interest at all in finding a workable solution to this problem. Your goal here is to throw around insults about lies when it is transparently clear you have nothing more to offer.
Craig
14 years ago
lol… I just finish reading the “MeetnoBrain” comments up here. Hilarious!
“As I have pointed out you have no interest at all in finding a workable solution to this problem. Your goal here is to throw around insults about lies when it is transparently clear you have nothing more to offer.”
Mikey again tries, and again fails, to change the subject. His post was in no way intended to offer any sort of “workable solution”. Its sole purpose was to spread lies about the compensation paid to UAW autoworkers, and lies about the concessions offered by the UAW.
“…[W]hat’s the source of that $70 hourly figure? It didn’t come out of thin air. Analysts came up with it by including the cost of all employer-provided benefits — namely, health insurance and pensions — and then dividing by the number of workers. The result, they found, was that benefits for Big Three cost about $42 per hour, per employee. Add that to the wages — again, $28 per hour — and you get the $70 figure. Voila.
“Except … notice something weird about this calculation? It’s not as if each active worker is getting health benefits and pensions worth $42 per hour. That would come to nearly twice his or her wages. (Talk about gold-plated coverage!) Instead, each active worker is getting benefits equal only to a fraction of that — probably around $10 per hour, according to estimates from the International Motor Vehicle Program. The number only gets to $70 an hour if you include the cost of benefits for retirees–in other words, the cost of benefits for other people. One of the few people to grasp this was Portfolio.com’s Felix Salmon. As he noted yesterday, the claim that workers are getting $70 an hour in compensation is just “not true.””
The claim of $70+ per hour compensation for union autoworkers is false.
“The UAW’s concessions would permit the automakers to delay payments to the retiree healthcare trust [VEBA] due during 2009 and cancel the controversial jobs bank immediately. The union also plans to re-open contract discussions with all three automakers and will consider what Gettelfinger describes as “modifications” to the current contract.
“All three automakers have included additional concessions by the UAW as part their broad case for government bridge loans totaling $34 billion.”
The claim that the UAW was unwilling to make concessions to assist the Big Three automakers in obtaining federal aid is false.
It is not clear why Mikey and his kind are unable to admit that counting benefits paid to retirees as part of the hourly total compensation for currently employed workers is deceptive and dishonest. It may be that, having been caught in their lies, they simply cannot imagine any course of action save repeating those lies over and over again, as though doing so would magically turn their lies into truth.
Meatpie: The workable solution here is the one offered by Sen. Corker and supported by 90 members of the U.S. Senate. The only thing that stood in the way of that solution was the UAW which would prefer to see this problem worsen while it enjoys wasting billions more in taxpayer dollars.
All you have done here is fing your peurile insults and cry about “lies” and it has been clear from the beginning you offer nothing more.
The deeper you and your union allies dig this hole the deeper the climb out will be for all Americans whose livelihood depends on a healthy auto industry.
If you were capable of registering shame I would say shame on you!
ahh.. this is what our Ivy league Yale is kicking out out nowadays… those like meathead. I repeat, are they aware you are using their server for these purposes, meathead? And are they aware they have a student of such low calibre embarrassing them in public? By gawd… to pay so much to learn so little. Appalling.
Just because you don’t do your homework, I do, bozo. So perhaps you should corral your collegian testosterone, and consider adding to your reading repertoire.
GM reports their costs specifically at $69 per hour per employee. That one includes the retirees pensions. While it’s true the workers (i.e. Toyota vs Ford) receive approximately the same hourly wage, the overall costs to the companies is not even close. Most is due to UAW, benefits and pensions to retirees… other reasons include the more moderized factory methods of assembly. But that’s only GM. All are bouncing between the $70-$80 per hr with the benefits and pensions.
Now I realize that you don’t want to include the costs of the retiree pensions since it messes up your tidy little perception. But that’s a cost to the company, and contributes to the P&L bottom line. So play your little numbers game, and quote your sources who parse for partisan purposes. Too bad that doesn’t help the corporations who are still in the red for reality… even while you sit smugly by and say “that’ don’t count! No fair!” Duh wuh…
Not far back enough? How about in 2004? Hadn’t even begun to be a glint in your partisan eyeball back then, I bet. Too busy with frat parties to pay attention to what was predictably coming down the pike? Or perhaps you were still in high school then.
While you place your entire education portfolio of the auto financial status in the less than able hands of TNR, Missy and I both have relatives in the business. We’ve also both been around long enough to turn your hide over and tan it for your insolence, you pompous and arrogant cyberblowhard. But that’s another story.
My now deceased uncles were executives in Detroil with the auto industry. So I combine both multiple source quotes of their costs, combine it with personal experience… as does Missy… to come to conclusions.
And you? No doubt too busy playing beer pong with your buds to compile any research of substance other than where to buy a cheaper batch of replacement ping pong balls.
**************
Correction… let’s not give Yale a bad name for meathead. Apparently he’s a user of others’ proxy accounts. In other words, an arrogant geek with a ‘tude.
Craig
14 years ago
Mata, maybe “MeetnoBrain” is just the janitor at Yale… lol.
BTW, meathead… yes, they “averaged” Toyota’s cost per employee hourly the same way … tallying workers hourly wages and total costs of pensions, averaging it out to approx $48 per hour.
i.e. again from before this was on your political radar…. from Oct 2007 this Reuters article
The average UAW-represented GM assembly line worker makes just under $28 (U.S.) per hour now before health-care and other benefits that take total hourly labour costs to $73, the auto maker has said.
By contrast, Toyota’s average hourly cost for workers at its U.S. plants was under $48 per hour including benefits.
LOL Mike! Just po’s me when these bozos show up and parse words… trying to twist facts in order to mask the obvious. ala pretending these figures were what every individual worker gets.
But then what can you do with the “it all depends on what the meaning of “is”… is” mentality that permeates this country. And that’s the game meathead is playing.
Next Meatpie will be telling us Obama had no contact whatsover with Blagojevitch.
Missy
14 years ago
Your union boss bargained with Congress in bad faith. They just want the cash now to hold them over until Obama signs card check into law. Then they will trot down south and inflict the same disease on the foreign auto plants and create the same mess we are dealing with now.
The TNR article the union bot is posting is not accurate. The hourly figure does *NOT* include current retiree’s benefits, it includes *FUTURE* retirement benefits for those who are presently working.
The remaining $33.58 an hour of hourly labor costs that GM reports–46 percent of total compensation–was paid as benefits. These benefits include[5]:
Hospital, surgical, and prescription drug benefits;
Dental and vision benefits;
Group life insurance;
Disability benefits;
Supplemental Unemployment Benefits (SUB);
Pension payments to workers pensions accounts to be paid out at retirement;
Unemployment compensation; and
Payroll taxes (employer’s share).
These benefits cost the Detroit automakers significant amounts of money. Critics contend that these benefit figures include the cost of providing retirement and health benefits to currently retired workers, not just benefits for current workers. Since there are more retired than active employees this makes it appear that GM employees earn far more than they actually do.*******************************
This contention contradicts the plain meaning of what the automakers have reported in SEC filings and in their public statements and would be contrary to generally accepted accounting principles.**************************
Under the accounting rules established by the Financial Accounting Standards Board, the Detroit automakers must report their liability for future benefits as they accrue.[6] The hourly benefits figure includes payments into defined benefit pension plans to provide future pensions to current workers. It also includes the estimated costs of future retirement health benefits that current workers earn today.****************************
Chrysler, for example, reports paying $20.14 an hour in health costs for its hourly employees. That figure includes the estimated cost of their health benefits in retirement, calculated according to Financial Accounting Standard 106.[7] The government does not allow Chrysler to promise to pay tens of thousands of dollars in health benefits in the future without reporting that cost on its balance sheets today.
The hourly benefit figures the Detroit automakers report covers the cost of current and future benefits earned by actively working employees. It does not include the cost of paying health benefits and pensions to current retirees.*********************
Before they requested a bailout, the Big Three automakers specifically explained that their labor cost figures do not include the cost of past work. General Motors states in its filings with the Securities and Exchange Commission that:
GM maintains hourly and salaried benefit plans that provide postretirement medical, dental, vision, and life insurance to most U.S. and Canadian retirees and eligible dependents. The cost of such benefits is recognized in the consolidated financial statements during the period employees provide service to GM.[8]
In other words, GM records the expense for retiree benefits when workers earn the benefits, not years later when they collect their benefits. In less technical language, Ford explains that their total average hourly labor costs include:
(1) All the dollars paid to employees, (2) the cost of contractual benefits for employees, and (3) the cost of statutory payments, such as Social Security and Workers’ Compensation–all calculated on the basis of hours worked by employees.[9]
Average hourly costs include the costs of wages and benefits (current and future) to employees divided by the number of hours worked by those same employees. It does not include the benefits paid to retirees.[10] This is in accord with standard accounting principles that require the Big Three to report their costs as they occur. Labor costs are the costs to the Detroit automakers of employing its current workers, not paying former workers for services performed decades ago.
No problem Mata, just had to remember where I saw the information. While making my morning rounds I noticed a few newbies posting pro union information in high traffic blogsites. In one comment section alone, out of 258 comments one guy repeatedly posted the same copy and paste and then added the auto manufacturers need to up the price of their vehicles and the problem will be solved, sheesh. I think these people are warming up the seats the Obamabots just left, before this is all over I expect the robo-calls to start rolling in.
This is all a distraction, just like the democrats trotting out the information about the foreign auto companies getting tax credits, failing to mention the big 3 get them too for various reasons. With 52% of the union auto workers NOT wanting a bail out, seems like all this isn’t playing yet in Peoria, but it probably will eventually if they keep up the misinformation campaign.
“Now I realize that you don’t want to include the costs of the retiree pensions since it messes up your tidy little perception.”
False. The cost of retiree pensions and health care cannot be included in the compensation received by currently active autoworkers because it is not paid to currently active autoworkers.
It’s a simple concept — so simple, in fact, that Mikey and his merry band of fellow liars prefer to pretend it does not exist at all. The claim made by Kudlow and others, and echoed by Mikey and the liars’ club here at Flopping Asshats, was that “Average compensation for the Detroit little three is $72.31”. That is quite simply false, because it includes benefits not paid to the workers now building cars.
The total costs of labor, including health benefits and pensions to retirees, may well average out to more than $70 per hour worked by current workers. But to claim that current workers are compensated to the tune of $70+ per hour is flatly and blatantly dishonest.
“BTW, meathead… yes, they “averaged” Toyota’s cost per employee hourly the same way…”
Irrelevant. The claim was not that “cost per employee hourly” was $70+ dollars per hour. The claim was that UAW workers are compensated at a rate of $70+ dollars per hour. That claim is a lie.
“The hourly figure does *NOT* include current retiree’s benefits…”
False. It is already well documented that this figure does, in fact, include the benefits paid to current retirees. It is also worth noting that the Heritage Foundation’s analysis are based largely on estimates — not actual costs — provided by auto companies in “fact books” issued during contract negotiations. Laughably, the Heritage Foundation can provide no documentation whatsoever for the claim that the benefits figure for Ford do not include retiree benefits — merely the alleged verbal confirmation from an unnamed Ford employee.
Further, the original claim made by the Heritage Foundation was that “UAW workers earn $75 an hour in wages and benefits“. Note the subtle change in this claim — now it’s “UAW Workers Actually Cost the Big Three Automakers $70 an Hour”. Why the change? Because it is now painfully obvious that this “cost” is simply an artifact of accounting, and does not represent anything near to the reality of how autoworkers are actually compensated for their labor. This is a consequence of FAS 106, an accounting method that requires companies to “employers must replace pay-as-you-go accounting with accrual accounting. That is, their balance sheets must show the expected cost of providing retiree health and welfare benefits for all employees and retirees eligible to receive such benefits, currently or in the future.”
Oops. The costs reported by the automakers in their SEC filings, in accordance with FAS 106, includes “benefits for all employees and retirees eligible to receive such benefits“. That pretty much settles the matter: the figures being touted by the Heritage Foundation and other far right pundits, derived as they are solely from information supplied by the automakers, are indeed padded with benefits for current retirees — but we are supposed to ignore this fact, and pretend that it’s those greedy workers gobbling up all the cash.
The willingness of the wingnuts to believe any lie fed to them by the right-wing noise machine is legendary. I thank my fellow commenters for again confirming their exceptional gullibility.
I left this reply to one of the Mike’s America readers who actually LIVES near Detroit and has to deal with reality, not the fantasy that Meatpie is pushing. It fits here too:
Wade: It’s far easier for poor diminished meatpie to go flinging around that LIAR label than it is for him to engage in an intellectually honest discussion of the problem here.
Now that President Bush has offered a big three a bailout (which reminds me… did we hear any praise from meatpie when Bush did that?) the problem will be held over until next year when Obama and the Dems can use billions more in taxpayer funds to shelter big union bosses from any accountability for the mess THEY made.
Notice that Mikey is entirely unable to specify what part of my arguments is “fantasy”, or provide any evidence to back up this claim. No, we are simply expected to believe that it is so Because! Mikey! Says! So!
Believe it or not, among wingnuts the fact-free assertion is considered a very high quality “argument”.
“we are simply expected to believe that it is so Because! Mikey! Says! So!”
Yes you are.
“Mikey” has already wasted enough time presenting FACTS which meatpie finds it convenient to ignore. “Mikey” has better things to do than argue with a fool who is simply trying to prop up the union bosses and prolong the agony of their workers.
There is a lot of bogus propaganda being put out there by the unions and the mass media with regards of the hourly wage of union workers as well as the hourly compensation of union workers as well as the hourly cost to the Big 3 companies of the union workers.
When all is said and done, from what I have read, there is a $10/hour gap between the compensation paid to the union workers (salary + benefits) compared to what the foreign companies pay their workers. Most of that $10 is in the benefits packages union members get. The foreign companies don’t pay benefits as high as the unions.
However, the cost to the Big 3 companies for each union member is much, much greater, and that is where the Big 3 are having major trouble competing financially with the foreign companies. Because the Big 3 have such a large retired force compared to the foreign companies, if one takes the amount of money each company must pay its employees — both active and retired – and divides by the active workforce, that is where the Big 3 end up paying $70+/hour per active worker compared to the foreign companies who are only paying about half that.
There is just no way to compete with that kind of cost/revenue discrepancy.
Either the benefits packages need to come down or the packages to the retirees must come down.
The last numbers that I saw were stated to be around $45/hour (salary + benefits) for the foreign company workers vs $55/hour (salary + benefits) for the UAW workers. And then the additional $15/hour/worker to cover the cost of retirees’ packages.
Something needs to give. The Big 3 cannot continue to compete when their pay gap is around $25/hour/active worker.
Also, upon talking to a coworker of mine who came to our job from previously being in the UAW, he said that the way the union works is based on entitlement, seniority and time in with the union, not based on merit. Also, no matter what, workers who bust their butts to do their jobs to the best of their ability are rewarded the same as those who slack off and screw off. And there is no incentive for anyone to do any better, because UAW workers are only rewarded based on time in with the union, not merit. They also won’t fire people based on lack of production.
To put it simply, the problem is that the union could care less about the Big 3 and could care less about their product. Their focus is only on making the most money and getting the most benefits, no matter the consequences and no matter whether they are getting results or not. It’s much like the Teacher’s Unions which are run the same way. No matter their performance and the performance of their kids, they don’t care, they simply want more money, more pay and more benefits.
At one time the unions served a good purpose, to stop companies from treating their employees poorly. But now, the unions have become so wrought with power and greed, that the pendulum of corruption has swung entirely the opposite way and the unions are ruining things.
We need to get back to a system of merit, not a system of entitlement. Workers should be rewarded for good work and punished — even fired — for lack of production and poor work. Until that happens, the Big 3 are going to continue to fail to compete with the foreign companies.
scott in tenn.
14 years ago
First time ive left an entry here but i have to agree with MICHAEL in MI at one time unions was a good thing , and im not saying all unions are bad , but it seems to me that all they are worried about are themselves and not the ones they are supposed to help protect …THE WORKER ……
Until yesterday, my wife worked at Goodyear. She was there for 8yrs doing “white collar” IT work, but they laid her off. I have no sympathy-NONE, NADA, ZIP for those autoworkers who make more than she did, have better benefits, and are killing their own industry as well as the thousands of vendors who support them. I say let em go bankrupt. If that means that 1, or 2 of the big three go down in flames, then fine. That’s the way it is. The companies were mismanaged. The labor force was greedy (yes, I said GREEDY), and the businesses have gorged and forced this nation into a dependence on foreign oil rather than make enough hybrids to be reasonably priced, rather than make fuel cell cars, rather than make steam powered cars, rather than make electric cars. Rather than do anything different than they did 30-40 yrs ago when the Arabs put an oil embargo on us and when Japan introduced fuel efficient cars…the big three kept their business plans and carried everyone down with em. If autoworkers lose their jobs because they were too arrogant to step down and make what my wife was making in a white collar, college-required job…then TFB! Eat it.
BUY HONDA, TOYOTA, KIA, anything BUT American because buying American means subsidizing unions that get more than they deserve, and it means fueling automakers who don’t care about national security, the environment, or their suppliers.
I hope they don’t get bailed out. If they do…then I want a bailout too.
Yesterday on the Lehrer News Hour, David Brooks pointed out something even more obvious. He said that George W Bush was not about to let the American auto industry go down the toilet on his watch. Gettlefinger knew that he didn’t have to give away anything. And he didn’t. And Bush blinked.
I totally agree that, under present economic condition, the US auto industry needed to be restructured. This was a golden opportunity to do so. Bush should have called Gettlefinger’s bluff and stood with his party’s Senators.
Once again, George W Bush abandoned true conservative principles, to the detriment of the nation which elected him to govern as a conservative.
From nation-building wars to massive tax cuts in war time leading to a doubling of national debt to no child left behind to a massive new drug entitlement (while forbidding negotiations with drug companies to lower the costs of those drugs) to a trillion dollars in bail outs to nationalize everything from financial institutions to automobile companies.
Show me a real conservative, with liberterian social views, and I’ll strongly consider supporting him/her. A younger and somewhat less dogmatic Ron Paul, perhaps.
– Larry Weisenthal/Huntington Beach. CA
“Show me a real conservative and I’ll strongly consider supporting him/her.” (Larry W)
That is Sarah Palin, my friend. Who could have guessed you would have ever voted for her?
The liberal mantra: When in doubt blame it on Bush!
Thanks Larry… WIth that kind of thinking it’s no wonder the Unions will never make the concessions necessary to make their companies profitable.
You say you would support a real Conservative Larry, but root for obama like there is no tomorrow. You’ll excuse me if I don’t believe you.
And Larry, I don’t hear you complain aboyt the insane spending by dems or how obama’s “stimulus” package has reached 1 TRILLION dollars.
I gotta go w Larry on this one.
Bush isn’t a Conservative and he never was. Might as well bash him for not being an astronaut too.
“I gotta go w Larry on this one.” (Scott)
Sure, you are democrat like him.
I’m confused by the whole cost of labor issue – I’ve heard some folks (proponents of the bailout, mainly) state that labor costs are only about 10% of the cost of a car. If this is true, then the salaries for UAW workers is a (relatively) moot point. Personally, I am not a fan of unions, having been a Teamster for a few years. So I say if the UAW goes down with failure to pass a bailout, that’s just icing on the cake.
I believe the more important question is “will GM survive WITH a bailout?” I don’t see how it can with a bailout of even $50B. But with a different cost structure post Chapter 11 re-org, I believe investing $14B at that point in a bridge loan would be wise.
And here’s the one thing that bailout proponents bring up about Chap 11 – “no one will buy a car from a Chapter 11 company! It’s not like an airline, you have to have warranties… blah, blah, blah”. My question is, Who will buy a car from a mfr that is teetering on bankruptcy and needs more billions from the Gov every few months? You will have consumers waiting and waiting and waiting to see if it will survive – or just giving up & buying a Ford. In my case, I would be more inclined to buy from a post Chap11 company – get the pain over with in a hurry to get back to business, don’t drag it out to a slow, painful death over 3-5 years.
(Aside – I myself own a 2008 GMC Acadia and I love it. Despite that, I am against a bailout before Chap11)
A few other items thrown out about the bailout —
— Three million people will lose their jobs (I call bullsh** on that – that’s worst-case)
— All the suppliers will go out of business, bringing ALL auto mfg to a halt in the US
— Chap 11 would mean instant liquidation, not restructuring
BS on both of these – again, this is worst-case and the gov’t will and should step in to prevent either of these from happening, but it needs to be POST Chap11, which is sort of what Sen Corker’s plan was all about.
Some random comments:
Firstly, I wouldn’t support Sarah Palin for two reasons. Most importantly, she’s a vacuous air head. Secondly, she’s not my dream candidate of an economic conservative, environmental liberal (as in steward of the planet), and social libertarian. Of these three, I consider numbers 1 and 3 to be most important; so I could go with a Ron Paul type of candidate who was younger (I refuse to vote for anyone over the age of 70 for President, for a number of medically-related reasons) and more pragmatic/less dogmatic. Sarah Palin is not a social libertarian; she’s a social conservative, meaning that she wants to impose her personal values onto me and onto everyone else. I consider people like Sarah Palin to be “Taliban Lite.”
Secondly, I’m supporting (and defending) Obama not because he comes anywhere near to being my perfect candidate (I am so proud that my GOP congressman, whom I voted for, Dana Rohrabacher, voted against the Wall Street bail out not just once but twice, while Obama supported throwing away one trillion dollars in the Wall Street bail out and now he’s going to throw away the better part of another trillion in walking around money disguised as an infrastructure program.)
But the big majority of the country is now Keynesian. There are no atheists in fox holes and there are no libertarians in an economic crisis. Unfortunate, but true. So we would have gotten a misguided bail out with McCain, just about as much as we are getting a misguided bail out with Bushobama.
I’m supporting Obama (not in order of importance):
1. Because I’m sick of wishing we had a President who is as articulate as Stephen Harper, much less Tony Blair.
2. Because the novelty of being the most hated nation on earth has worn off, and I’d really like people all over the world to think again of America as being that great shining beacon on a hill.
3. I remember the giddiness of being 13 years old and being inspired by a President who had the audacity to tell us “ask not what your country can do for you; ask what you can do for your country.” And then ask us to volunteer for America (VISTA) and for America in the service of the world (Peace Corps). And then to shoot for the moon and actually get there.
What it takes to make us into a nation of collective greatness is the ability to lead and inspire. Whatever virtues George W Bush may have had (and sometime I’ll write about the good things that the President did, for which he received insufficient credit), he was not an inspirational leader. If Iraq was a just war, a great leader could have communicated this to the American people and inspired them to stay behind the war effort. But Bush was no Churchill.
4. I am sick up to my eyeballs with this politics of hate business. Pogo famously said, we have the enemy, and he is us. No one on this blog is my enemy. You are my countrymen and women. I have honest differences of opinion with you over various issues, but you are all good people, as far as I can tell, who care about the well being of the country. You care about it enough to devote as much time as you do to advocating views which you believe will improve the country, just as I do.
Your differences of opinion arise because of differences in background, upbringing, life’s experience, and the way you interpret complex issues, in a political world which is seldom black and white (e.g. does DeMint oppose the auto bail out because of conservative principles or because it plays well at home, in a South Carolina with a tax payer supported foreign owned automobile industry?). Anyway, I can’t disrespect a Republican for being a Republican, anymore than I can disrespect a Catholic for being a Catholic. We all are what we are, and we are mostly good people, and I think that Obama has the ability to bring us together, at least to a degree, and I think that we need to be together to meet the challenges of a global economic crisis, a global environmental crisis (which goes beyond “global warming”), and a global security crisis.
He certainly doesn’t walk on water; he’s a pragmatist and not an idealist; he’s a conniving politician to his core, but I agree with Colin Powell and many others that he has the potential to be a transcendent President, of the likes which I have not seen since 1960. Perhaps I’m wrong. Perhaps probably I’m wrong. But it’s just the audacity of hope, I guess.
– Larry Weisenthal/Huntington Beach, CA
I’ll just tackle that first one:
“1. Because I’m sick of wishing we had a President who is as articulate as Stephen Harper, much less Tony Blair.”
Yeah… much better to have a president who lies so much better than anyone else. You almost don’t mind that he lies because he does it so well.
Ron Paul is a fraud and a loon who blames America for 9/11. Yeah, your choices of who you support continues to be just stellar. BTW, obama is NONE of the things you claim to believe in.
As for Sarah being an air-head, You rely on heavily edited MSM footage to make that accusation. Glass houses Larry.
Obama be transcendant? Ha! He feels socialism is best for everyone and that is what he wants.
As to your number 2. You actually think sucking up to those countries will change anything? You are dangerously naive.
“I wouldn’t support Sarah Palin for two reasons. Most importantly, she’s a vacuous air head. ” (Larry W.)
Do you mean like you and Obama?
“I refuse to vote for anyone over the age of 70 for President, for a number of medically-related reasons” (Larry W.)
So you would have never voted for Reagan? But you don’t mind to vote for a smoker and a cocaine drug user?
“I’m supporting Obama because I’m sick of wishing we had a President who is as articulate as Stephen Harper, much less Tony Blair.” (Larry W.)
LOL! did you ever see him talk without a teleprompter… ug. ug. ug … lol?
“I’m supporting Obama because the novelty of being the most hated nation on earth” (Larry W.)
America was always hated, envied and jealoused, where do you come from? Mars? And she will be hated more after Obama.
“I’m supporting Obama because I remember the giddiness of being 13 years old and being inspired by a President” (Larry w.)
Lol! And Obama’s corruption inspires you? Gee… who would of believed this?
“I’m supporting Obama because I am sick up to my eyeballs with this politics of hate business.” (Larry W.)
Obama’s thugs are all about hate and Obama made a campaign on racism to divide this country and all his pals are American’s haters.
“I’m supporting Obama because I think that Obama has the ability to bring us together ” (Larry W.)
Are you kidding, this country has never been so divided than now and will stay divided till all Obamatrons realized that they got fooled by the ONE.
“Perhaps I’m wrong. Perhaps probably I’m wrong. But it’s just the audacity of hope, I guess.” (Larry W.)
Audacity of hope or hypnotism? Or naïvety? I’m getting to know you now. Larry, you are just a dreamer, a romantic dreamer that doesn’t live in the real world.
To expand on your number two, we did what we had to in order to protect America and our allies. Countries like France and Germany expect us to do what’s in their interest and not ours. That is one reason why they hate us. The other is jealousy. They consider themselves to be far smarter and more sophisticated than us and it burns them their opinion doesn’t matter and that we are the number one superpower. Another is what we see from liberals here–the claim that we are making things worse by fighting terrorism. They are only too willing to surrender to Islamic fascism. Larry, after the Afghanistan post you are sounding like a 16 year old that has a poor grasp on te world and reality.
Oh and Craig, great post.
Mike, Kudlow had this up at the NRO blogsite yesterday, wonder if the new article went to press before or after.
The TARP Deal Is Not Done [Larry Kudlow]
Media reports and Wall Street investors are now assuming the Treasury will put up $15 billion in TARP money to keep the Detroit carmakers out of bankruptcy. But my sources tell me that the TARP deal is not done — not by a long shot.
At a minimum, it’s going to take the Treasury several days to walk through the financial numbers and gather all the facts before it takes any action. The Treasury wants to see the cash-flow data and get to the truth about GM and Chrysler. (Ford doesn’t need the money.) And nothing will happen until these numbers are properly crunched. And the Treasury may well want to arrange for a built-in monitor — something that might even look like a car tsar — if any TARP money is dispersed.
Senate sources tell me that any TARP-money allocation might include the very same conditions proposed by Tennessee Sen. Bob Corker in legislation that broke down in a marathon session in the Senate list night.
So folks shouldn’t count their TARP eggs before they’re hatched. And nothing is expected to be announced today.
BTW, if anyone has ever wondered what the automakers/union contracts look like, here we go. Also, links to exactly what’s in the contracts should anyone want to spend the next two months perusing:
Mikey:
Explain why you are helping to spread lies.
Care to elaborate on those “lies” meatbrain?
Mikey is well aware of the specific lies he’s been spreading — he has read my post and even commented there. Unsurprisingly, he prefers to feign ignorance.
Mikey is helping to spread the lie that the average compensation for union autoworkers at the Big Three automakers is more that $70 per hour.
Mikey is helping to spread the lie that the UAW has refused to make any concessions to aid the Big Three in obtaining federal aid.
Let’s see what excuses Mikey can concoct for deliberately helping to spread these lies.
Trying to build readership on our backs again meatbrain?
You remain part of the problem not part of the solution. Your refusal to do anything but carry water for the UAW is a sure sign that this problem and the economic hardship it imposes will continue to fester no matter how many billions we throw at it.
You should be ashamed of yourself. The first real solution that comes along triggers only a knee jerk reaction from no nothing, care nothing nit wits like yourself.
Mikey does what many liars do when confronted with their lies: He simply ignores the evidence.
UAW autoworkers do not, in fact, make more than $70 an hour. Mikey chooses to ignore this fact.
The UAW did, in fact, offer concessions to aid the Big Three in obtaining federal aid. Mikey chooses to ignore this fact.
Explain to us, Mikey, why you chose to help spread lies. Help us understand why your dishonesty does not shame you.
meatpie: Seems to me you know a thing or two about lying. Is it because you have so much experience in the field yourself?
No one ever said they make more than $70 per hour. If that was misleading in Kudlow’s piece only an idiot would believe it.
It is undeniable that each car produced by the Big Three has much higher costs built into it as a result of the UAW contract.
If you want to deny that reality then it will be clear to everyone who is lying here.
“No one ever said they make more than $70 per hour.”
Kudlow said that “Average compensation for the Detroit little three is $72.31”. This is a lie. This figure is padded by including benefits being paid to retirees — in effect, claiming that union workers now building cars are receiving compensation that includes benefits being paid to other people.
There have been multiple instances of claims in the media that Big Three autoworkers do, in fact, make wages of more than $70 per hour. Mikey again displays his ignorance.
The UAW did, in fact, offer concessions to aid the Big Three in obtaining federal aid. Mikey continues to ignore this fact.
I have said nothing regarding the costs “built in” to cars produced by the Big Three. Mikey tries and fails to derail the discussion by dragging in a red herring. We are discussing the lies he has chosen to spread.
Explain to us, Mikey, why you chose to help spread lies. Help us understand why your dishonesty does not shame you.
Meathead: Is it true, or is it not true that the UAW contract is the reason why the labor costs of GM, Ford and Chrylser cars are much higher than their counterparts located in other states?
You just keep trying to obfuscate the issue which is at the heart of this discussion. Such tactics only serve to perpetuate a financial situation which in the long run is unsustainable and will cause further economic hardships for millions.
Your STUPID talk about spreading lies only makes you look like a FOOL.
Therefore, I can only conclude that you ARE a fool!
Let’s just get nit pickey here. I’ve already mentioned that I have family employed at Chrysler, I know what the employees are getting.
It costs the big three auto makers over $70 per hour to employ each employee. No, they don’t get over $70 per hour in their checks, but included in that figure are all their benefits. health insurance, 95% of their pay during retooling which could last up to three months, 95% of their pay whenever they have a model change which lasts longer, sometimes up to a year, some lines can operate before it’s over, but it still costs the company when they aren’t making money.
Even though they shut down every summer with 95% of their pay, the employees still get vacation pay and vacation time to use at any time of the year they choose. My neighbor was getting six weeks paid vacation before he retired in addition to all the paid down time. They also get attorney fees for anything not criminal, they just have to declare the value of the services on their taxes.
Not included in the over $70 per hour are all the retiree benefits which include health insurance for life, pensions and above mentioned attorney fees, etc.
All of the benefits are costing the big 3 much more than the foreign competitors operating in the US which makes it impossible to compete.
Notice that Mikey is afraid to discuss the facts. The issue at the heart of this discussion is the willingness — nay, the eagerness — of Mikey and wingnuts like him to spread lies in support of their ideology.
There have been multiple instances of claims in the media that Big Three autoworkers receive compensation of more than $70 per hour. In some cases, the claim is made that Big Three autoworkers receive wages of more than $70 per hour. These claims are false.
Also, the assertion that the UAW was unwilling to make concessions is false. The UAW offered several concessions designed to assist the Big Three in obtaining federal aid.
I have no interest in Mikey’s labor costs red herring. Mikey is simply afraid to discuss the facts. Mikey works hard to ignore the facts. Mikey is a liar, and he happily helps to spread lies.
Yo, meathead. The “claims” are not false, even via that stellar news analyst site you cite, TNR. There is the cost of the union wages, pension, insurance… averaged out… plus the salary. You claim that’s false. Oddly enuf, that same formula was used to determine the competitors’ average hourly wage.
DOH
BTW, is Yale aware that you are using their server for blog hate posts, attacking individuals? More importantly, is Yale aware that you are a meathead/embarrassment to the institution as a whole???
“higher” education, my ass… unless, of course, they are talking about inhalants.
Unsurprisingly, “Mata Harley” chooses to lie as well.
“The “claims” are not false, even via that stellar news analyst site you cite, TNR.”
From the TNR article:
“…[W]hat’s the source of that $70 hourly figure? It didn’t come out of thin air. Analysts came up with it by including the cost of all employer-provided benefits — namely, health insurance and pensions — and then dividing by the number of workers. The result, they found, was that benefits for Big Three cost about $42 per hour, per employee. Add that to the wages — again, $28 per hour — and you get the $70 figure. Voila.
“Except … notice something weird about this calculation? It’s not as if each active worker is getting health benefits and pensions worth $42 per hour. That would come to nearly twice his or her wages. (Talk about gold-plated coverage!) Instead, each active worker is getting benefits equal only to a fraction of that — probably around $10 per hour, according to estimates from the International Motor Vehicle Program. The number only gets to $70 an hour if you include the cost of benefits for retirees–in other words, the cost of benefits for other people. One of the few people to grasp this was Portfolio.com’s Felix Salmon. As he noted yesterday, the claim that workers are getting $70 an hour in compensation is just “not true.””
TNR does, in fact, state that the claim of $70+ per hour compensation for union autoworkers is false. “Mata Harley” is lying.
“Oddly enuf, that same formula was used to determine the competitors’ average hourly wage.”
“Mata” provides no source for this claim. Apparently, we are simply supposed to take a liar’s word for this.
It is not clear why Mikey and his kind are unable to admit that counting benefits paid to retirees as part of the hourly total compensation for currently employed workers is deceptive and dishonest. It may be that, having been caught in their lies, they simply cannot imagine any course of action save repeating those lies over and over again, as though doing so would magically turn their lies into truth.
“I have no interest in Mikey’s labor costs red herring. “
That’s right. As I have pointed out you have no interest at all in finding a workable solution to this problem. Your goal here is to throw around insults about lies when it is transparently clear you have nothing more to offer.
lol… I just finish reading the “MeetnoBrain” comments up here. Hilarious!
“As I have pointed out you have no interest at all in finding a workable solution to this problem. Your goal here is to throw around insults about lies when it is transparently clear you have nothing more to offer.”
Mikey again tries, and again fails, to change the subject. His post was in no way intended to offer any sort of “workable solution”. Its sole purpose was to spread lies about the compensation paid to UAW autoworkers, and lies about the concessions offered by the UAW.
From the TNR article:
“…[W]hat’s the source of that $70 hourly figure? It didn’t come out of thin air. Analysts came up with it by including the cost of all employer-provided benefits — namely, health insurance and pensions — and then dividing by the number of workers. The result, they found, was that benefits for Big Three cost about $42 per hour, per employee. Add that to the wages — again, $28 per hour — and you get the $70 figure. Voila.
“Except … notice something weird about this calculation? It’s not as if each active worker is getting health benefits and pensions worth $42 per hour. That would come to nearly twice his or her wages. (Talk about gold-plated coverage!) Instead, each active worker is getting benefits equal only to a fraction of that — probably around $10 per hour, according to estimates from the International Motor Vehicle Program. The number only gets to $70 an hour if you include the cost of benefits for retirees–in other words, the cost of benefits for other people. One of the few people to grasp this was Portfolio.com’s Felix Salmon. As he noted yesterday, the claim that workers are getting $70 an hour in compensation is just “not true.””
The claim of $70+ per hour compensation for union autoworkers is false.
From a recent article in TIME:
“The UAW’s concessions would permit the automakers to delay payments to the retiree healthcare trust [VEBA] due during 2009 and cancel the controversial jobs bank immediately. The union also plans to re-open contract discussions with all three automakers and will consider what Gettelfinger describes as “modifications” to the current contract.
“All three automakers have included additional concessions by the UAW as part their broad case for government bridge loans totaling $34 billion.”
The claim that the UAW was unwilling to make concessions to assist the Big Three automakers in obtaining federal aid is false.
It is not clear why Mikey and his kind are unable to admit that counting benefits paid to retirees as part of the hourly total compensation for currently employed workers is deceptive and dishonest. It may be that, having been caught in their lies, they simply cannot imagine any course of action save repeating those lies over and over again, as though doing so would magically turn their lies into truth.
Meatpie: The workable solution here is the one offered by Sen. Corker and supported by 90 members of the U.S. Senate. The only thing that stood in the way of that solution was the UAW which would prefer to see this problem worsen while it enjoys wasting billions more in taxpayer dollars.
All you have done here is fing your peurile insults and cry about “lies” and it has been clear from the beginning you offer nothing more.
The deeper you and your union allies dig this hole the deeper the climb out will be for all Americans whose livelihood depends on a healthy auto industry.
If you were capable of registering shame I would say shame on you!
ahh.. this is what our Ivy league Yale is kicking out out nowadays… those like meathead. I repeat, are they aware you are using their server for these purposes, meathead? And are they aware they have a student of such low calibre embarrassing them in public? By gawd… to pay so much to learn so little. Appalling.
Just because you don’t do your homework, I do, bozo. So perhaps you should corral your collegian testosterone, and consider adding to your reading repertoire.
GM reports their costs specifically at $69 per hour per employee. That one includes the retirees pensions. While it’s true the workers (i.e. Toyota vs Ford) receive approximately the same hourly wage, the overall costs to the companies is not even close. Most is due to UAW, benefits and pensions to retirees… other reasons include the more moderized factory methods of assembly. But that’s only GM. All are bouncing between the $70-$80 per hr with the benefits and pensions.
Now I realize that you don’t want to include the costs of the retiree pensions since it messes up your tidy little perception. But that’s a cost to the company, and contributes to the P&L bottom line. So play your little numbers game, and quote your sources who parse for partisan purposes. Too bad that doesn’t help the corporations who are still in the red for reality… even while you sit smugly by and say “that’ don’t count! No fair!” Duh wuh…
These high hourly costs for the American auto manufacturers isn’t even a new story except to the brain dead like you. This was being reported even last year when the auto makers were doing battle with the UAW.
A year before that, it appeared on places like back in 2006 on Tom Paine as being $80 per hour per employee with benefits.
Not far back enough? How about in 2004? Hadn’t even begun to be a glint in your partisan eyeball back then, I bet. Too busy with frat parties to pay attention to what was predictably coming down the pike? Or perhaps you were still in high school then.
While you place your entire education portfolio of the auto financial status in the less than able hands of TNR, Missy and I both have relatives in the business. We’ve also both been around long enough to turn your hide over and tan it for your insolence, you pompous and arrogant cyberblowhard. But that’s another story.
My now deceased uncles were executives in Detroil with the auto industry. So I combine both multiple source quotes of their costs, combine it with personal experience… as does Missy… to come to conclusions.
And you? No doubt too busy playing beer pong with your buds to compile any research of substance other than where to buy a cheaper batch of replacement ping pong balls.
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Correction… let’s not give Yale a bad name for meathead. Apparently he’s a user of others’ proxy accounts. In other words, an arrogant geek with a ‘tude.
Mata, maybe “MeetnoBrain” is just the janitor at Yale… lol.
BTW, meathead… yes, they “averaged” Toyota’s cost per employee hourly the same way … tallying workers hourly wages and total costs of pensions, averaging it out to approx $48 per hour.
i.e. again from before this was on your political radar…. from Oct 2007 this Reuters article
Mata: You’ve got to stop spreading these “lies*!”
*otherwise known as facts.
LOL Mike! Just po’s me when these bozos show up and parse words… trying to twist facts in order to mask the obvious. ala pretending these figures were what every individual worker gets.
But then what can you do with the “it all depends on what the meaning of “is”… is” mentality that permeates this country. And that’s the game meathead is playing.
Mata: I know the feeling.
Next Meatpie will be telling us Obama had no contact whatsover with Blagojevitch.
Your union boss bargained with Congress in bad faith. They just want the cash now to hold them over until Obama signs card check into law. Then they will trot down south and inflict the same disease on the foreign auto plants and create the same mess we are dealing with now.
The TNR article the union bot is posting is not accurate. The hourly figure does *NOT* include current retiree’s benefits, it includes *FUTURE* retirement benefits for those who are presently working.
_____________________________________________________________
Earned Benefits
The remaining $33.58 an hour of hourly labor costs that GM reports–46 percent of total compensation–was paid as benefits. These benefits include[5]:
Hospital, surgical, and prescription drug benefits;
Dental and vision benefits;
Group life insurance;
Disability benefits;
Supplemental Unemployment Benefits (SUB);
Pension payments to workers pensions accounts to be paid out at retirement;
Unemployment compensation; and
Payroll taxes (employer’s share).
These benefits cost the Detroit automakers significant amounts of money. Critics contend that these benefit figures include the cost of providing retirement and health benefits to currently retired workers, not just benefits for current workers. Since there are more retired than active employees this makes it appear that GM employees earn far more than they actually do.*******************************
This contention contradicts the plain meaning of what the automakers have reported in SEC filings and in their public statements and would be contrary to generally accepted accounting principles.**************************
Under the accounting rules established by the Financial Accounting Standards Board, the Detroit automakers must report their liability for future benefits as they accrue.[6] The hourly benefits figure includes payments into defined benefit pension plans to provide future pensions to current workers. It also includes the estimated costs of future retirement health benefits that current workers earn today.****************************
Chrysler, for example, reports paying $20.14 an hour in health costs for its hourly employees. That figure includes the estimated cost of their health benefits in retirement, calculated according to Financial Accounting Standard 106.[7] The government does not allow Chrysler to promise to pay tens of thousands of dollars in health benefits in the future without reporting that cost on its balance sheets today.
***************Excludes Legacy Costs***********************
The hourly benefit figures the Detroit automakers report covers the cost of current and future benefits earned by actively working employees. It does not include the cost of paying health benefits and pensions to current retirees.*********************
Before they requested a bailout, the Big Three automakers specifically explained that their labor cost figures do not include the cost of past work. General Motors states in its filings with the Securities and Exchange Commission that:
GM maintains hourly and salaried benefit plans that provide postretirement medical, dental, vision, and life insurance to most U.S. and Canadian retirees and eligible dependents. The cost of such benefits is recognized in the consolidated financial statements during the period employees provide service to GM.[8]
In other words, GM records the expense for retiree benefits when workers earn the benefits, not years later when they collect their benefits. In less technical language, Ford explains that their total average hourly labor costs include:
(1) All the dollars paid to employees, (2) the cost of contractual benefits for employees, and (3) the cost of statutory payments, such as Social Security and Workers’ Compensation–all calculated on the basis of hours worked by employees.[9]
Average hourly costs include the costs of wages and benefits (current and future) to employees divided by the number of hours worked by those same employees. It does not include the benefits paid to retirees.[10] This is in accord with standard accounting principles that require the Big Three to report their costs as they occur. Labor costs are the costs to the Detroit automakers of employing its current workers, not paying former workers for services performed decades ago.
Retirement Benefits Alone Cost $31 an Hour
http://www.heritage.org/Research/Economy/wm2162.cfm
Stellar clarification, Missy. Many thanks.
No problem Mata, just had to remember where I saw the information. While making my morning rounds I noticed a few newbies posting pro union information in high traffic blogsites. In one comment section alone, out of 258 comments one guy repeatedly posted the same copy and paste and then added the auto manufacturers need to up the price of their vehicles and the problem will be solved, sheesh. I think these people are warming up the seats the Obamabots just left, before this is all over I expect the robo-calls to start rolling in.
This is all a distraction, just like the democrats trotting out the information about the foreign auto companies getting tax credits, failing to mention the big 3 get them too for various reasons. With 52% of the union auto workers NOT wanting a bail out, seems like all this isn’t playing yet in Peoria, but it probably will eventually if they keep up the misinformation campaign.
“Now I realize that you don’t want to include the costs of the retiree pensions since it messes up your tidy little perception.”
False. The cost of retiree pensions and health care cannot be included in the compensation received by currently active autoworkers because it is not paid to currently active autoworkers.
It’s a simple concept — so simple, in fact, that Mikey and his merry band of fellow liars prefer to pretend it does not exist at all. The claim made by Kudlow and others, and echoed by Mikey and the liars’ club here at Flopping Asshats, was that “Average compensation for the Detroit little three is $72.31”. That is quite simply false, because it includes benefits not paid to the workers now building cars.
The total costs of labor, including health benefits and pensions to retirees, may well average out to more than $70 per hour worked by current workers. But to claim that current workers are compensated to the tune of $70+ per hour is flatly and blatantly dishonest.
“BTW, meathead… yes, they “averaged” Toyota’s cost per employee hourly the same way…”
Irrelevant. The claim was not that “cost per employee hourly” was $70+ dollars per hour. The claim was that UAW workers are compensated at a rate of $70+ dollars per hour. That claim is a lie.
“The hourly figure does *NOT* include current retiree’s benefits…”
False. It is already well documented that this figure does, in fact, include the benefits paid to current retirees. It is also worth noting that the Heritage Foundation’s analysis are based largely on estimates — not actual costs — provided by auto companies in “fact books” issued during contract negotiations. Laughably, the Heritage Foundation can provide no documentation whatsoever for the claim that the benefits figure for Ford do not include retiree benefits — merely the alleged verbal confirmation from an unnamed Ford employee.
Further, the original claim made by the Heritage Foundation was that “UAW workers earn $75 an hour in wages and benefits“. Note the subtle change in this claim — now it’s “UAW Workers Actually Cost the Big Three Automakers $70 an Hour”. Why the change? Because it is now painfully obvious that this “cost” is simply an artifact of accounting, and does not represent anything near to the reality of how autoworkers are actually compensated for their labor. This is a consequence of FAS 106, an accounting method that requires companies to “employers must replace pay-as-you-go accounting with accrual accounting. That is, their balance sheets must show the expected cost of providing retiree health and welfare benefits for all employees and retirees eligible to receive such benefits, currently or in the future.”
Oops. The costs reported by the automakers in their SEC filings, in accordance with FAS 106, includes “benefits for all employees and retirees eligible to receive such benefits“. That pretty much settles the matter: the figures being touted by the Heritage Foundation and other far right pundits, derived as they are solely from information supplied by the automakers, are indeed padded with benefits for current retirees — but we are supposed to ignore this fact, and pretend that it’s those greedy workers gobbling up all the cash.
The willingness of the wingnuts to believe any lie fed to them by the right-wing noise machine is legendary. I thank my fellow commenters for again confirming their exceptional gullibility.
I left this reply to one of the Mike’s America readers who actually LIVES near Detroit and has to deal with reality, not the fantasy that Meatpie is pushing. It fits here too:
Wade: It’s far easier for poor diminished meatpie to go flinging around that LIAR label than it is for him to engage in an intellectually honest discussion of the problem here.
Now that President Bush has offered a big three a bailout (which reminds me… did we hear any praise from meatpie when Bush did that?) the problem will be held over until next year when Obama and the Dems can use billions more in taxpayer funds to shelter big union bosses from any accountability for the mess THEY made.
Notice that Mikey is entirely unable to specify what part of my arguments is “fantasy”, or provide any evidence to back up this claim. No, we are simply expected to believe that it is so Because! Mikey! Says! So!
Believe it or not, among wingnuts the fact-free assertion is considered a very high quality “argument”.
“we are simply expected to believe that it is so Because! Mikey! Says! So!”
Yes you are.
“Mikey” has already wasted enough time presenting FACTS which meatpie finds it convenient to ignore. “Mikey” has better things to do than argue with a fool who is simply trying to prop up the union bosses and prolong the agony of their workers.
@meatbrain:
There is a lot of bogus propaganda being put out there by the unions and the mass media with regards of the hourly wage of union workers as well as the hourly compensation of union workers as well as the hourly cost to the Big 3 companies of the union workers.
When all is said and done, from what I have read, there is a $10/hour gap between the compensation paid to the union workers (salary + benefits) compared to what the foreign companies pay their workers. Most of that $10 is in the benefits packages union members get. The foreign companies don’t pay benefits as high as the unions.
However, the cost to the Big 3 companies for each union member is much, much greater, and that is where the Big 3 are having major trouble competing financially with the foreign companies. Because the Big 3 have such a large retired force compared to the foreign companies, if one takes the amount of money each company must pay its employees — both active and retired – and divides by the active workforce, that is where the Big 3 end up paying $70+/hour per active worker compared to the foreign companies who are only paying about half that.
There is just no way to compete with that kind of cost/revenue discrepancy.
Either the benefits packages need to come down or the packages to the retirees must come down.
The last numbers that I saw were stated to be around $45/hour (salary + benefits) for the foreign company workers vs $55/hour (salary + benefits) for the UAW workers. And then the additional $15/hour/worker to cover the cost of retirees’ packages.
Something needs to give. The Big 3 cannot continue to compete when their pay gap is around $25/hour/active worker.
Also, upon talking to a coworker of mine who came to our job from previously being in the UAW, he said that the way the union works is based on entitlement, seniority and time in with the union, not based on merit. Also, no matter what, workers who bust their butts to do their jobs to the best of their ability are rewarded the same as those who slack off and screw off. And there is no incentive for anyone to do any better, because UAW workers are only rewarded based on time in with the union, not merit. They also won’t fire people based on lack of production.
To put it simply, the problem is that the union could care less about the Big 3 and could care less about their product. Their focus is only on making the most money and getting the most benefits, no matter the consequences and no matter whether they are getting results or not. It’s much like the Teacher’s Unions which are run the same way. No matter their performance and the performance of their kids, they don’t care, they simply want more money, more pay and more benefits.
At one time the unions served a good purpose, to stop companies from treating their employees poorly. But now, the unions have become so wrought with power and greed, that the pendulum of corruption has swung entirely the opposite way and the unions are ruining things.
We need to get back to a system of merit, not a system of entitlement. Workers should be rewarded for good work and punished — even fired — for lack of production and poor work. Until that happens, the Big 3 are going to continue to fail to compete with the foreign companies.
First time ive left an entry here but i have to agree with MICHAEL in MI at one time unions was a good thing , and im not saying all unions are bad , but it seems to me that all they are worried about are themselves and not the ones they are supposed to help protect …THE WORKER ……