The UAW Fights Its Image as the Villain of Detroit's Woes

[Renegade]

By Bill Saporito
Sunday, Mar. 01, 2009

It is particularly galling to the United Autoworkers that, in addition to
 numerous rounds of layoffs and givebacks dating back two decades, the union
 is being cast as the enemy in the U.S. auto industry's fight to survive. 
"Our contracts with Chrysler, Ford and GM represent only 10% of the cost of
 assembling of a vehicle. But most days, it seems like we get 110% of the 
attention," said UAW president Ron Gettelfinger in a recent speech. In the 
wake of GM's most recent quarter, in which the company lost $9.6 billion — 
$30.9 billion on the year — the fight is getting more desperate. So the
 union is back at the table again, negotiating more relief for the Detroit 
Three.

The UAW's image problem stems from the fact that it has been arguably much better at doing its job than the Big Three managements have been at theirs. Over the last 60 years, many of the benefits that both blue and white collar workers hold dear were won, or expanded, by the UAW. That includes pensions, early retirement, overtime, total healthcare coverage and paid holidays. At Congressional hearings in November over a proposed bailout bill, there was palpable contempt for the UAW from Alabama Senator Richard Shelby, whose state is home to several transplant automakers. To him, the UAW seemed to consist of a bunch of overpaid featherbedders who couldn't match hubcaps with workers at transplants like Toyota and Mercedes Benz, who did not enjoy the Big Three's gold-plated benefits.




That criticism has lost its bite with autoworkers, considering that Toyota and other foreign makers are taking it on the chin just as much as Detroit. "This 
attitude, targeting the UAW as the bad guy here or the reason the auto industry 
is in rough shape — they think that's unjustified, not warranted," says David Lipsky, Professor of Dispute Resolution at Cornell's School of Industrial and Labor Relations. And with some reason, says Lipsky, "They were innovative and creative: they built a comfortable lifestyle for middle class Americans. And now it's turned out to be a house of cards."




Faced with giving up benefits, the UAW will conciliate but not placate management, which strikes some Americans as uncooperative. But those so-called legacy costs, won fairly at the bargaining table, have big emotional value for the UAW. It's what behavioral economists call the endowment effect, says Litsky: The UAW values what it fought for — even much maligned work rules — much more so than workers who have never had them. So they are not going to give up anything without a fight. In mid-February, the union actually stormed out of negotiations with GM over reducing the company's retiree health care costs, as GM seeks to restructure costs with bondholders, suppliers, and, of course, labor.

The union has already made big concessions: the 2007 labor contract with GM transferred health care costs from the company to a union-run plan, and set 
up a lower wage structure for new hires. The company is asking for more 
because it has no other choice given the devastating drop in sales.





As Roger Lowenstein describes in his book, While America Aged, it was the
 remarkable UAW president Walter Reuther (1907-1970) who won womb-to-tomb healthcare coverage and retirement benefits for the rank and file. Reuther was an early advocate of universal healthcare coverage, which was not going to fly in Washington. So he willingly traded small pay raises for deferred 
compensation in the form of pensions and retirement healthcare. The Big
 Three gladly signed on because the tradeoff held down cash wages — and because they were lushly profitable companies, controlling 90% of the U.S. car
 market. Executives never conceived of a day they might run out of money. One 
result, though, is that GM, has paid out more than $100 billion in retiree
 and health care costs in the last 15 years, and is now facing $47 billion in 
future retiree healthcare payments.




Reuther, who was worried about rising healthcare costs as far back as the 
1950s, feared that the auto companies would one day not be able to meet 
their obligations. That that day is here is one reason the UAW made yet
 another concession. It reached an agreement with Ford to change the way the
 company contributes to the retiree health care fund administered by the UAW. 
Instead of cash, Ford now has the option of issuing stock to fund up to 50%
 of the Voluntary Employee Beneficiary Association, or VEBA. It means that 
the health of UAW members is tied directly to the health of Ford. "Our 
bargaining team stepped up to confront numerous challenges," said UAW Vice 
President Bob King, who heads the union's National Ford Department, in a 
statement. "They're to be commended for their hard work under difficult 
circumstances." Circumstances that only seem to get more difficult by the 
day.

http://www.time.com/time/business/ar...882376,00.html

[BirdGuano]

Adapt or die.

Lots of regular workers are giving up benefits and wages on a daily basis. Some for decades.

The UAW is about to go the way of the Dodo bird.

Reality bites. Wait until bankruptcy and their pensions
get federalized and they get 50% on the dollar, and no health care.

Ask the United Airlines mechanics how that worked out
for them.

Faced with giving up benefits, the UAW will conciliate but not placate management, which strikes some Americans as uncooperative. But those so-called legacy costs, won fairly at the bargaining table, have big emotional value for the UAW.

It's what behavioral economists call the endowment effect, says Litsky: The UAW values what it fought for — even much maligned work rules — much more so than workers who have never had them. So they are not going to give up anything without a fight. In mid-February, the union actually stormed out of negotiations with GM over reducing the company's retiree health care costs, as GM seeks to restructure costs with bondholders, suppliers, and, of course, labor.

[Fiddlerdave]

Originally Posted by BirdGuano

Adapt or die.

Lots of regular workers are giving up benefits and wages on a daily basis. Some for decades.

So what good is this economy? Many countries appear to be able to manage cradle to grave health care for all and basic real citizen safety nets, with plenty of well-to-do wealthy in the country.

Maybe our priorities, economic structure, etc. need some evaluation, with a reassessment of the "winners-take-all" paradigm as a route to national success, whch seems to be failing.

[frodo]

I thought that what was killing the car companies was the anachronistic American system of pension and healthcare arrangements. The idea that some future management is responsible for your pension and healthcare long after you have left the company, and that it stops if the company fails, is just insane.

[BirdGuano]

Originally Posted by Fiddlerdave

Many countries appear to be able to manage cradle to grave health care for all and basic real citizen safety nets, with plenty of well-to-do wealthy in the country.

Really ?

Name some.

[frodo]

All the Scandinavian countries for a start and Australia ain't far behind.

[BirdGuano]

Originally Posted by frodo

All the Scandinavian countries for a start and Australia ain't far behind.

You actually ARE that deluded.

[frodo]

Deluded? You are.

Internationalliving.com ranks you lower than any Scandinavian country and Australia on health.

The Economist Intelligence unit puts you Thirteenth overall, Australia is Sixth. Norway, Sweden, Denmark, Iceland, Finland are all ahead (but Iceland is set to take a tumble).

http://www.economist.com/media/pdf/QUALITY_OF_LIFE.PDF

Ireland 8.333 1 36,790 4 3
Switzerland 8.068 2 33,580 7 5
Norway 8.051 3 39,590 3 0
Luxembourg 8.015 4 54,690 1 -3
Sweden 7.937 5 30,590 19 14
Australia 7.925 6 31,010 14 8
Iceland 7.911 7 33,560 8 1
Italy 7.810 8 27,960 23 15
Denmark 7.796 9 32,490 10 1
Spain 7.727 10 25,370 24 14
Singapore 7.719 11 32,530 9 -2
Finland 7.618 12 29,650 20 8
United States 7.615 13 41,529 2 -11
Canada 7.599 14 34,150 5 -9
New Zealand 7.436 15 25,110 25 10
Netherlands 7.433 16 30,920 15 -1
Japan 7.392 17 30,750 16 -1
Hong Kong 7.347 18 31,660 11 -7
Portugal 7.307 19 19,530 31 12
Austria 7.268 20 31,420 12 -8
Taiwan 7.259 21 28,070 22 1
Greece 7.163 22 22,340 27 5
Cyprus 7.097 23 20,500 30 7
Belgium 7.095 24 30,660 17 -7
France 7.084 25 30,640 18 -7
Germany 7.048 26 28,250 21 -5
Slovenia 6.986 27 21,892 28 1
Malta 6.934 28 18,710 32 4
United Kingdom 6.917 29 31,150 13 -16
Korea, South 6.877 30 23,360 26 -4

The U.N. human development index: You get Thirteenth, we get Sixth.


http://en.wikipedia.org/wiki/Quality-of-life_index

1 Ireland 8.333
2 Switzerland 8.068
3 Norway 8.051
4 Luxembourg 8.015
5 Sweden 7.937
6 Australia 7.925
7 Iceland 7.911
8 Italy 7.810
9 Denmark 7.797
10 Spain 7.727
11 Singapore 7.719
12 Finland 7.618
13 United States 7.615
14 Canada 7.599
15 New Zealand 7.436
16 Netherlands 7.433
17 Japan 7.392
18 Hong Kong 7.347
19 Portugal 7.307
20 Austria 7.268
21 Republic of China (Taiwan) 7.259
22 Greece 7.163
23 Cyprus 7.097
24 Belgium 7.095
25 France 7.084
26 Germany 7.048
27 Slovenia 6.986
28 Malta 6.934
29 United Kingdom 6.917
30 South Korea 6.877

You did beat the French though.

Ain't the internet grand?

[BirdGuano]

Not half as deluded as you are using a wikipedia entry of a United Nations report as a reference source.

[Potemkin]

The question was to name some countries that "cradle to grave health care for all and basic real citizen safety nets, with plenty of well-to-do wealthy in the country."

All the statistics mentioned was to show how happy people RECEIVING loot. I don't see anything about there still being the opportunity to generate wealth or "plenty of well to do".

[Ought Six]

Shall we talk about the aging demographic, skyrocketing healthcare costs, plummeting revenues, and the sustainability going forward of the welfare states named above? No?

[frodo]

So no change is possible? The U.S. has the best dang system in the world and all them furriners are lying?

[Ought Six]

Debate, or do not, but stop baiting.

[frodo]

O-6, there are plenty of systems better than the one the U.S has chosen, deal with it. The main defect of the American system is that it shovels the liability for healthcare and pensions forward on to as yet non existent management and workers.

Most civilised countries work on an accrual or pay as you go principle that does not lumber future generations with open ended liabilities.

[Ought Six]

f:

"O-6, there are plenty of systems better than the one the U.S has chosen, deal with it."

First, the bloated, inefficient welfare state systems you describe are unsustainable going forward, and you know it. Deal with it.

Second, we did not "choose" the system we have. This mess accreted over decades, and it is equally unsustainable. Does that mean we have to go to a welfare state system that we could not possibly afford, as you advocate? That would be stupid.

Tort reform is one thing we desperately need to bring down costs. Another is a way to limit extraordinary end of life care that prolongs one's death instead of saving one's life. Standardized digital medical records is good idea, though putting them all in a government database is an outrageous violation of our privacy. Healthcare coops for small businesses, the self-employed and lower-wage workers with no bennies are a great way to make health care plans affordable for those groups. Bringing the illegal alien problem under control would remove a huge burden from emergency rooms especially. Bringing the government back within Tenth Amendment enumerated powers limitiations would remove the massive tax burden on our citizens and businesses, making people much more able to afford healthcare and allowing people and companies to dramatically increase charitable giving. All of these are things we could do without turning to an unworkable and unaffordable government mismanaged scheme.
----------

"Most civilised countries work on an accrual or pay as you go principle that does not lumber future generations with open ended liabilities."

You seriously believe that the welfare states in other developed nations are in the black ?!?

[frodo]

It's really interesting watching slaves telling you how free they are.

Your medical industry, doctors, hospitals, insurance companies, pharmaceutical industry etc. are screwing you blind. Yet you continue to believe that you live in the best of all possible worlds, and that everything foreign must be inferior.

It reminds me of that wonderful movie "Idiocracy", and the scene where the smartest man in the world tells the President and his cabinet that they should be using water on their crops instead of sports drinks - they just laugh at him and say "water is for flushing toilets."

Here is a hint : Anterior cruciate repair (ACL injury). When mine was done, total cost about $1700, and that included fixing a meniscal tear as well. $1000 of that was the surgeons fee, he does about half the footballers in this State. Same operation in USA at the time I am informed was $20,000.

This link now says an ACL repair costs $35,000 in America!

http://www.revolutionhealth.com/page...edical-tourism.


$1700 vs. $20,000 ? Doesn't that tell you something? For a one day in Hospital stay, about three quarters of an hour for the operation. Latest techniques? Man you are being screwed!

[Ought Six]

f:

"It's really interesting watching slaves telling you how free they are."

It is really uninteresting watching you try to bait people with profoundly stupid statements like this.
----------

"Your medical industry, doctors, hospitals, insurance companies, pharmaceutical industry etc. are screwing you blind. Yet you continue to believe that you live in the best of all possible worlds, and that everything foreign must be inferior."

Did anyone say "everything foreign must be inferior"? I must have missed it. Please provide an exact quote, so we know what you are talking about here.
----------

"Here is a hint : Anterior cruciate repair (ACL injury). When mine was done, total cost about $1700, and that included fixing a meniscal tear as well. $1000 of that was the surgeons fee, he does about half the footballers in this State. Same operation in USA at the time I am informed was $20,000. This link now says an ACL repair costs $35,000 in America!

http://www.revolutionhealth.com/page...edical-tourism.

"$1700 vs. $20,000 ? Doesn't that tell you something? For a one day in Hospital stay, about three quarters of an hour for the operation. Latest techniques? Man you are being screwed!"

Speaking of 'idiocracies', do you understand the difference between 'total cost' and 'the amount charged to you'? Are you really so incredibly clueless as to think you paid the full cost of your operation? Has it even occured to you that the taxpayers are picking up the bulk of the tab, and it is those 'slaves' who are owned and getting thoroughly screwed in your system?

[Fiddlerdave]

Originally Posted by Ought Six

f:First, the bloated, inefficient welfare state systems you describe are unsustainable going forward, and you know it. Deal with it.

Second, we did not "choose" the system we have. This mess accreted over decades, and it is equally unsustainable. Does that mean we have to go to a welfare state system that we could not possibly afford, as you advocate? That would be stupid.

Tort reform is one thing we desperately need to bring down costs. Another is a way to limit extraordinary end of life care that prolongs one's death instead of saving one's life. Standardized digital medical records is good idea, though putting them all in a government database is an outrageous violation of our privacy. Healthcare coops for small businesses, the self-employed and lower-wage workers with no bennies are a great way to make health care plans affordable for those groups. Bringing the illegal alien problem under control would remove a huge burden from emergency rooms especially. Bringing the government back within Tenth Amendment enumerated powers limitiations would remove the massive tax burden on our citizens and businesses, making people much more able to afford healthcare and allowing people and companies to dramatically increase charitable giving. All of these are things we could do without turning to an unworkable and unaffordable government mismanaged scheme.
----------You seriously believe that the welfare states in other developed nations are in the black ?!?

What an old and moldy list.

06 sez "First, the bloated, inefficient welfare state systems you describe are unsustainable going forward". Yet, somehow acording to 06, the USA, while NOT providing anything like the human services done in Europe, is going to collapse too!

So we look at countries where the middle and upper classes can change jobs or be unemployed without fearing lack of access to medical care, enjoying 6 week vacations and a fair amount of job security. Oh, well, 06 sez "they will fail". Someday. Fer sure. Believe the conservaties, they would never fabricate BS.

Of course, it is important we take away fom US citizens any recourse they have for injury from negligent or fraudulent businessess. If you get screwed over, you get to be On Your Own. Even though those states that have passed tort reform (like California medical) remain identical in prices paid and lack of access, we MUST shield businesses from paying the price for the consequences of their actions for everything to be OK. This is simply MORE BS.

All the things that are working just fine across the industrialized world we can't do because of ideology, and solutions that have never worked in the past here are what is supposed to fix the problems? Our healthcare system has a whole lot more wrong with it than illegal aliens, and the people at ER's going bankrupt are often the employees of some of our more wildly profitable corporations who somehow can't afford to provide healthcare. Many of these countries have LOTS of unions and compete well enough to outperform the USA while taking care of their citizens.

Human services systems in the black? I don't know, is our military "in the black"? The highway system? The wealthy farm subsidy program? The multinational ethanol subsidy system? There are activities that are the PURPOSES of a collective government and how they should be spending money for the most efficient way to benefit systems. Other industrial countries spend HALF the money for TWICE the health care service. Doesn't seem like a bad way to run a country.

[frodo]

First, the bloated, inefficient welfare state systems you describe are unsustainable going forward, and you know it. Deal with it.

= all foreign systems are inferior, "bloated, inefficient" since all the countries ahead of you on the indexes are "Socialists" and they have been keeping these systems going since WWII.

Speaking of 'idiocracies', do you understand the difference between 'total cost' and 'the amount charged to you'? Are you really so incredibly clueless as to think you paid the full cost of your operation? Has it even occured to you that the taxpayers are picking up the bulk of the tab, and it is those 'slaves' who are owned and getting thoroughly screwed in your system?

I can't believe that you cannot get this through your skull. No Government money was involved - THE TOTAL COST WAS $1700 at the time. It will probably cost over $3000 today but your cost is apparently $35,000 today!

This operation was performed at this private hospital :

Warringal Private Hospital is an acute medical/surgical hospital providing healthcare for the north eastern and Greater Melbourne community. It has been a leading provider of healthcare for this community for over 30 years achieving national and international recognition in many fields. With 143 beds, the hospital is conveniently located close to public transport and directly across the road from the Austin Health Campus and Mercy Hospital for Women. The Hospital is owned and operated by Ramsay Health Care.

by this surgeon:

John Bartlett specialises in surgery of the knee especially relating to sports injuries and arthritis. He is an Executive Board member of the International Society of Arthroscopy; Knee Surgery and Orthopaedic Sports Medicine (ISAKOS); and a Life Member of the Australian Knee Society; Arthroscopy Association of North America (AANA); European Society of Sports Medicine, Knee Surgery and Arthroscopy (ESSKA) and the Asia Pacific Orthopaedic Association. He is Chief Australian Delegate to the Asia Pacific Orthopaedic Association, Asia Pacific Orthopaedic Society of Sports Medicine and the Asia Pacific Knee Society.

It's not about financing, you can't wriggle out by talking about "inferior doctors or backward hospitals" it's about how your medical system is robbing you blind!

[Ought Six]

f:

"= all foreign systems are inferior, "bloated, inefficient" since all the countries ahead of you on the indexes are "Socialists" and they have been keeping these systems going since WWII."

So you are going to completely ignore the demographics issue, and pretend it does not exist. Okay, if you refuse to even acknolege, much less debate the facts, then we have nothing to talk about.
----------

"I can't believe that you cannot get this through your skull. No Government money was involved - THE TOTAL COST WAS $1700 at the time."

How could I "get through my skull" what you did not say? You just said the procedure was done. You did not say it was not done within the government healthcare scheme you have in Australia. I guess you require people to have ESP to know all about the facts you fail to provide.

So how long ago was "at the time"? Was any sort of health plan involved, or was this 100% paid for out-of-pocket?

I find it interesting that you say you had to pay for your ACL repair entirely by yourself. Why is that? The Australian government subsidizes most procedures done at private facilities. An injury such as yours certainly would qualify. So why did you pay the full price, not the government subsidized price? Or were you just paying the government subsidized price without even realizing it?

================================================== ===========

Dave:

So you are denying the massive and well-known demographics problem in Europe as "BS made up by conservatives"? Is that an argument you seriously intend to make and defend?
----------

"Many of these countries have LOTS of unions and compete well enough to outperform the USA while taking care of their citizens."

Are you talking about just health care, or in the general economic sense?

[frodo]

O-6, the surgeon who did the operation received $1000 from me and nothing from anyone else to do that operation.

The hospital received $700 from me for my time there. That is all. I can't remember if I claimed it against private medical cover or if I even had cover then.

But the point is that there is no secret subsidy of $18,300 dollars provided by "Socialists" that makes the cost the same as in America.

Here is an entry in a medical forum from last year: http://www.delphifaq.com/faq/household/f916.shtml?p=6

Im american living in Australia the surgery total cost 3700 dollars and thats one of the best surgeons in Australia does pro athletes.

What I am trying to get through your head that the American healthcare system was charging Americans over ten times what I was paying, and it appears it still is.

It's the same as your drug costs. Your drug companies sell the same things they charge you an arm and a leg for at a fraction of the cost in poorer countries, or countries like Australia that do subsidise certain drugs, but demand and receive a healthy discount from the manufacturers as well.

[Ought Six]

f:

Your medical system subsidizes medical procedures at private facilities. An injury like yours, as I said, would certainly qualify. So you paid $1700, and the hospital billed the government; i.e., the taxpayer; for the rest without you having to do anything. The price structure for those covered procedures are also fixed by the government. That is how your system works.

So it is not that we Americans are getting so ripped off. It is that with your procedure, the ripoff was spread out between you and the taxpayers in general.

[frodo]

No O-6, that was not the case, somebody tell him he is dreaming.

[Ought Six]

f:

This explains it:

http://en.wikipedia.org/wiki/Health_care_in_Australia

Excerpt:

Where the Government pays the large subsidy, the patient pays the remainder out of pocket. In some countries, this is commonly referred to as a copayment. Where a particular service is not covered, such as Dentistry, Optometry, and Ambulance transport[3], the Patient must pay the full amount (unless they hold a Low Income Earner card, which may entitle them to subsidised access).

Knee surgery for a torn ligament would certainly be a covered procedure. You paid $1700, and your private clinic likely billed the government for the rest. That is why is was so cheap.

[frodo]

I'm tempted to swear here. What you are saying is BS.

The price of a knee reconstruction at the time was $1700 all up. any person, any country just roll up. The price at the same time in the USA was $20,000.

Information current at 2008 indicates the price in Australia is now $3700, compared to $35,000 in America.

I find it bizarre that instead of querying the costs in the USA, you prefer to argue that the costs are too low in Australia because they are secretly subsidised by some sort of socialist system. This is the reverse of normal argument where you argue that prices in such countries are too high.

As I said, it's funny to watch the slaves argue that they are really free.

To put it another way, look up "medical tourism."