NPR’s Steve Inskeep: “You have no intent, and, in fact, not even the ability to remain major shareholders of two major auto companies?”
UAW President Ron Gettelfinger: “That’s correct. We do not have the ability because of the need for the cash in the VEBA.”
Inskeep: “Are you optimistic that Chrysler is going to emerge from bankruptcy in a long-term viable form?
Gettelfinger: “First of all, we did everything we possibly could to keep Chrysler from filing for bankruptcy. We did our part, and we’re not responsible for them being in bankruptcy . . . ”
Welcome to the new Chrysler ownership. And unlike Cerberus they’re not even pretending they’re in it for the long haul. But to whom will they sell? Listen to the whole story here.
20 Comments on “Gettelfinger On UAW/VEBA Ownership Of Chrysler...”
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Well that’s a shame. We radical free-market types have nothing against the union owning and running the company, so long as that isn’t a cue for yet more taxpayer money. In fact, that’s one way of trying to resolve the ridiculous breakdown of relations and trust between labor and management. If the UAW owned and ran the company, perhaps we’d be able to find out which union regulations were hamstringing the company and which weren’t. At least the incentives would be better lined up.
Why is the UAW so eager to put the company in some other
sucker’sowner’s hands?Even Gettlefinger doesn’t think that GM can avoid chapter 11. Shows how much faith he has for his employers.
Who else will they sell to? The obvious (and painful) answer is that they will sell to their other “partners” i.e. you, me and every other taxpaying citizen. What a clusterf@%*!!!!
@ johnthacker:
The UAW doesn’t have much of a choice. It’s either gamble it in Fiat’s hands or lose the VEBA money outright in liquidation. In which case, not only will they have a bunch of stiffed retirees, but scads more permanently laid off workers.
Wait a minute, did I just defend the UAW? Hell is freezing over.
Inskeep: “Are you optimistic that Chrysler is going to emerge from bankruptcy in a long-term viable form?
Gettelfinger “First of all, we did everything we possibly could to keep Chrysler from filing for bankruptcy. We did our part, and we’re not responsible for them being in bankruptcy…”
What a statement. And to think we have to subsidize these arrogant slugs for the indefinite future.
What a Country!
Good to hear he thought this through! Maybe he thinks he can sell the UAW shares to Fiat. That would be a mistake.
Love this quote: “We did our part, and we’re not responsible for them being in bankruptcy…”
Riiiiight.
Will the entity that is UAW/VEBA have to file bankruptcy if it cant meet the payouts to retirees for benefits, etc? When the Titanic that is UAW/VEBA craters from inevitable financial strain what will the process be to release itself from benefits payments?
If the VEBA is even remotely well managed, I expect a relatively slow and controlled flight into the ground. As the thing becomes more difficult to finance, the health plans will be less gold-plated, the co-pays and such will go up, and the workers will be paying more out-of-pocket or turning to Medicare and such more often.
I assume that since the whole purpose of the VEBA was to get these legacy costs off the automakers’ balance sheets, it will be difficult to tap them for money if/when the VEBA runs out. I also don’t know what kind of appetite the taxpayers will have if the VEBA goes to Congress hat-in-hand.
While there was some sort or argument in favor of Chysler and GM government bailouts, centering around preserving going-concern value and blue-collar jobs in an unusually tough market (and a promise, at least on paper, of recovering what the treasury put in), just throwing money at old folks, who could otherwise just rely on social security, medicare, and their savings (like the rest of us) seems even less palatable. But old folks do vote, so hey, who knows?
Publicly traded automobile companies (like GM and Toyota) have by definition diffuse and transient ownership. That’s the whole point. I don’t see a fundamental problem with the VEBA doing an IPO of New Chrysler to try to raise some money — if the market will bear it. Sure, it could flop, and the VEBA might just run to Congress or Fiat or a hedge fund or somebody and try to get a sort of private sale of equity done (at generous terms, of course). They could, in theory. If and when such a thing is proposed to our government, then (and only then) it’s time to start complaining that “we, the taxpayers” are on the hook again.
I would feel better if Team Obama just stroked a check for $1billion directly to VEBA and bought plane tickets to China for the UAW’s organizers.
If Team Obama wants to burn cash on bridge loans to nowhere, I’d appreciate it if they’re just honest about it.
“Why is the UAW so eager to put the company in some other sucker’s owner’s hands?”
It is easier to steal cash.
What’s all this about stealing cash? The UAW earned every last penny of what they are owed. They’re no less deserving of it than Chrysler’s bondholders who purchased the bonds at pennies on the dollar, bought credit default swaps, and are now trying to force Chrysler into Chapter 7 so they can collect in full. Its possible that a Chrysler C7 could lead to another bailout of AIG.
Ultimately the only real alternative is going to be to nationalize health care in this country. It is just too expensive to do anything else.
VEBA’s have a nasty habit of going broke…. Hello Detroit Diesel and Caterpillar. The UAW knows this – we’re not telling them anything here.
VEBA Fun Fact!
For a preview of what’s to come look here…
The VEBA would be an excellent opportunity to show what a better kind of health care plan could do. Apply basic preventative medicine and universal care like the liberals say should dramatically reduce health care costs, and they’ll be able to keep everyone healthier than the rest of the nation at less cost.
Or they can run it into the ground and then ask the government for a bailout “cuz health care is so expensive!”
Since #2 is a lot less work, I predict that’s the path to be taken.
AG :
May 1st, 2009 at 12:33 pm
What’s all this about stealing cash? The UAW earned every last penny of what they are owed.
Ever here about the Teamster’s Pension Fund? The members won’t be stealing cash, it will be the leadership.
UAW wants the money, preferably without a job or work attached to it, but will pretend to work if they absolutely have to.
Just more fighting over scraps. The “shares” would be worthless.
There is no equity, the dealer network will be ravaged. It will take the judge months just to hear each stakeholders perspective.
I’m a retiree, I’m the most important.. I will die without medication.
I’m an active worker. They can’t make product without me…
I’m a supplier, I’m the most important, they can’t engineer or make product without me.
I’m a bondholder, I have a legal claim which is more than any of these other schmucks.
And on and on and on…..
Imagine that the judge takes a few shortcuts, there would be quick and easy grounds for a retrial. That would do wonders for the “shares”.
People don’t understand that this is a court. They don’t care much about the date or time. If you think I’m wrong, go volunteer for jury duty.
The word of the day is CASHTRATION. Let’s use it in a sentence boys and girls…
“When a massive/complex company runs out of a steady stream of income, the company will be CASHTRATED”
The only thing Obama could have done to prevent this would have been to commit X Billions every month until Chrysler would regain sales. He didn’t….
Dear UAW,
We regret to inform you that we’ve had a change of heart and we’ve decided to not to purchase any further stake of ownership in Chrysler. We trust that you will find a suitable buyer for your worthless shares so that your organization doesn’t also go bankrupt. We hope there’s no hard feelings.
Yours sincerely,
FIAT
The only thing Obama could have done to prevent this would have been to commit X Billions every month until Chrysler would regain sales. He didn’t….
Is that certain? Has Obama definitively said that this is it, no more $$$.
I don’t think it is. I’m expecting that the collection plate will be passed around again in the fall.
After all, we wouldn’t want the taxpayers to lose on their ‘investment’.
@paris-dakar
I was referring to preventing the bankruptcy filing. The only way Obama could have prevented Ch. 11 would have been the commitment to meet ALL of Chryslers obligations every month until they found a way to restore decent cash flow.
He choose not to do that… Now the judge is in charge with heavy dose of input from the government since they are funding the bankruptcy.
I was referring to preventing the bankruptcy filing. The only way Obama could have prevented Ch. 11 would have been the commitment to meet ALL of Chryslers obligations every month until they found a way to restore decent cash flow.
He choose not to do that… Now the judge is in charge with heavy dose of input from the government since they are funding the bankruptcy.
In the narrow sense, you’re probably correct. I still don’t think the taxpayer has seen the last of this mess.
Never pay the Dane Geld.