Bailout Watch 218: Gettelfinger Blackmails Congress

by Edward Niedermeyer

Published: November 18th, 2008

bailout watch 218 gettelfinger blackmails congress

UAW President Ron Gettelfinger is joining Detroit’s two-day testimonial of shame in Washington DC today, and in case there was any suspense about what he would say, he leaked his notes to the Detroit News. The shameless audacity of his position shouldn’t come as a surprise, given his (and his organization’s) track record. Still, it might just take your breath away a little. Step one on the Gettelfinger formula for success, prove that the D3 are going under. Not hard. Step two, refuse to do anything about it. “We do not believe there is any justification for conditioning assistance to the Detroit-based auto companies on further deep cuts in wages and benefits for active and retired workers. We would also note that in the cases where the Treasury Department has acted to rescue financial institutions, it has only imposed restrictions on executive compensation. It has never mandated cuts in wages or benefits for rank-and-file workers and retirees. Thus, there is no basis for singling out the auto industry for different treatment,” says Gettelfinger in his prepared remarks. Step three? Blackmail, baby.

Exact details of Gettelfinger’s threats to congress have been partially paraphrased by the DetN, but the message is clear. “The liquidation of the Detroit-based auto companies would have devastating consequences for millions of retirees, Gettelfinger’s remarks said. A failure of the pension plans of the automakers could require immediate government intervention and a shifting of those responsibilities to the Pension Benefit Guaranty Corp, or PBGC. To ‘prevent the collapse of the PBGC, which would jeopardize the retirement security of millions of workers and retirees, the federal government would have to provide a huge bailout for the pension guarantee program. Furthermore, under existing law, the federal government would be liable for a 65 percent tax credit to cover the health care costs of pre-Medicare auto retirees costing about $3 billion per year.'” In other words, Gettelfinger seems to think he’s got congress by the short hairs, and he clearly doesn’t mind giving them a gentle shake.

Not that Gettelfinger doesn’t care about the taxpayer. “As with other rescue efforts under this program, the bridge loan to the automakers would be conditioned on stringent limits relating to executive compensation, as well as provisions granting the federal government an equity stake in the auto companies in order to protect the investment by taxpayers,” he tells congress. Besides, “We recognize that President-elect Obama campaigned on a platform that included increases in fuel economy and the production of plug-in hybrids, as well as assistance to the auto industry to ensure that the vehicles of the future are produced in this country. The UAW is looking forward to working with the Obama administration and the next Congress to help achieve these objectives.” Almost as much as Gettelfinger is looking forward to telling his membership that they don’t have to give up a red cent to have their hapless employers bailed out. Wrapped in green or red, white and blue, Gettelfinger’s venal self-interest is still just that.

Edward Niedermeyer

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Geeber on Nov 19, 2008
psharjinian: The point is that the opportunity for the average person to earn a wage that was more or less at functional parity with that of thirty to fifty years ago is gone. Those opportunities still exist. The UAW never had a monopoly on those jobs, and, if anything, the union's continued existence relied as much on the unsustainable Jobs Bank and a truck boom that put off the inevitable day of reckoning for the Detroit Three. Saying that middle class jobs will disappear with the UAW has as much credibility as saying that we won't be able to buy a new car if GM goes under. psharjinian: And yet we’re actively cheering for the destruction of the empowered through questions like “Why, if the “average” worker outside of UAW shops doesn’t make UAW money, should anyone?”. And that’s the wrong question to ask. Most of us aren't asking that question. Instead, we are asking why we should be expected to subsidize through our tax dollars jobs that have no reason to exist, because the demand for the product the workers make does not exist. Or, at least, said demand doesn't exist in quantities sufficient enough to ensure employment at current levels, and customers clearly aren't willing to pay a price high enough for the product to allow companies to subsidize the Jobs Bank. The union wants government aid because it knows the real answer to the dilemma faced by GM and Chrysler (not so much Ford) is a reorganization that involves shutting down factories, divisions and dealers. All of which will result in a major reduction in the number of both white-collar and blue-collar employees. psharjinian: The question we should be asking is “Why are we allowing the middle-class wage erosion to occur?”. The UAW members make wages above most middle class Americans. And please note that the workers at the transplant operations make solid incomes. They aren't making the minimum wage, despite the hysterical claims of the UAW and its supporters. psharjinian: It’s a disturbingly American attitude: to begrudge collective prosperity because of individual bitterness. What I see is a spoiled union demanding that people who had nothing to do with Detroit's demise step up to the plate so that it can pretend that it's still 1965. I don't care if UAW members make $200,000 a year and have four months of paid vacation. If their company can afford it, good for them for grabbing as many golden eggs as the goose can lay. But when times go bad, it's not my responsibility to ensure that UAW members can live in the style to which they have become accustomed. The UAW reminds me of a teenager with wealthy parents. He had the best of everything because mom and dad were rolling in the money. Which was great while it lasted. But now mom has lost her job, and dad took a cut in pay, and said teenager expects ME to step up and allow him to continue living the good life. carlos.negros: You can’t compare Detroit with cars built in Germany, Japan, or Canada. We don't have to. We can compare their cars to cars built in Alabama, Indiana, Kentucky, Mississippi, Ohio, Tennessee and Texas by the transplants. Employees at these facilities receive health care coverage through their employers. carlos.negros: Get this: People there pay very little for health care or college. They pay through their taxes, and everyone who can afford to do so supplements their coverage with private insurance. And their colleges and universities, with few exceptions, tend to be worth about what they cost. The U.S. is still the leader in higher education, precisely BECAUSE its universities and colleges are relatively expensive and not open to just anyone.

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Landcrusher on Nov 19, 2008

Cut military spending in half? 41 cut military spending much less than that and nearly destroyed the army. The only place to save money is by cutting troops. Troops are all trying to retire because without retirement benefits it's stupid to stay in longer than a single tour. You can't get away with it again any time soon.

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