Friday, July 27, 2007

Quote of Day: Unsustainable Lavish Expectations

UAW workers still enjoy a health-care deal that no one else in America or Japan -- or quite possibly the planet -- does. Yet Mr. Gettelfinger said last week that the 2005 health-care givebacks were the toughest decision he ever made in his entire career. This is a startling admission that reflects the depth of the UAW's entitlement mentality, and its detachment from the world that its fellow Americans inhabit. But such lavish expectations are unsustainable under any system -- American or Japanese. This is a reality that Mr. Gettelfinger must accept. Otherwise, he may well push U.S. auto makers over the cliff -- and his comrades with them.

~Shikha Dalmia in today's WSJ editorial "The UAW's Health-Care Dreams"


At 7/27/2007 11:38 AM, Anonymous Anonymous said...

I noticed that the author did not mention that the UAW has a signed health care agreement with GM that terminates September 14, 2011. Also an additional omission--the UAW has diverted almost $2 an hour from COLA since 1976 to pay for benefits. Assuming a 2080 hour year (40 hours x 52 weeks), that’s another $4160 per year the union members pay on top of the $1 per hour that was mentioned in the article.

Although UAW/GM health care costs (and other post retirement benefits (OPEBs)) are currently in the news, with the new accounting procedure GASB 45 applying to the public sector at the end of this year, more attention will have to be focused on how to pay for the baby-boomers’ retirement costs. This is not just an autoworker “greed” problem. A lot of people wish it were that simple.

Biased and sensationalist writing might sell newspapers and magazines, but it removes the attention from the real problems of shifting demographics and people who are enjoying longer lives that must be paid for from some source. The sooner that the problems are recognized as a national problem instead of an isolated problem in one unpopular sector of the economy, the sooner people will deal with the real dilemma. Pointing fingers at another person is rarely a viable solution to a complex problem.

At 7/27/2007 12:54 PM, Anonymous Anonymous said...

The article misses the point that Gettelfinger, as an elected representative, does not dictate the final decision. Remember that last years concessions only passed by 51% within the UAW @ Ford. Any changes that to be made must be made gradually, simply parading these figures around will not force UAW workers to increase their healhcare spending several times over. Also, many of the healthcare benefits were accrued in the place of salary increases, if the costs are too high management deserves a large portion of the blame for its shortsightedness. While its easy to hope for a quick fix, the big 3 will need to approach these negotiations with a more realistic approach.

At 7/27/2007 1:41 PM, Anonymous Anonymous said...

". . . if the costs are too high management deserves a large portion of the blame for its shortsightedness."

Yes, but blaming management won't help the problem, either. If the automakers are to stay in business, the problem still has to be addressed. Bankrupt companies can’t provide security for employees.

In reality, though, GM doesn’t operate any differently than the public or government with their “have it now and worry about paying for it later” mentality. Private credit card debt along with governmental Social Security funding problems and the federal deficit are the same types of problems. It’s not just “greedy” union members expecting “entitlements” that’s the problem here, but envious readers of these types of articles don’t always see through the smokescreen of the professional authors spewing their venom to sell papers. It’s politically correct to bash union members nowadays, and that’s a whole lot easier than a thorough examination of all the facts.

At 7/29/2007 11:49 PM, Anonymous Anonymous said...

Mark, is it that american can't take care of it's own or doesn't want to ???

Russo documentary says the FED is a private company and the collective taxes paid last year doesn't cover the interest (profit) of the fed??? You are the man... Does the product of American workers provide enough for "lavish" care and retirement??? Only guys like you know.



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