The world's second largest automotive parts supplier declared bankruptcy on Saturday.

Delphi Chapter 11

In addition to selling off factories, they will cut their workforce substantially and severely reduce pay for those who are left.

The questions for debate.

1. Does this major business failure indicate the end of unions like the UAW?

2. How can a union dominated business compete in today's global economy?

3. What lessons are to be learned from this bankruptcy?

1. Does this major business failure indicate the end of unions like the UAW?

You suppose with this question that it is the Unions fault for this- when it is pretty obviuos it is management's mis-management- again, as usual with ALL those backruptcies listed- that is why I was so angry at the last bankruptcy bill- we worry so much that the little guy may be "getting away" with something- when all the board members of this company got a raise the day before the filing- So LH- I suppose you have no problem with the fact that those fine examples of human offal got away with a monster pay raise- and I bet they could pay over 1000 employees with the CEO and his vice prez's raise- the problem here is there is no check or balance in CEO power or corruption- and this is another prime example of neccesary reform for boardrooms.

The bankruptcey bill should have included total liquidation of all board members worldly holdings- everything including thier personal homes and clothing.

I am serious- there is no sanction whatsoever in bankruptcy today for big business- we ruin a guy with bad medical bills and no medical insurance for life, but we let these scumbags off without any sanction whatsoever- in fact, they get a raise for their incompetence!

2. How can a union dominated business compete in today's global economy? Check out Germany being the number 1 exporter despite higher wages than us and massive union presence- you can not only COMPETE when you are union- you can win HANDS DOWN- a well trained Union employee is completely loyal to his company and buys thier product (when it is in thier price range, I have a union friend that makes yahts- he cant afford to own one, but takes great pride in them LOL)

3. What lessons are to be learned from this bankruptcy?

That we need massive reform in the publically traded board room- and sanctions, very stiff regulations and sanctions- against board members for this kind of action. As it is right now, it is a "get out of jail free" card for corporations- if you or I declare bankruptcy- it harms us, it is not a good thing- for corporations, see Kmart for instance, they can not only declare bankruptcy- they get financing to buy a larger company (they bought Sears for I believe it was 11 billion!!!) - How many of us get to declare bankruptcy one day and buy a bigger house the next?

I think even you can see some injustice in this, can't you LH?

I say jail all the board members and thier families, until all thier assets and everything they own is liquidated, then they can go back to the board room in sack cloth and ashes! They should have all funds for the rest of thier life garnished as well, and be forced to live on no more than a welfare mom is allowed. Seriously- they need this kind of law to prevent this kind of abuse of power.

1. No.

2. By working with the union in a open, honest and realistic manner. That didn't happen here in the case of Delphi. Demanding wage concessions that would reduce the workers hourly wage from $26 to $30 an hour down $12 or $10 is insane. Slashing wages by more than half is a hit few workers would be able to handle.

On the other hand, Delphi actually improved the severance package for 21 senior executives from 12 months to 18 months and a portion of their bonus. Nice to see Delphi executives are willing to share the pain they're inflicting upon their workers.

3. Well, it's just another reason added as to why some type of national health care is needed in the United States. The cost of health care is incredibly burdensome to business and they need some kind of relief.

From Mr. Miller's perspective, and in the view of many financial analysts, the company cannot continue to support the high cost of paying its United States work force.

"There are all kinds of things other than just wages that need to be dealt with here," Mr. Miller said in a recent interview.

The domestic auto industry faces the same kinds of labor problems that have bedeviled airlines and steel companies, with too few workers trying to support too many retirees, and too many workers being paid for not working. Health care costs are an increasingly onerous burden. G.M. pays $1,500 in health care costs for every vehicle produced in the United States, exceeding the cost of steel, while rivals like Toyota of Japan have nationalized health care at home and support very few American retirees.

http://www.nytimes.com/2005/10/09/business...artner=homepage

As to be expected, lordhelmet places all the fault for Delphi's bankruptcy on the heads of the labor unions, but that is far too simplistic an explanation for the crisis in the auto industry. Pressures placed upon the automakers by the union certainly play a part in their dire state, but there is no way to absolve the mistakes, incompetence and failure of senior management.

It's a cowpie sandwich and everybody's going to have to take a bite but it wasn't just the unions that created this mess. Nice try though LH at passing the buck and trying to play "the blame game."

First, a little background before answering these questions:
I spent half my life as a union electrician (before getting into engineering) and many years as a maintenance supervisor over union skilled trades. After moving into manufacturing engineering (a short stint), I was a union production supervisor.

The other half of my life was spent outside the union atmosphere, so I have a good taste of both sides of the fence at different regions of the country.

Lastly, Dayton is a GM town. Delphi is a huge part of the Dayton workforce. Many of my friends and family works for GM and/or Delphi. I hear their stories everyday and know as much as what goes on inside as many workers. I know their new lines, production rates, shutdown dates, etc.

With all that being, said, I wouldn't lose a minute's sleep if they shut them all down. To be clear, I wouldn't wish unemployment on anybody, but if it were going to happen, it couldn't happen to a "nicer" bunch. In all my years, I've never heard "GM" or "Delphi" (synonymous names in this area - even though GM sold it off, it's still recognized as GM) come out of a workers mouth without outright contempt. Although I'm sure they exist, I've never heard one decent comment about GM/Delphi ever come out of their mouths. Each act as if they are owed that job and consistently whine about their work hours and "crappy" benefits. when they say GM/Delphi, they practically spit it out.

Friends have taken me to their open house to show me where they sleep. Many don't do a minutes work for a week at a time. I've played retirement parties where the retiree has his pictures of worktime nap plastered all over the place as a joke. And finally, I believe their cars are junk. They sold me a lemon and almost drove me bankrupt in weaseling out of every warranty issue imaginable.

Every union shop I've worked in was basically the same. Unlike non-union shops, they only work when told. Otherwise, they read papers and take naps. I've worked them like that in Maryland (where I was born and raised) and Ohio. As a maintenance electrician, I had grievances filed against me for doing trivial tasks that could be construed outside my trade. I could replace the motor, but couldn't touch the belt - that was a machine repairman. So, I'd have to find one, write a work order, and take an hour to get something done I could have done in 5 minutes. GM has the same problem. It takes 2 to 3 tradesman to change out one motor (as one small example).

When I was a supervisor,it made meeting schedules and rates very, very difficult. Nobody wanted to work and nobody wanted to show up. It's not even like we're working for the same company. The workers work for themselves and it's up to the company to provide for them. It's simple animosity between management and workers there. Nothing more and nothing less.

So, in summary, I have nothing but complete disdain for unions and everything they currently represent. Before there was a National Labor Relations Board (an entity as powerful as any union in many cases), the unions served a necessary purpose. But after many years, much legislation, and protection agencies created to help any worker, they've become obsolete. They only protect the lazy. I never wanted to be part of a union, but had to. I called it extortion - they did nothing for me.

So now, the problems they've created have come to roost. If they worked like they got paid, there might not be that much of a problem. But they don't. Dayton's main problems are two-fold. One is worker's comp costs. That's not GM/Delphi's fault. The other is manpower. They have too many extra bodies because of people absent. And the ones that do show up don't work. The one's on the assembly line do ok as they have no choice - they need to keep up with the line. But many of the forklift drivers, maintenance guys, support personnel are dead weight. And we are paying for them in the car price.

1. Does this major business failure indicate the end of unions like the UAW?
Yep. I really think it does, and good fricken riddance. No non-union place would ever operate like a union house and stay in business. Most businesses cannot absorb those types of losses and/or just increase the cost of the product to pay for it.

2. How can a union dominated business compete in today's global economy?
It can't. Good, hard workers are hard to find anywhere in America. If you are hard working anywhere in the world, you don't need a union.

3. What lessons are to be learned from this bankruptcy?
The world has changed. Status quo is not a good business model. You can only compete by building better and cheaper product. Adding dead weight does not advance that cause. And a union is simply that - dead weight.

1. Does this major business failure indicate the end of unions like the UAW?

It may possibly indicate an end for unions as they are now. However, unions came into existence out of a need for protection from management that exploited the rank and file. Should similar conditions resurface, it seems logical that labor will once again organize.

2. How can a union dominated business compete in today's global economy?

By having politicians protect American jobs once again and strive to correct the trade deficit. When everything we buy comes from China, it is hard for American business to compete, period. And that is regardless of whether the company in question has union employees or not.

3. What lessons are to be learned from this bankruptcy?

In view of the fact that the planners (that is, management and not union workers) failed to read the market trends and run their business accordingly, I feel no lesson has been learned by Delphi. Instead, they are seemingly rewarding their executives with fat severance packages while screaming poverty to their hourly employees and creditors. How hypocritical.

I say all of this while acknowledging Dayton Rocker's experiences with lazy union employees. Not all union employees, however, demonstrate deplorable work habits any more than all salaried employees want to ship jobs off to India or Mexico.

1. Does this major business failure indicate the end of unions like the UAW?

Not any more than the major failings of the telecommunications industry indicated the end of capitalism. Those major companies were not unionized, just headed by crooks.

2. How can a union dominated business compete in today's global economy?

I give. How can any American company compete in today's global economy?

3. What lessons are to be learned from this bankruptcy?

The buck stops at management. Don't invest in crooked operations. We are in a ship of fools. Figure out how to make a buck on your own. The American standard of living is on the downswing. Get yer head out of the sand, this ain't 1984.

Personal comments directed at other posters removed. -Amlord

So, I'll just answer the three questions and clarify my positions.

1. Does this spell the end for unions like the UAW? This major business failure is a major blow to unions like the UAW, no question about it. I suspect the impact will ripple through the other major supplier Visteon (who is in trouble also) and also through the big three who are losing money as well. The major issues are wages, pensions, and health care. This event will start a chain reaction over the next several years I believe.

2. I don't believe that a union dominated industry can compete unless the unions realize what the new reality is and reform their way of doing business. To date, the unions have existed to get the workers the maximum that they can from the company. In many cases, they have succeeded short-term but long-term have lost everything (see NWA mechanics union).

I am all for a strong middle class in this country. And I'm for it out of economic concerns; 74% of our economy is related to "consumer spending". If the mass of people in this country don't go out there and buy all those toys, our economy will suffer a downturn. But, the union mentality that wages and benefits are a one way street and the outdated us vs them mentality where management is the enemy, the workers must be protected even when sleeping or intoxicated on the job, and the "do nothing" attitude that has infected the ranks in union after union must be changed in order for unions to avoid extinction.

It can work. However, it will take a progressive mentality from people who have been in lockstep with the current reactionary political party in America (the democrats). And it also takes a different mentality from the "profit at all costs" management and it requires government to take a broad view at the overall impact on the American economy.

The unions will have to realize that top dollar pay requires top dollar performance. They'll have to realize that they can't cash in during business downturns and that the entire company must remain viable in order for their jobs to survive. They should push for contracts that reward employees through profit-sharing plans, not through job banks, absurd medical packages, and pay levels that are 3X higher than market.

The union motivated "class envy" argument is also counterproductive. We've seen that argument in this thread with respect to the severance package offered to top Delphi executives prior to the Chapter 11 findings. Similar sentiments were offered by the liberal democrat governor of Michigan, Jennifer Granholm who can't seem to get a handle on the fact that her state has an unemployment rate over 2% higher than the national average and why giving select Michigan cities the designation of "cool" hasn't caused business to flock to this state.

Granholm "cool" cities

Class envy may feel good, but the arguments most often fall flat. For example, in the case of Delphi the company extended the severance packages to senior management in an attempt to retain them during this difficult period of restructuring. Several points. First, the company believes these individuals are essential to the survival of the company. If they leave, either that area of expertise will be lost or the company will have to go outside to find replacements (which could take months to hire them and then bring them up to speed). If one adds up the cost of these packages (which would only be exercised if they were let go), it's peanuts compared to the ongoing costs of UAW health care (the union pay only 6% of the cost as compared to the 27% paid by white collar workers at Delphi) or the "job bank" which pays 4,000 UAW members to be on-call, not work, yet still retain 95% of their wages and benefits.

Let's look only at the job bank shall we. The average cost of the UAW worker at Delphi is approximately $62 / hour when you figure in wages and benefits.

4000 workers times x 40 hours x 52 weeks x $62 x 95% = $490M / year.

That's HALF A BILLION DOLLARS spent by Delphi to pay workers to sit home and watch Oprah, Jerry Springer, and Doctor Phil. The money at play in the severance packages (which are only exercised if the manager leaves the company) is a fraction of those yearly costs.

That's the reality. But, I understand the politics of the situation and Delphi management is just playing into that mentality when they announce enhanced severance packages for management or huge bonuses for management if the company emerges from Chapter 11. They play right into the hands of class envy when they take that "me first" attitude.

3. What are the lessons to be learned? That we're in a global economy whether we like it or not. America can (and must) compete in this economy. Business knows what is best for their business. However, it's the role of government, not the "corporations" to set the ground rules.

Washington must realize that the lion's share of our economy is related to consumer spending and pass the legislation required to ease the disruptions related to the global economy. For example, the cheap goods imported from China have partially offset the lower wages in the US. One can buy most goods at a fraction of the cost that they used to be when produced in the US or Europe or even Japan. However, the bigger danger is that China basically ignores US patent and intellectual property laws. Therefore, the investments made by the US on R&D are essentially stolen by the Chinese. I favor putting tariffs on Chinese goods (and any other country out of compliance) until they demonstrate that they take our laws seriously. This is something beyond what the Bush administration has discussed and frankly, Bill Clinton had 8 years to address this and did nothing either. I'm all for "free trade" since capitalism has been demonstrated to be a far more viable economic model than socialism in case after case. However, "free trade" should not be blind and our government has a responsibility to ensure that there is "fair trade" and they also should take an "America first" attitude to ensure that our country succeeds no matter what. Economic security cannot be separated from national security. Where I fault some republicans is that they "get it" with respect to national security and the war on terror and being proactive to attack these threats.... but that they don't see as clearly when the issue is economic. The problem with many on the right is as long as THEIR paychecks are big and their stock holdings grow, they don't see the impact on the mass of people in this country and how that eventually will hurt our economy and our national security.

Bringing China and the former USSR into the global economy was done consciously and it was done during the 1990's when a non-republican administration was in office. Frankly, I agreed with Clinton's position because the disruption of bringing a billion low wage workers into the labor market was less of an issue than a pair of isolated and desperate nuclear armed powerful nations.

We'll see if the unions, companies, and government learn from the lessons of Delphi. I won't hold my breath though. Of the three, the companies have been most dynamic and open to change due to the business realities. I see the unions and the government moving very slow on these issues due to their reactionary mentality (in the case of the unions) and the inherent slow motion of a vast bureaucracy (in the case of the government).

The unions didn't need the help of Delphi to implode, they are doing a quite good job of it themselves. It certainly doesn't help them tho...



By replacing the corporate income taxes with VATs and refund them on everything exported, like the other countries are doing. (i.e. When is a subsidy not a subsidy)



As far as I'm concerned, nothing less than a class action suit by shareholders against every board member in the past five years would be acceptable. Then you can throw some jail time on top of that. The SEC should also bar any of them from sitting on another board for the next 20 years or so. They are all derelict in their responsibilities to allow it to get to this point, so make them pay back their ill gotten gains. Maybe if people were actually held responsible for their performance they might perform better

There is nothing even remotely true about that statement.

While shipping jobs off to Mexico or wherever is a valid point/problem, it has nothing to do with GM/Delphi going bankrupt. But salary employees do not have the culture of laziness that is prevalent in a union atmosphere. Laziness in a salary position will probably get you fired. Unless your management is protected by a union, you will get kicked to the curb and have to fend for yourself in terms of retaining any type of benefits/insurance.

And when cutbacks happen, salary people get fired without great fanfare. If a UAW worker gets laid off, they will probably get called back. While waiting, they will receive a decent chunk of their salary weekly. Striking workers get 90% of their pay.

But this entire issue is exemplified in this thread. The same amount of animosity between union and management is found in this thread that is found in union shop floors. We want to blame management for staggering losses, but I don't see Honda or Toyota going bankrupt.

I have no problem with CEO salaries. The market dictates their salary. If a CEO were willing to run my corporation for far less than what the market will pay, I'd have no faith in him/her. Bargain basement executives will not help make your business profitable or get them out of trouble. The best people to do the job get paid well as compared to others. The impact of those salaries on the bottom line are almost negligible. The real costs are the fringes on top of salaries. Insurance, pensions, vacations, holidays, worker's comp, etc.

To be clear, not all union workers are lazy. That is true. But there is a culture of laziness that can't be denied if you've ever actually worked in a union shop. If you are working on an assembly line, the laziness problem isn't as bad because everything is dictated by a conveyor system. But that's only a portion of the people required to for example, build a car. There is at least an equal amount of support employees.

If you are a hard working person in a union shop, you will have problems with your co-workers. These are the intangible costs on top of others that kill a business. And these are the costs not paid in Mexico or India.

Lastly, there is an abundance of examples contrary to much of what I say. But those examples are not the rule.

I still can not believe the total "pass" management has been given here by the conservatives on this board- they are practically reveling on the job losses, and blaming them on the poeple that have no control over the situation-

managment has the right to manage- even manage badly.

This is a case, 10000%, of bad management. Same with GM, it hasn't been well managed since the late 60s. We are just seeing thier slow decline- doesn't have anything to do with UAW or unions at all- outside the symptom, as DR pointed out, of total disloyalty to those that are disloyal to you. I have friends that worked for GM back in the late 60s, when you didn't dare have something in the parking lot other than what you were building on the line. Massive loyalty and pride in craftsmanship. Pride in what they were producing.

What we have in America is the usual stupidity of blaming the wrong group- we blame those with little or no power while the ones with all the power get off scot free.

Do even suggest that CEO salaries are market driven declares total lack of knowledge on how CEO and board members salaries are determined- unlike the Unions, they are not negotiated- they are the same as congress- they just vote themselves golden parachutes and pay raises- and there is absolutlely no consequence or risk to this whatsoever- it is far, far far outside any concept of capitalism, to the point you cant even recognize market forces at that point- one of the main problems IMHO of lack of competitiveness in American manufacturing.

German auto makers are unionized, get paid more, but take great pride in doing the job right, and thier society itself takes great anger towards disloyal CEOs as well.

There will probably be a new paradigm to Unions in the next 20 years, simply because they are the only protection an employee has against our very corrupt American management of PUBLICALY TRADED companies (as opposed to owner operated business, which has all the usual market forces governing it)

I myself, on a job, REQUIRE union hire for my projects- why? My liablility insurance is greatly reduced, due to Union training requirements, to make thier bids always better. But most of these companies also have less than 50 employees, and the boss works right along side his employees, and they respect each other and are loyal to each other.

That is what has been lost in the US-

When we were heavily Union in this country, we had single earner households and American economy was much more stable- when that went away- so did American supremecy. Without Unions, we will become just another exploitive third world country- and we are headed thier fast now.

It's not a conservative vs liberal thing, it's an ethical vs unethical thing.
(Note my earlier post, and my tag

The board and execs ought to be held accountable. Likewise, every time the government (read taxpayers) have to bail out a pension plan, they should go back 5 years and get everything, wages, options, expenses, all of it, from the board and execs. The federal pension bailout fund is already seriously underfunded. That means we will be bailing it out soon.

The labor unions are likewise every bit as corrupt, always have, always will. Any time people get to spend money that's not theirs, they tend to use it for personal gain.

1. Does this major business failure indicate the end of unions like the UAW?

Yogurt- unions are not corrupt, not even marginally anymore. They have always had the weaker position in law and in negotiation- and comments like that illustrate the fundamental misunderstanding that corporate America has succesfully exploited in thier attempt to weaken unions even further, and by extension, every American employee.

Labor does not sit on the board of Delphi as far as I know- some unions do have board seats, when the wage concesions have been like the Chrysler of old- they have recieved stock for payments of salaries. But I don't think the union has a presence in Delphi like that- if I am wrong- than I concede that part.

1the union gave wage concessions-- and there is no way those wages mentioned are out of line with non-union hires.

This whole entire thread is a thinly vieled attempt to demonize unions for managment stakes- why is there no question of "does Delphi management bear some responsibility for Delphis bankrupcy"- the entire three questions supposes hte failure of Delphi is the fault of the union- when that is clearly not the case.

2. How can a union dominated business compete in today's global economy?

There you go again "union dominated business"- how does the union dominate that business if
1) It has no member on the board of directions, so therefore, no decision making ability AT ALL for the basic behavior of that company.
2) gave wage concesions?

As pointed out- there are companies that are #1 in this world that are
1) Union only shops
2) Paid higher than any US worker, with more benefits and more vacation- you act like this is the sole consideration of business, but guess what? Labor costs are only a part of the business model, not all of it!
3) Much larger tax burden than the US.

So how do those pesky unions in say, Germany, who <ahem> "dominate the business" still manage to have one of the most succesful dominance of exporting (for lack of a better word, like durable goods) "stuff"- things like toasters or cars- that supposedly we can't compete in the global economy because of things like wages and benefits?

These job losses, in these areas, as highly skilled manufactoring jobs, are losing out to places like Germany for these kinds of goods- in fact, Mercedes bought Chrysler, not the other way around, and Chrysler was a good target because they reallly had the most efficient and well oiled corp due to Iaccoca and Robert Eaton and such, and COULD compete in Europe very well.

Yet, German unions are MUCH more politically powerful and economically powerful- yet they kick our but in those very areas we are losing whole companies!

3. What lessons are to be learned from this bankruptcy?

That we need top down corporate reform in the way board rooms are regulated, get the foxes out of the henhouse- we will never be competitive in manufacturing of high tech durable goods (the kind that need educated skilled employees, not just bodies in a line) as long as we have these parasites in the board rooms. There needs to be some accountability for thier decisions- they shouldn't be able to declare bankruptcy for the company without some personal loss, at least equal to the rank and file employees.

Managing badly should have some sanctions- and in America, in the arena of large corporations (over 10K employees , traded on the floor of the US stock exchange is my definition here for clarity), we need lots and lots of oversight and checks and balances for thier behaviors- because the very security of our nation depends upon it.

How lucky were we, with Chrysler on the ropes in the 80s, saddled with poor management and sagging sales, that we had an Iacocca instead of a Ken Lay or Dick Cheney?

Iacocca had a vision not of huge salaries for himself, but saving the company. He based his pay on long term profitibablity of his decisions,

and most importantly, negotiated with the unions in good faith, who took large pay cuts, beting on future improvement of the company itself- showed loyalty to the employee in a big, big way, and those very employees made Iaccoca, by his own words "look good"

THAT is how you compete globally- know where your freakin' bread is buttered- everypone is in the same boat for failure or success- company goes gangbusters- you share that with your employees a bit, doesn't mean you go broke doing it- but more for a "job well done"- and during bad times EVERYBODY tightens thier belt- and I only see one side "tightening thier belt" at this time.

So what is not "even remotely true" about my statement, DaytonRocker? You conceded my point that not all union workers are lazy.

My husband worked for 30 years for one corporation. He worked hard on the jobs he had. He worked for incompetent and very capable salaried and non-salaried co-workers. He did his best to maintain his integrity in some very trying situations, and sometimes there would be a foreman who had it in for him for some reason. The union offered him someone to stand up on his behalf in a company where salaried employees could be dismissed merely because the boss didn't like something about them.

My husband knew screw-ups in management and in the hourly union members. Usually it was their own shenanigans that eventually landed them in the unemployment line. In the meantime, the corporation streamlined and automated processes so that a work force that numbered in the thousands was whittled down to approximately 1,500 by the time that he retired.

I hope that Curmudgeon chooses to post in this thread, because he has plenty to share about the positives and negatives of having a union shop.

But the fact remains that Delphi management, not the union rank and file, is responsible for the failure of their corporation. Obviously those most responsible for this debacle will not suffer the consequences the way the hourly workers will.

Regardless of how you feel about union workers, that is not fair to them or to their families. The golden (or platinum) parachutes these executives get for their severance packages could go a long way for many rent payments, mortgages, and heating bills for the little people whose wages were to be cut down to $10 per hour.

1. Does this major business failure indicate the end of unions like the UAW?

I don't know if it's the end ... I think it's one more salvo in the battle being fought over the relevance of unions to the American workforce.

My father was a union man for a while, and he was actually anti-union as a result of the experience. I tend to agree with him from my own (admittedly slight) experience in working a contract job in the offices of a GM plant a few years ago. The parts of the offices staffed by union people were where you could find folks reading magazines, ordering from mail order catalogs, and just generally jacking around on company time.

I think that others have said better than I can, that unions must wake up to the real world and PARTNER with management instead of taking the adversarial position. The demands for more and more money and benefits certainly don't lead to a company's best performance. Compromises are necessary on both parts.

2. How can a union dominated business compete in today's global economy?

With everything being shipped overseas? It can't.

3. What lessons are to be learned from this bankruptcy?

As I said, unions and management will have to work together if they want to ensure the company's continued success.

One thing that was mentioned above is health insurance. I've said before in earlier posts that health insurance is a fairly recent part of an employment package. And it's been SINCE health insurance became more commonplace that healthcare costs have gone through the roof. It's just like college costs ... in the past, it was not assumed that parents "owed" their children a colege education. That 'tradition' was trumpeted by the colleges, as one way to inflate tuition costs (since Dad and Mom presumably have more money than Junior could expect from a scholarship). If it's believed that "someone" will be standing in the wings with a checkbook, the sky's the limit on pricing.

I hope I am not going to sound cold here, but ... this is a high tech world. Manufacturing and factory jobs have been disappearing for the last two decades. It's not as if there's been no wakeup call for people who work these jobs.

Getting skills and training to do work outside of the factory or mill makes much more sense than continuing to live up to the last dollar of a union wage, so that when you face a layoff or plant closing, your life collapses.

A lot of union people got themselves into the great American debt morass, with credit cards, mortgages, and a two-income lifestyle that hung them out to dry when the union jobs went away. As sorry as I feel for them, it's not as if the ones who have recently been laid off couldn't have seen it coming.

I read a couple of Dayton Rocker’s posts in this thread, and his experiences do not reflect anything like the union environment I worked in for thirty years.

I was hired by a company that had about 8,500 hourly employees. The recruiter that hired me spoke of on the job training, educational benefits, an annual income that I would be starting for, etc. I was not even told that it was a union shop until I had been there for 30 days.

Eight years later, when we went on strike, the workforce had been reduced to 6,300 hourly employees. (There was a commensurate reduction in salaried employees as well.) While on strike for six months, I did not earn 90% of my wages. If I showed up for picket duty as scheduled, and put in a full 8 hour shift, I got a gas certificate worth $5.00, a ground bologna salad sandwich, and 1 cup of black coffee.

By the time that I retired, automation had reduced the need for manpower, and I accepted a buyout package aimed to reduce the workforce to 1,200 hourly employees.

Production operators were well aware of the fact that their jobs were in peril. One building that I worked in circa 1967 – 68 had taken 45 minutes to evacuate when a fire drill took place, another 45 minutes to get back to our jobs when the all clear was sounded, and several hours to get caught up on the work. It had several hundred hourly workers at that time and perhaps four salaried employees to each hourly employee. There were only a half dozen doors that we usually used for ingress and egress. At the time I retired, the building was run off shift by two hourly employees. The plan for the year 2,000 was to build a central control room that would run that and 5 other production plants making similar products from a single control room with two employees.

By the time that I retired, I was working as a skilled tradesman. As such, we were well aware of the fact that every large contract job we worked on had been bid competitively against non-union contractors. Our chief advantage was being familiar with the plant, with its engineering practices, with its people, and with being able to understand what was being asked of us when we looked at a blueprint.

I can think of one hourly employee who I worked with who was truly lazy. His first day on the job, he was working as an electrician’s helper. The electrician got into an argument with him, and said, “Go sit in the lunchroom. When I need your kind of help, I’ll come looking for you.” The journeyman spent the next four years telling his boss that he had all the help he needed. Then he got promoted to supervisor, and ended up with the same “journeyman electrician” on his staff. By this point, the union had been involved several times and had been able to protect the helper’s job by pointing out that he was following orders. At one point, he documented how many light bulbs the janitor changed over a period of several months and filed a grievance asking for overtime pay for the amount of time the janitor had spent. It went to arbitration, and the arbitrator ruled that he had successfully proven that changing light bulbs was a janitor’s job. At the next contract negotiations, the company then eliminated the janitor classification, and contracted that work out. At the end of that employee’s career, his wife hired a stripper to entertain him at work. (It was his birthday.) He went home with the stripper that night, instead of going home to his wife. His wife was the granddaughter of the company’s founder, still had a great deal of stock, and still had a great influence with the board of directors. He was directed to the retirement dept. the next morning.


Salaried cutbacks have always gotten a lot of press. They also got a lot of talk afterward around the shop.

On any given Monday morning, perhaps 10% of the salaried employees reporting to work would find their passwords had been eliminated, they could not log onto their computers, and “By the way, Plant Protection wants your keys. They’ll be around to help you pack up.” Afterward, we would hear the feedback…

“Well, I let John go because he has a good resume, is a hard worker with a proven track record, and I’ll have no problem writing him a recommendation. He’ll have no problem finding another job.”

“He joked about the fact that the purchasing contract he had just signed would save us $15 million a year. He said he felt he could safely go to lunch knowing he’d have a job when he returned…”

A neighbor sat on my porch once and talked about his new car. “I stopped at the Credit Union to pick up the loan on the way to work. They told me I’d need a co-signer. I talked to my boss, and I asked if my job was in jeopardy. He sat down, gave me an impromptu performance review. (A very good one.) He drove me to the Credit Union, co-signed for the loan, and dropped me off at the car dealership. A half hour later, as I drove back into work, he met me at the gate. ‘I hope you’ll believe me when I say, I didn’t see this coming…”

The supervisors that followed me around eight hours a day with a stopwatch; timing my bathroom breaks and computing the cost of saying hello (51 2/3¢) to someone who spoke to me always seemed to survive the purges…


I’ve taken several courses over the years in management in the hopes of making that move from hourly to salary. I always lacked the basic people skills necessary. I do recall however that in every such course, I was told that it was management that had to plan the budget, management that had to control the expenses, and management that was responsible for the corporate bottom line.

Why did management wrap a building in plastic, heat the enclosure, sandblast and paint the exterior of the building in February? Why did they replace the control room floor 3 times in two weeks? Was it “good planning?” It was a pharmaceutical plant that was scheduled for a Valentine's day FDA inspection, and the building management had submitted a request to the board of director’s for a cleanup and fix up prior to the inspection. The request came back from the board of director’s approved for “whatever it takes.” With a $500,000 daily net profit from the building, it probably was good management to keep the plant running at all costs. With a $1,000,000 annual maintenance budget, someone in management could have noticed in warmer weather that the building needed a new coat of paint, and someone could have found a better control room floor when they first noticed it was hard to keep clean.

Employee morale is also a management function. There are a number of companies that provide educational support to management to help manage employees, improve morale, involve employees in the decision making process, etc. Honda and Toyota were often cited as examples of good management, team building, and good morale.


So turn to legislation. In Europe, I have been told, there is no need for Health Insurance. It is simply covered by the government. Union and non-union employers alike are mandated to provide their employees with the same vacation benefits, so it is an even playing field. Non-union employers are already required to pay pensions on long term employees, and provide worker’s comp. Those are non – issues.


I worked for over thirty years in both union and non – union shops. My experience is that the union workers were well aware of their wages, their benefits, and their competitive position. They were, as a rule, loyal employees who looked forward to retiring from their employer or union. My experience in non union shops was that people felt they were temporary help, knew that they were underpaid, and were constantly talking of where they might find better work. It was in the non – union shops that safety rules were ignored, extended breaks taken when they knew that no supervision was in the building, etc.

In a non-union shop, we followed orders, end of story. At Dow, a union shop, if an operator needed a problem solved, he got hold of the appropriate tradesman, explained what he needed, and the work was done. While the work was being done, the operator would generate a work order on the computer. The tradesman was given the number to charge his time against. When the work was finished, the tradesman wrote up what had been done, and closed the work order. Supervisors had responsibilities other than sitting on employees all day long. I worked for my last foreman for example for six months before he came out to the clock room one night to meet me. All our communications for the first six months had been by e-mail.

1. Does this major business failure indicate the end of unions like the UAW?

2. How can a union dominated business compete in today's global economy?

It’s simply amazing how someone can take a complex event and ask for a single-factor analysis confirming one's preconceived notions.

It wasn’t long ago that you started a similar thread involving Northwest Airline’s mechanics.

http://www.americasdebate.com/forums/index...topic=10943&hl=

It’s interesting that Delta Airline, where only the pilots are unionized, filed for bankruptcy protection the same day as Northwestern.



http://www.thedailytimes.com/sited/story/html/219097

I think Delphi’s problems, like those of Delta and Northwest, are more complex than the anti-union bias your questions seek.

3. What lessons are to be learned from this bankruptcy?

The first lesson should be to look for the complexity rather than simplistic reasons for busines failure.

Mark this day on your calendar, LH. It's about the only time we'll agree, I suspect. I agree with you and DaytonRocker that there is a lot wrong with some unions, and that the job protections afforded for workers who fail to show up, or who do nothing once they show up needs to be changed. Now, back to our basic disagreement Let's face it, as CruisingRam has pointed out, there is plenty wrong in the board rooms as well, and I'll point out some of it in a moment.


This is something that the company executives and board members need to realize, as well though. Unfortunately, all too often, they manage to find new ways to enrich themselves, even while the company is sliding into bankruptcy.

Ok, so what's your point? Two years ago, I think it was, Disney decided to cut loose Michael Eisner, because the company was headed downward, without an end in sight. Yet just before he was kicked to the curb, he was still paid a hefty bonus, and was able to option stocks amounting to $535M, and that's just to get rid of one guy! If I remember my grade school math, $535M in one month, for one employee, far exceeds $490M in one year for 4,000 employees.


So why do it? Are you really going to tell me that there will be mass resignations or layoffs to senior executives if they don't get there bonuses? If we have to pay people even more to work harder doing what we supposedly were paying them to do to start with, (keep the company solvent, and making a profit) maybe we don't need those executives at any price.

Congratulations, I think you got it. That being the case, why are you so willing to blame Delphi's fall entirely on the UAW, and not even look at the guys at the top?


That's not exactly true, Dayton. True, salaried people get let go without a lot of fanfare, but then again, so do union people. If a UAW employee gets laid off, he may get called back, and then again, he may not. After all, isn't that what the job bank LH was talking about for? How many of those 4000 really have a chance of getting steady, full time work again? Also, I have had several union members in my family as well, in the communications industry. Striking workers only get 90% of their pay, as long as the strike fund holds out. That's usually only enough for a couple of weeks, any more. After that, they aren't getting anything.

And yet, Honda and Toyota also have union workers in this country. Could some of that difference between GM and Toyota be due to management decisions, the fact that Japanese executive pay structure is usually a lot less that US executive pay, and the fact that they build quality cars that sell just about anywhere, as opposed to the stuff GM has been selling in recent years (SUVs not withstanding)? Nah, it's gotta be all the fault of the unions. Sure.


Of course the best people for the job get paid more than the average employee. I don't necessarily have a problem with that. But does the market really dictate a CEO's compensation in the US anymore? I don't think so. At least, not the way you're thinking of it. After all, this is a global economy now, if you remember. So let's compare, shall we? In Europe, the average CEO salary is between 16 and 25 times the average workers salary. In Japan, it's 10 times the average wage. In South American countries, the CEO pay is around 50 times that of the average worker. In the US? It's more than 500 times the average worker pay.

So, does that mean that US CEO's are that much better than those in Japan, or Germany? Not if you look at the difference in profitability of the companies. As you noted, Toyota, and Honda are extremely profitable. So is BMW. And if the US auto companies are doing so well, executive-wise, why is it that Daimler-Benz bought Chrysler, and not the other way around?

Something else to consider - the higher executive compensation is, the worse a company does. Source:

So, Dayton, you can overspend on your CEO if you want, but high salary demands do not eqate to a more profitabe company, nor to CEO qualifications.


Again, labor unions in this country need to change the way they do business in this country if they are to remain viable. On the other hand, it seems to me, the corporations themselves need to change the way they operate as well, if they are going to remain in business at all.

Do you have a source for that comment, because I don't believe that to be true. The union has attempted to get into both Honda and Toyota, but I believe they failed. In fact, Honda in Marysville, Ohio built their employees a rec center and the UAW sued them. Sued them because the company gave their employees something.

I don't dispute management problems. But all these major bankruptcies (Delphi, GM, the airlines) are union. Somehow, the union companies are failing because each and every one of them have hired incompetent executives to run them (as suggested here), but the non-union places seem to have hired the competent ones that can keep them in business. I'm sorry, that's just not plausible.

Again, I've worked in multiple union shops from Maryland to Ohio and nothing but the weather changed between any of them. The unions will get increases every year no matter what the profitability is or isn't. My last job (non-union), nobody got a raise for 4 years because of the current economic climate. That sucked, but the company didn't go broke and put everyone out of work. I always had a job. If that place would have been union, they'd have folded the tent and went home. They just couldn't compete.

And that's the problem the Delphi's of the world have now. Non-skilled uneducated labor expects to get paid twice what teachers make and blame the world for shorting teachers instead of facing the reality that they should be lucky to have a job with benefits.

Daytonrocker is 100% correct. The plant building Toyotas in the US is NOT a UAW factory.

Toyota

UAW debacle

Neither is Honda or Nissan.

It would seem that the common denominator in the companies in trouble is.... "the UAW".

1. Does this major business failure indicate the end of unions like the UAW?

2. How can a union dominated business compete in today's global economy?
America's manufacturing companies are having trouble competing regardless of whether they are unionized or not. As I pointed out in another thread, the root of America's manufacturing troubles stem from excessive government spending. Take away the excess federal spending, and pretty soon this so-called "consumer class" will realize that true prosperity comes from producing things, not building more parking lots and Walmarts.

3. What lessons are to be learned from this bankruptcy?
There is only one lesson I can think of. America needs to start manufacturing more than just cars and junk food. Did you know that there is on average 1 car for every American? Just how does GM and Ford expect to sell more cars? The majority of people outside North America are too poor to buy cars.

Okay, still you have not explained how UAW got into the board room and took over the running of the company and made it unprofitable-

and I find it interesting you forgot to mention that the CEOs and board members of Honda and Toyota make far less, far, far , far, far less than the American companies you mentioned?

"Interestingly, within Japanese companies — even large ones — the salaries of CEOs are typically less than $1 million a year. Indeed the median is more like 30-60 million yen. Even when receiving retirement allowances, these CEOs would be fortunate to take much more than an extra $1.5 million home with them."


And that liberal rag, fortune 500, even recognizes the problem- yet you blame the UAW?


http://www.fortune.com/fortune/ceo/article...,443051,00.html

"You'd think that in the aftermath of a scandal that made Tyco a symbol of cartoonish greed, its board might want to make a point of frugality. Yet even as it was pressuring its former officers to "disgorge" their ill-gotten gains, it was letting its new man, who became CEO last July, gorge himself on $62 million worth of cash, stock, and other prizes. By all accounts Breen is doing a fine job so far (see Exorcism at Tyco), but still. And the gravy train didn't stop there. Tyco's board of directors dished out another $25 million for a new CFO, plus $25 million to a division head, putting them both on a par with the CEOs of Wal-Mart and General Electric. "

So, a CEO salary that reperesents a 1/4 of the total workforce salary is okay, but even wage concessions are not a reason to lift the blame from the unions?

The Justice Department would be thrilled to hear that. They still have a lot of resources tied up throwing the leaders in prison.



These were all in the last month, you can read the whole thing here: NLPC Labor Accountability Project

While I strongly agree that the execs are to blame for much of Delphi's, and others, problems, it's only fair and prudent to look at the whole picture. There's plenty of culpability to go around. I just hate it when they get in my pocket to pay for their ineptitude and extravagances.

Not quite so fast, there guys. First, I beg your pardon. You are right, Honda does not have any union plants here. Neither does Nissan. However, you are incorrect about Toyota. True, the factory that builds Camrys is not union. However, the plants that build Corollas and Tacoma Pickups are UAW plants.

In fact, many of the foreign auto makers with factories in the US have union labor at at least some of their plants. For instance: Isuzu (Hombre Pickup); Mazda (626, B-Series pickup, Tribute SUV); Mitsubishi (Eclipse, Galant, Quest mini-van); and Suzuki (Vitara/Verona, Swift/Esteem) all make the listed products in the USA with union labor. Source

Also, it's true that American auto makers like GM and Ford are weighed down by the huge burden of paying pensions and health costs for current union members and retirees. But the foreign vehicle plants in the US have more or less matched the union's costs for current workers. So union members see the legacy costs as something US automakers have run up by failing to protect its market share with a competitive product lineup.

This is, in fact, what's behind the latest crisis at GM and Ford. They relied on large pickups and SUVs to make their profit for them. In fact, it became a massive contest between them to see which one could build the biggest "baddest" SUV, without actually selling the public a semi-tractor. But Honda, Mazda, Suzuki and Kia pushed hard with smaller, more efficient crossover SUVs, mini-vans and sedans. And made a killing. And they'll make an even bigger killing with gas at $3 a gallon. Meanwhile, Ford and GM stocks are rated at "junk" status, and still falling.

Ford's been too busy buying british imports that almost no one here can afford (Jaguar, Astin Martin), and they haven't really updated their existing line in years, with the exception of the new, retro-looking Mustangs.

And look at GM's "new" cars. The Buick LaCrosse, Chevy Cobalt, and Pontiac G6 are more standard import reworks (Cobalt), or they are lackluster updates of other cars already in their lineup (Pontiac G6, which is basically a new body on a Chevy Malibu). And while GM spent $4.5 billion for a piece of Fiat, its rivals including Chrysler, I might add, invested in designing fresh, innovative new models. And that's why Chrysler and the imports are riding high right now.

So you can tell me all you want that GM's problems are mainly the fault of the union. You can tell me that, but like with GM's cars, I ain't buyin' it. The unions didn't make GM invest in an overpriced, second rate European brand, and the unions didn't have a say in whether or not to build some stylish, but fuel efficient cars, instead of gas guzzling monstrosities. Yet, somehow, the union is being made out to be the heavy by the GM execs, and many (though not all) on this forum.

1. Does this major business failure indicate the end of unions like the UAW?

I think we should take a step back and look at what happened here. Bankruptcy is not really a business failure. It is relief from debtors. Delphi is still in business and is still making parts for GM.

What happened here? What debts does Delphi need relief from? Here is an article from last month that explains some of the details: Delphi tells UAW to cut pay

First of all, when Delphi split from GM in 1999, it was forced to retain the labor agreements in place at the time. GM pays each worker, on average, $130,000 in "pay, benefits and job and income security".



Delphi is using bankruptcy is do away with the job and security agreements made with the union. In summary: the bankruptcy is the only way out of these agreements, since the union will not concede ground on these issues.

I don't see any glaring errors that have been made by the management of Delphi. They were forced into these agreements when they broke away from GM. They really didn't have a choice there. Likewise, they did not plunder the treasury, as it were. There haven't been any accounting scandals or any evidence of personal enrichment.

Delphi has not been as successful as Visteon with shedding some of its obligations to UAW workers: Visteon Strengthens Competitive Position With New Ford Commercial Agreements which has lead to the position that they are in today. GM has not been as helpful to Delphi as Ford has been to Visteon.

This is really a microcosm of the looming Social Security crisis: not enough workers to fund retirees. These retirement plans were unfunded and now have come due. Delphi has 2 workers per retiree (in the US). Social Security is quickly approaching that ratio as well.

2. How can a union dominated business compete in today's global economy?
I think unions need to change their attitude. They must work with management to keep the company competitive. A non-competitive company is soon a non-company and I think unions need to realize that fact. I'm sorry, but when janitors make $24 an hour, a company cannot remain competitive.

Management can (and must) work with unions to make a company successful. Everyone has to be reminded what's at stake: the future of the business. An out-of-business company makes no one any money.

3. What lessons are to be learned from this bankruptcy?

High wage workers must be very productive or else they are not cost effective. Deals bargained between management and unions must be flexible. Management must be honest with the union and with shareholders as to earnings and profit expectations. The paradigm has shifted and now business and labor must shift with it.

Okay Amlord- I get your position, and you are accurate about the underhanded contract breaking and lying by Delphi- you know, you make a deal, you are supposed to live by it- you agreed to it when you started the company, now you want to weasel out- unethical, but legal I suppose - of course, agreeing to those terms in the first place as part of the split has nothing to do with management

But let's go further- what is the boardrooms personal salary totals? I be willing to bet thier packages exceed 100 million dollars! Especially considering the raise they gave themselves

I would possibly buy into your argument if they were not busy reaching into the company coffers to enrich themselves on a massive scale.

It is 1000000% mismanagement in this case, both by GM and by Delphi-

As Niteguy pointed out, a great many foriegn companies either pay competitive to the UAW if non-union, with benefits and job security, or they ARE UAW- the common denominator is not LABOR- but management

BAd, crappy cars GM produces, along with Ford. So now Delphi doesn't have enough buyers for thier parts- product development IS ALSO MANAGEMENT RESPONSIBILITY- I don't care if you have no labor costs at all- IF YOU DON'T HAVE A PRODUCT SOMEONE WANTS TO BUY, YOU HAVE NO BUSINESS, UNIONS DON'T DECIDE WHICH PRODUCT TO PRODUCE- MANAGEMENT DOES-

Bad management, bad management, bad management- it SHOULD be the mantra of every person in this country- we have the most mis-managed corporations on the planet as a whole- NO COUNTRY has as average as high a pay for corporate execs ESPECIALLY FOR SUB-PAR PERFORMANCE OR EVEN OUT RIGHT FAILURE-

I saw the begining of the end for GM when Stemple (sp?) took a 16 million dollar a year pay raise, while GM was going down the tubes- he took no responsibility for the lack of competitiveness in GM then, and they still don't take any responsibility for thier horrendous products they are deciding to put out- which is sad, because they have MILLIONS of devoted followers TELLING THEM what they would buy, and they ignore it.

Take the New Mustang- this is a consumer designed product almost- when the PT Cruiser (and the new Dodge Ram really, started the retro look movement) was succesful, Ford went to enthusiasts and asked what they wanted- and you have the new Stang.

GM loyalists had petitions, folks ready to send deposits etc on a new gen rear wheel drive Camaro- so what crap did GM produce? The new GTO- what a pile of fecal matter!

Go to the GM forums- they will tell you straight up that GM management has their head up thier fourth point of contact so far they can't see any light at all.

GM and Delphi execs are just trying to shift blame while increasing thier personal bank accounts for thier own massive, and continuous, and clueless, failures.

GM and Delphi are classic examples of totally clueless and irresponsible management in every way- whereas Toyota and Honda (though, if you are a gear head like me, you may be recognizing that Honda had better get off it's laurels real soon too, especially in bike and car design for the next 10 years)

Amlord- there is no way on God's green earth you can pin 1% of GM and Delphis mismanagment, and it has been going on for 20 years now- on the Unions- the unions may be paid, but no more than thier German or Japanese counterparts, and have less vacation time, and work more overtime.

I have no doubt you will stick to your anti-union guns- but that doesn't change the fact that GM and Delphi have mismanaged themselves into a hole, and now, looking for a scapegoat, are turning to the Unions, and asking them concessions, while giving none themselves. THAT is the fact, that is the reality- there is no grey area here.

Please Amlord- you are probably one of the smartest and most well read and able debaters of a right wing nature on this board- and I respect that- but how do you reconcile this little tidbit with your above statements on wages:

http://www.prospect.org/web/page.ww?sectio...&articleId=9540

One important fact ignored by the American media is that Japanese industrial wages are now among the world’s highest. Not only are they far higher than in China (between four and 15 times higher, depending on the region of China), they are actually 20 percent to 30 percent higher than in the United States. Yet Japan’s export industries have not only survived but thrived.

I commend Toyota and Honda management. They've resisted, in almost every case, letting the UAW into their factories.

They also don't have the legacy of the UAW at GM that Delphi inherited including unworkable pension agreements and an average cost of $130K per worker.

They are also in relatively new factories that were built in areas that offered extensive tax cuts in order to attract that business. Not something that is often seen in democrat dominated (i.e, UAW) regions in the US.

The old way of doing business (i.e., UAW) and the reactionary mentality won't survive in a global economy. They can adapt, or die.

I hope they adapt. This country needs a strong middle class as I've stated before for solid economic reasons.

So you commend Toyota management hey? -

So what % of the blame do you place on Delphi managment?

I hope you are correct about each and every plant recieving tax breaks from Republicans- because you have provided no link to that claim- do you have one?

I'm not into playing the "blame" game.

The topic of this thread was to look forward. Thus, the three questions.

I maintain that unions like the UAW with their "ratchet" mentality of ever increasing pay and benefits in spite of business conditions are obsolete. Delphi and NWA have proven that.

I maintain that no union dominated industry (or institution like public education) can compete unless the unions rethink their way of doing business. The hard fact of the matter is that union dominated industries in the US suffer from two simultaneous conditions; high costs and poor quality.

I think that American can compete on a global basis but we have to adapt to the reality, increase our flexibility, and leverage our talents which are technology, flexibility, and creativity.

Instead of whining, placing blame, and attempting reactionary "turn back the clock" methods, we need to roll up our sleeves and get with it.

Our country requires a strong economy and a strong middle class. Organizations that extort $130K / year to cover low skill work aren't going to make it.

Organizations that value ongoing education, ever increasing quality and value, and who share in the profits (and the losses) will have a chance to succeed.

The UAW isn't going to get the American worker anywhere other than unemployed. I'm glad to see that the majority of Toyota and Honda workers realize that fact.

But LH- you STARTED the "blame game" by your very question- you suppose that the failure of Delphi and GM by your very answers and question lie with the Union- when others here have proven, totally, over and over again, that it is bad management- a much fairer question- without blaming anyone would be "how should Delphi adapt" - not how the union should adapt- unless you want to talk about Union losses themselves, a fair subject in and of itself- but UAW and labor costs, have been shown, to be a minor part of this puzzle over and over again-

had Delphi and GM made a product WORTH BUYING- we wouldn't even be having this debate, now would we?

I have shown you how Japan and Germany, with extensive unions, not only compete, but win- but your answer "it is thier culture"

I have shown you, how toyota and honda, with the same contracts, the same employees (often, laid off employees from those very same Delphi or GM plants- remember, they are Union, and have seniority hire preferences)- have still allowed Toyota and Honda to make a profit- now why is that? Perhaps they make a product folks want to buy? You know- basic capitalism 101?

The best educated workforces in the world, that also have a profitable bottom line, are usually union- because the union demands education- which is why I hire union locally- they have education that drives thier liablity rates down that allows them to be competitive with "warm body" workers the other guys use. I can be sure that when I hire a union company to build something for me locally

1) Everyone is a legal US citizen
2) OSHA will not be coming down on me for safety violations
3) They have the best education to do the job, and are up to date with the most current regulations and code restrictions.

How is that for an advantage? I will not even risk a non-union bid anymore- mostly because of illegal hires and the fines they can hit everyone with, as well as OSHA stuff that can kill a biz in one freakin' day!

IT IS NOT UAW that is obsolete in American biz and why we can't maintain competitiveness- it is 100000% of bad management- blame game or not- management in America, when in comes to large corporations, is clueless and self serving. That is why Delphi, and eventually GM if they don't get it together, will fail, and it will not be one iota of UAWs fault for this.

Perhaps the best answer is this- for unions to start buying out thier companies with thier collective might- and using that might to influence new managment into good decisions- perhaps it IS time for unions to enter the board room to protect thier members from idiotic, moronic decisions like the GTO and gas guzzler SUVs being thier only "back up" sales.

DCX employees did just this- gave wage concessions for ownership in the company- and boy, did that ever work!

I have talked with UAW workers when I vacation at various "hot rod" events- like at the Dearborn Museams and such- and if they were able to buy into the company, in a large way, and see smaller board room salaries, thier attitude might change

Also- there is this

DR mentioned about employee behavior- I don't know which plant he worked at- but I did see the Chrysler employees working on Vipers- and they had to have seniority to even work this line- and boy, talk about dedicated! Not doing your job would get you ostrasized quick!

Baloney! I asked three questions on a current event and asked for comments on those three questions. I added no commentary until a later post.

Frankly, you've made your point. You blame "Delphi management" 100% for the company's problems.

That's one point of view. However, I suspect it's not the prevailing position of the majority of people at that company nor their stockholders.

The management that may be responsible is gone. Several may find themselves in jail.

But the fact of the matter remains that the company cannot remain viable with a labor force that costs, on average, $130K per head. Each one of those workers, including the ones who "work hard" and the ones who goof off and sleep on the job just don't generate enough revenue to pay for themselves. That's because GM (and the others) will take parts from any number of suppliers who don't have that same cost structure hanging over them. Who knows, perhaps GM will even go to Russia to get their parts. I'm sure that labor is way cheaper over there (as it is in China).

So, the organizations who represent those workers can be flexible and deal with that reality or they can act like the UAW and the NWA mechanics union and lose everything.

It's really their choice. Blaming management doesn't really solve anything. Someone has to run the company. I haven't run into anyone on any factory floors lately that has any concept about how to go about doing that so it was a wise move for Delphi to move to try to keep those skills intact.

Okay- how is the unions in America as a whole to combat what has been a very, very good PR demonization of them for management failures perhaps would be a very good question -

I would go three pronged if I was ruler of all American unions -

1) Start spending less PAC money and more PR money for a while- unions just don't have to resources to fight big biz on the political scene- for all the talk of unions and politics- big business is just too big and too powerful for the unions to fight right now on that front- first they must swing the tide of the PR war and the republican right wing radio, in a big way. Play just like limbaugh- don't worry about facts or truths, just start spewing stuff folks want to hear on a regular basis that is anti-management and until you get poeple to believe everything you say. Seriously- I mean that. It is what big business has done, and been very succesful at.

2) STart using resources to get into the board room and riegn in the morons on management that keep producing things like the GTO. Make them remember thier customer base, who buys cars, that kind of thing that GM management and Delphi has forgotten- or when you bring in someone like Bob Lutz, the guy behind Iacocoa that developed the viper etc- MAKE MANAGEMENT LISTEN TO HIM- basically, Unions have no ability to force management to manage wisely at this point. The best way to change that is to become major stockholders that can start voting down management perks and salaries. You really don't need 30 million dollar a year salaries to atract good CEOs- toyota has seemed to be able to do it for less than a million.

3) This is something all unions have already started to do and will make good headway IMO- start thinking unionizing globally. Union wages SHOULD be the benchmark for a living wage- it should not have to adjust down to slave wages- it should force the economy to adjust up, not down.

But first and foremost- they are losing the lobbyist and PR battles big time.

For all the criminal behavior of the old guard union jimmy hoffa types- they were never as destructive as one ken lay or Micheal milken. We need corporate reform, and we need it big time. The laws are just too skewed in this country away from entrepeneurship and non-publically traded companies and towards large beaurocratic corporations like GM, with really 0 accountability to anyone with the rare exception that thier crimes are SO egregious and SO public that they get a slap on the wrist and retire comfortably at a mere 5 billion dollar net worth (Micheal Milken) - we need RICO style laws for the board room, and completely remove compensation packages out of the board room forever- make it a yearly package each actual shareholder has to vote on, not by proxy even, every actual shareholder, say "X" percentage must vote, taken out of the renumeration budget of management- before any compensation packages made legal. Also, make golden parachutes and the like punishable by jail time. Management retirment packages MUST be included in the employee retirment fund, and they must abide by the same retirement rules- in other words, you work 10 years, you get the same package as an employee that quite after five years.

Stock options can only be used 10 years after leaving the company, or at age 65, which ever comes first.

If the Unions were able to effect management reform in this country, the entire country would become more competitive.

We are simply focused on the wrong area for what is wrong with American business.

I don't believe that it does, while no two unions are similar, the UAW did try and work things out with Delphi. A UAW press release mentioend this:






What can be learned? That when a company is about to go under, it is the hourly workers and those at the lower end of the ladder who bear a disproportionate burden. Once again, the UAW noted this disparity:


http://www.uaw.org/news/newsarticle.cfm?ArtId=346

So you think bankruptcy is "underhanded contract breaking"? Perhaps we should do away with it in all cases... Delphi should just close its doors and call it quits I guess.

There is one underlying issue here: the "high fixed cost of operations". Delphi has the same operating costs whether it sells $20 billion or $30 billion worth of goods. Why