Saturday, December 13, 2008

Reality Calling

Image credit: AFP (According to the caption, this is a Toyota worker at a factory in Japan assembling a Lexus.)

It's hard to fathom how badly dysfunctional our government is. When I read things like this, it really takes my breath away:

WASHINGTON (CNN) -- The proposal to loan $14 billion to Detroit's struggling automakers collapsed late Thursday night but the Big Three may get some money anyway.

Bush officials warned wavering GOP senators earlier Thursday that if they didn't support the legislation, the White House will likely be forced to tap the Wall Street bailout to lend them money, two Republican congressional officials told CNN earlier.

The White House on Friday confirmed that bank bailout funds may now be tapped to aid Detroit.

Bank bailout funds could be used for Detroit

The Bush Administration, playing against type, are acting like responsible people. At least, they look responsible compared to the Republicans in Congress who rejected a $14 billion loan package to the U.S. automotive industry:

Tonight Harry Reid called for cloture on the auto bill, knowing he didn't have the votes.

Chris Dodd spoke for working people, and expressed his disbelief that the Senate could let this happen right now (YouTube). Talk about your War on Christmas.

Corker of Tennesee then went on to make an impassioned speech about how close they came to a deal, the only sticking point was that the UAW wouldn't commit to a date to accept salary parity with what workers in foreign auto companies make. Mind you, the Republicans didn't ask for commitments from dealers or creditors or bond holders or suppliers, just blue collar workers. So that was really where the only problem was going to arise.

Auto Bill Fails In Senate, 52-35 — Say Good Night, Gracie

The cloture vote included three Democratic defectors - Baucus and Tester of Montana, and Lincoln of Arkansas, voted against cloture. Reid also voted against cloture, but he does that sometimes so that a bill can be reconsidered later. Four Democrats didn't show up. By my count, if the Democrats had all showed up and voted "Yes", the bill would have passed. Perhaps Kennedy couldn't make it due to health reasons. At the moment, though, I chalk this up as another failure of Reid's to get anything useful done. He appears to have had the votes this time. All he had to do to get them was lean a little.

The other thing this episode points up is how clueless people are about the value of unions. I'll just state right out that I was once a member of a union. I'm not fond of them as a rule, since they tend to make workplaces less flexible and make it harder to get ahead based on merit. Nevertheless, they serve an important function, which is to represent us workers as a unified force to management. They can make management listen to workplace safety and benefits issues. They can make their workers better paid. Just try doing that in a non-union shop the size of Ford or General Motors.

Yet the myths persist. Here's an example of the "thinking":

If I was a low-skilled worker with nothing but a GED or high school diploma and 15 years of putting Bolt A into Hole B I'd be pretty thankful for salary in line with Honda or Toyota instead of other low-skilled manufacturing jobs which pay significantly less.

Comment #2 on: "A Study in Republicon Dumbfuckery"

First off, most repetitive jobs like "putting Bolt A into Hole B" disappeared a long time ago. While they still may not be as mentally stimulating as hunting the Higgs boson, assembly line jobs aren't like this any more. The auto industry can't afford such things. Robots do the really simple work. People do the more complicated things, and they do the inspections and other checks required.

But this is only the tip of the iceberg in such absurd attitudes.

I'll just quote Jane Hamsher on the subject, since she wrote this before I did:

Funny, none of these bastards demanded wage and benefit cuts for Wall Street workers in the $700 billion bank bailout.

Auto Bill Fails In Senate, 52-35 — Say Good Night, Gracie

For some reason, no one seems to think that the people who have the power to make congressmen pay with their jobs for messing with them should pay any price. It's just the little people who have to pay a price.

Auto workers are overpaid? Don't make me laugh. The difference in pay between Detroit's executives and their foreign counterparts is astronomical. Chief executive officer (CEO) compensation has reached ridiculous levels generally in America, and shows no sign of subsiding:

"The average pay for chief executives rose to 369 times that of the average worker in 2005," Josh Fineman of Bloomberg News wrote on January 4. That was "up from 131 times in 1993 and 36 times in 1976, according to a study by Kevin Murphy, a finance professor at the University of Southern California."

Will Congress Reform Wretched Executive Excess?

This individual is neither exceptional in his callousness or his stupidity. I just happened to remember where this comment was. He turns out to be an employer, or so he claimed in a later comment. I've seen similar comments from workers in response to other articles. Whether it's the desire to keep their own labor costs as low as possible, or envy of people who do similar work at a higher wage, it's still shortsighted.

Auto executives who make eight figure salaries don't seem interested in sacrificing, so why should the workers, who are barely getting by?

[This is a slide from an article at Afferent Input about the growing income disparity in America.]

And here's one of the many other things people like this don't seem to consider. Those "overpaid" auto workers help make our pay higher. Other companies have to compete with Detroit for the skilled workers, technicians, engineers, managers, and accountants that they employ. That means our wages are higher. As unions have lost ground in the workplace, we've lost ground in the economy. All the real growth in wages has happened in the upper 10 percent of the work force. Unless you're in the top one percent, in fact, you've seen little change. The rest of us have been losing ground for the last three decades.

When you get right down to it, shortsighted, uninformed citizens who won't face up to reality deserve bad government. Our representatives seem motivated to give it to them. That's why I think we'll be extremely lucky not to be in a depression next year.

UPDATE: Looks like Sen. John Kerry may have had a good excuse for not being present at this vote - he was in Poland. That makes it less likely Reid could have prevented cloture. The defection of at least three Democrats and the absence, however understandable, of several others on this issue is yet another demonstration that having sixty Democratic Senators wasn't likely to change anything.

UPDATE 2 (Dec. 14): Over at Pacific Views, Walter Brasch provides some perspective on unions and their management:

Corporate America, instead of looking at their own excesses and incompetence, blames workers for the problem. But, the line worker is the one who builds something to the specifications of others but has no input into the decisions that cost the Big 3 their share of the market. For its part, the unions, blamed by almost every executive in America, has gone beyond what should be expected of a union.

The United Auto Workers, which extended major concessions to Chrysler in 1979, agreed to significant concessions in the 2007 contract, including allowing the Big 3 to hire manufacturing line workers at $14–16 an hour, about half of the current employee wages. By any standard, the workers have made far more concessions to keep the auto industry putting along than have the companies themselves.

Hit me Congress, One More Time: Bailing Out the Auto Industry

Unless you're stuck in a particular point of view, which is that unions are always the problem, you have to think that much of the blame lies elsewhere. That view hasn't changed the more I look at this thing.


One Fly said...

Well done Cujo and yes it's because of unions others get paid more.

I think this is the perfect example of how dysfuntional our government is at this time. Hell the dims need at least 65 to get a vote passed.

Your comment on a possible depression has merit. What is alarming is the rate the economy is failing plus job loss is falling of the table worldwide.

What I've been saying is that when the new congress convenes the same games will be played out in the senate. These republican senators care little about our country only their flawed ideology. They will make it so difficult to get needed legislation passed the dims and ultimately us will have to settle for something much less than it should be.

I just don't see these people assisting the majority in any way. This is not going to be pretty!

Cujo359 said...

Part of the answer is a rather simple one - make the Republicans filibuster. Every time. Make it widely known what they're filibustering and what it means to the country. My guess is that it won't go on too long. Reid has only called their bluff once, and even then he wasn't serious.

Until that happens, this will continue.

The economy, even at this stage, is probably fixable. There's capital out there, but no one is pulling it out of the vaults. Officially, they call the reason "lack of good credit risks" or some such. It really looks to me like there aren't enough people who have enough income to be good credit risks. It just takes willingness to revitalize the consumer sector, which basically means income redistribution. That's a dirty word for some reason, but the alternative is that we become a third world economy.