Detroit, Detroit!
It’s a blunderful town,
The graft goes up,
then they burn the place down.
Jobs disappear down a hole in the ground.
Detroit, Detroit!
It’s a blunderful town!Apologies to Frank, Gene, and the gang.
Angry Immigrant note to self:
Borrow $500M from government, start a new manufacturing hub in northern Ohio. That way I can preserve 100,000 manufacturing jobs, while demonstrating what incompetent management comes out of the University of Michigan. The fact that these workers’ children will go to OSU in large numbers and grow up hating Michigan is just a bonus.
The “Auto Industry Crisis” is easy to solve. Before giving any more private companies any public money:
- Step 1) Get it out of Detroit. Anyone smart enough to be good management is too smart to move there. You’d have to bribe them, and the industry can’t afford it. Ohio seems like a good new place for it. Round on the edges and high in the middle… Use this move to:
- Step 2) Get it out of the UAW. Or re-educate the UAW about what actions you will accept. They’re one of several albatrosses around the neck of the U.S. auto industry, and they need to be taken down a few notches. The workers are necessary, the union is just like barnacles that need scraping off. The Department of Labor is their only friend, and the only one enforcing labor laws. Congress should write a neat little loophole into labor law that any company being bought into Gov’t receivership is now subject to special labor rules, including all-out ignoring current contracts. This will allow for massive flexibility in changes the government can force into the company. Use this flexibility to:
- Step 3) Purge the dross. High and low. Anyone making a multiple of a typical line-worker salary is gone. If they were so critically useful to the process, then they had the power to make it succeed or fail. They chose to fail. Their replacements will work on contingency, and be paid their fee once the company comes back out of receivership. Union dues are reset to $0 until all gov’t loans are paid back. Until my government money is paid back, not a cent goes to the bungler/crooks that caused the problems in the first place. This crisis is about preserving workers’ jobs, not their parasitic union fat cats’ jobs. They can start collecting regular welfare with the rest of the shiftless. The workers can feel free to organize. Their grievances will be heard by a special board at the Dept of Labor. Any work by a union organizer will be done on a volunteer basis. Then we’ll see how much the “workers good” they really care about. Until their employer buys itself back from me, John Q Taxpayer, I make the rules.
This will likely cause 2 of the big 3 to fail. I’m fine with that. Re-tool the assembly assets into making other things we will always need — garbage trucks, railroad equipment, forklifts, etc, and make a crapload of them. Use government-owned product designs so you don’t waste time and energy making ugly useless and unwanted slag any more. The surviving major U.S. manufacturer will be an efficient bastion of design, marketing, and manufacturing that we can be proud of. It will repay its debts to society and buy itself out of its government indenture. Then it can proudly show its face again.
But step 1 is getting the heck out of Detroit. And turn the light off when you leave…
-AI
December 3, 2008 at 1:17 pm
I probably should have commented on this earlier, being the closest thing to an Angry Man that works in a UAW shop.
I have thought hard about the concept of a Detroit bailout, “what’s good for GM is good for the country,” etc. I have a great deal of internal conflict on the matter, so, here it goes.
First, America does not need 3 car companies. I would leave it to the market to decide which one should bow out, but I guess thats the heart of the whole matter.
Second, America DOES need an automotive industry, just like it needs a steal industry. You can’t be a world power without military might to back it up, and you can’t have military might without a vibrant and efficient manufacturing infrastructure.
Third, re-tooling is a ridiculously difficult task. It would be like me suggesting that Intel retool to make vector processors instead of floating point. The building is there, and it has electricity and lights. There is nothing similar about making 1e6 Ford Tauruses and 1e4 garbage trucks, period. The “assembly assets” were put in based solely on economic considerations, not flexibility or adaptability.
Third, how much is Detroit really to blame? Americans wanted larger and larger cars (SUVs). Detroit retooled and spent the 5-7 requisite years to develop the platforms that marketing predicted would sell, you guessed it, 5-7 years from the time the decision was made. CAFE standards were put in place in direct opposition to customer desires. Which pays the bills better, exceeding emissions requirements or exceeding customer expectations?
Fourth, it is truly horrible that an entire metropolis is dying. How does the rest of the nation absorb these millions of people who have to pick up and move? They can’t sell their house, and they probably can’t find work anywhere else.
Fifth, the experience and talent isn’t out there to simply backfill after a purging of the “dross.” Management and UAW go back and forth, but basically get fat off each other. Its a crazy symbiotic relationship.
December 3, 2008 at 6:46 pm
“just like it needs a steal industry”
heh. Not what you meant, but full of delicious implications.
1st: agreed
2nd: agreed. What is has is a -crappy- automobile industry in Detroit, and an American-designed automobile industry in Asia-Pacific. We need to combine the good features of both to make an industry that is both domestic -and- profitable.
3rd: fair enough. It was an off-the-cuff attempt to solve #4. As to your CPU metaphor, Intel would benefit from that change. They’re making the exact same bet that Detroit made (we can limp along polishing an old development model for 30 years rather than make the major risky change to a new model that would dominate the industry for 15). And if Intel fails, they’ll make the same private jet journey to DC to ask for my money to salve their bad luck/decisions.
4th: In the intervening 5-7 years before we see a Ford Garbage hauler or Chrysler mega-dump truck, the staff could re-train for other work, start new businesses, and generally move Detroit away from being critically dependent on a single industry. It’s a mining town, and the mine is running dry. It never should have grown that big. It’s a preview of the disaster LA would be if people became sane about entertainers.
5th: If multiple symbiotes are parasitic to the same host, the host may be compelled to starve them out. I don’t want to pay for either of them because as you say, paying either of them ends up paying both.
Detroit could become the robotics capital of the world if they accepted the goal of completely automating the car fab process and put all of the workers and researchers to work building robots. They have a real need for lots of heavy lifting. They could provide feedback and testing grounds in volumes that you can’t get in a single metro area anywhere else.
As you say, the real problem is the retooling time. That’s the process I want to automate. It’s the 2nd derivative of automotive manufacturing…
December 12, 2008 at 7:02 am
It wasn’t the workers who blundered. The Unions only demand the same benefits Toyota pays in Japan — the big difference being that, in Japan, the government picks up the bill for health care, so that doesn’t show up directly in the price tag of the Toyota.
Cutting the union contracts, then, punishes the people who didn’t do anything wrong, and leaves entrenched the largest private bureaucracy int he world, the private health care system, which is also the most inefficient and wasteful bureaucracy in the world.
Maybe we should listen to the workers instead.
December 13, 2008 at 5:00 pm
If that’s true about the benefit parity, then the UAW has the foresight of a blind mole. Demanding benefit parity with a socialist government of a small homogeneous xenophobic nation obsessed with collectivist “sameness” is exactly the type of idea that doesn’t work in a large, diverse, individualist country like the U.S., and should be purged. Arguing that workers in the U.S. should have the same benefits as workers in a totally different social structure is a load of crap, and I don’t feel like paying for it.
I’m glad to see that Ford is excusing itself from the bailout. Maybe one of their execs looked up their company history and decided to follow the individualism of their founder.
The workers did everything wrong. Funding and supporting a parasitic union whose only real goal is to solidify its own power to the detriment of the company, its products, and all of the supporting industries is completely on the shoulders of the employees — no one else could give the boot to the unions.
I would much, -much- rather have a private bureaucracy than a public one. A private one can 1) be avoided and 2) eventually has to show a profit. Public bureaucracies are usually mandatory and unaccountable.
I’ll listen to the UAW workers once they are paid anywhere in the range of other manufacturing industry workers. Until that happens, you can all go back to burning your city to the ground…
-AI
December 13, 2008 at 6:10 pm
The private health care bureaucracy has given us third world health care at the highest rates in the world, leaving at least 15% of our people completely outside the system.
The private health care bureaucracy cannot be avoided, and it produces huge losses in every other industry — including autos, where the private health care system increases the annual worker costs by $40,000 by most calculations.
UAW workers ARE paid in the range of other manufacturing industry workers, especially if you subtract the health care costs.
Perhaps you should see your otologist. You may be suffering from oto-digital insertion.
December 13, 2008 at 10:08 pm
Where to begin?
You refer to health care as a single entity, but it’s a hundred different companies, with a wide range of price and competency. There are also doctors who work entirely on a cash basis in order to provide cheap, high-quality health care without regard to any kind of insurance company. Regardless, you can’t blame insurance costs as the reason that UAW workers need to be paid more, since everyone needs to buy health insurance.
And if health care is third-world here, then I’m mystified why the world continues to come here for their emergency surgeries. When even our enemies come here for lifesaving medical care, I have to believe that your low opinion of it is incorrect.
But to move back to my primary point (and yours, if your nemesis is bureaucracy), that large inflexible organizations tend to be inefficient as they grow drunk with their own power. Unions have their place, but they are primarily political tools at this point rather than assets to the well-being of workers.
If nothing else, they are your choice, not my necessity. From time to time, I want to buy a car. If UAW shops can’t produce cars successfully, other American-manufactured brands can. I’ll sleep soundly buying one of those.
http://www.weeklystandard.com/Content/Public/Articles/000/000/015/918gvijq.asp
This is America. If you want to worship the UAW religion, you’re free to. Just don’t ask me to pay for it.
December 14, 2008 at 4:23 am
Where to begin, indeed.
You seem to think that there must be a huge, single entity for a bureaucracy to be damaging, or even significant. Single provider, cash-only physicians do exist. They are insignificant in the overall business of health in America. None of them runs a hospital, for example. None of the cash-only guys can provide care for more than a few hundred people. The fact remains that nearly a third of the $140,000/year cost of an American autoworker goes directly to the “health care” industry. In Japan, in Germany, in Italy, in France, in India, autoworkers’ health insurance isn’t paid by the automakers, and so any plant located in those places has an automatic cost advantage over a U.S. plant. Are you serious about making U.S. automakers competitive, or are you joining the union-busting Republicans in the Senate who seek political revenge even if it means bringing down America?
I can blame insurance costs when they are the culprits for most of the cost differential.
If you think the world keeps coming to the U.S. for emergency surgeries, you’re missing the point. Health care is more than trauma care — and the fact that our physicians have more experience at gunshot wounds is a tribute to our wars and urban gestalt — that’s not something to be proud of, and it has nothing to do with the cost of health care for autoworkers. You’re more likely to die of heart disease in the U.S. than in almost any other industrialized nation. A heart attack will set you and your insurance company back $75,000 in the U.S. — but $15,000 in Canada for better care. If the Canadians can do it better for less, why should we continue to pay the insurance company executives for failing to deliver health care?
Fully 25% of the U.S. “health care” dollar goes to pay for a private bureaucracy whose sole function is to keep the 50 million uninsured Americans from getting health care. For that money, we could buy gold-plated insurance policies for the uninsured, and still have money left over to send AIG executives on a cruise.
Large inflexible bureaucracies, like the anti-union wing of the Republican Party, often become so drunk with their own power that, even when it wanes, they will drive into the ditch rather than confess their errors. UAW already agreed to massive givebacks, and they already agreed to more cuts in wages. Republicans held out to get the wages cut immediately in order to break the union. That was the sole sticking point on getting the bill through the Senate.
If you wish to worship at the altar of Big Money while the sacrifice of American workers continues, technically you have that right in the U.S. It’s unfair of you to ask others to donate their own pound of flesh for the sacrifice, I think. UAW workers have been getting the shaft consistently for the last 30 years. Insisting the workers fall on the swords of the bankers, consultants and large-bonused auto executives is really poor form.
December 15, 2008 at 7:07 pm
Roughly a third of my cost would go to health insurance as well, if I bought it on my own. Let’s both agree that health insurance costs are high, and for a variety of factors (inefficiency, inflexibility of offerings, highly unpredictable malpractice lawsuit costs, greatly increased average lifespan, and others). And agree that the U.S. is one of the few large nations where employers directly pay for health insurance (for wacky historical reasons that in my opinion need to be eased out). I’d be in favor of replacing this with a more direct system of personal health insurance purchasing. It sounds like you might be in favor of a nation-wide approach to funding heath insurance — or at least some national approach to providing affordable health care. It’s not clear which of those plans would be better, but I’d agree that either of them has the possibility of being better than what exists now. $45K/year is a lot, but affordable for people making $70K/year. $45K/year is unworkable for someone making $30K/year with no employer contribution — a situation which is all too common, and is the real tragedy in the situation — not me or the typical UAW autoworker.
My problem with large national health “services” is that it just replaces one rigid bureaucracy with another one. You can have any two of these three: cheap, effective, available. Our health care is effective and available, but not cheap. Canada’s seems cheap and effective, but often not available. The UK’s is just cheap.
The Republicans are out to get unions — but that’s a good move for them politically, since the unions as a PAC tend to operate at a pro-Democrat level even higher than their membership. The significant minority of pro-Republican unions members (not just the UAW, but across a variety of unions) tend to be upset that their dues go to support candidates whom they oppose.
Political parties — all of them — are right at the top of my list of people to blame for a lot of problems. (I’d gladly take the UAW before the Dems or GOP, because at least I don’t usually have to pay for the UAW…)
I’m just out to get anything that has a negative impact on the lives of Americans. From the information I’ve seen, this includes the UAW (and a number of other unions who operate closer to where I’m at in LA — the sad film industry ‘guilds’ that try to demand the same respect for writers as is due to people who work for a living.).
It also certainly includes the management at all levels of the Big Three for spending decade after decade being too spineless and unmanly to change. They folded their arms like stubborn children and refused to trim their (management) operations, but instead chose to play into the union’s hand by being anti-worker rather than what they should have done — become so pro-worker that the unions had no place. A world where unionized labor is unnecessary because of perfect management would be a wonderful place. While that’s an unreachable ideal, they certainly weren’t moving in that direction for decades.
It may or may not include the actual workers. I haven’t made up my mind. They may end up just being neutral in my opinion — since they actually do the work, which is good, but they also all continued to work in those crappy conditions for decades rather than retraining, switching careers, industries, companies, etc. I can’t imagine that a Ford autoworker couldn’t retrain to work at a Toyota plant in Kentucky (though I think that one’s very new).
I want every useful person to keep their job, and every useless person to find something useless to do. And I know the workers are going to get screwed in this deal, I wish it weren’t the case. I just don’t think that the UAW is going to help prevent that, I think it’s just going to make it worse.
My original point in the article was that the autoworkers for the Big Three would all benefit from doing the same work in a new location (in the US, but probably not in Michigan) with new management and (if needed) a new union. That they would benefit from competing against each other where the best workers get a real reward, and the worst workers get an opportunity to seek out a new career somewhere else…
Unless the government of Japan is funding health insurance costs of workers in Toyota’s and Honda’s U.S. manufacturing plants, I’m not convinced that the US heath insurance industry (broken as it is) is the reason for the high cost of manufacturing in Michigan. I’m open to other explanations, but you’ll have to shift gears from the insurance thing to persuade me.
December 17, 2008 at 6:45 pm
This looks bad for workers, but Chrysler has such a large existing supply that dealers are nearly panicking. If anyone wants to buy a Chrysler, now’s the time.
http://www.bloomberg.com/apps/news?pid=20601103&sid=aRa0jVzM922w&refer=us
I’m annoyed that my Chevy Volt is delayed yet again…