Union Busting or Sound Financial Management?

[Eamonn]

allenj,

As you might know I'm employed by the PA DOC.

I am a member of the PSCOA.

I have no idea how things are done in your neck of the woods.

For my part.

I think I do OK.

I have the benefit package that I was promised when I took the job and this was the main reason I decided to take the job.

The last Governor before he left office made a lot of changes to the pension plan for all State Workers who are hired after 1/1/2011.

I do not have the right to strike.

The contract we have in place now expires in July and both the Union and the Commonwealth will make their presentations before a neutral arbitrator.

All past contracts have been handled this way.

Yes I get a uniform allowance ($450.00 a year.) It might seem like a lot in light of all uniforms being provided, but it barely covers the cost of a couple of pair of boots a year and the cost of laundering the uniforms. Also as a member of the HNT I'm expected to purchase and pay for my own uniforms.

 

There are of course horror stories about people who the union has gone out of their way to help, when it might seem clear that these people were clearly in the wrong.

But I whole heartedly believe that the union has done and does a lot to ensure that the work conditions are safe. Not only for its members but also for the public especially for the public living near our institutions.

 

People who decide that they do not wish to belong to a union have the right not to, but do have to pay into Fair Share.

 

The newly elected Governor has said that he is not going to raise taxes. That must mean that there is going to be cuts.

We will know more in five days when he makes his budget speech.

Most often these pledges to not raise taxes are bull.

Sure the taxes at the state level remain the same, but the counties, towns and school districts have to raise taxes. The end result being that the tax payer still ends up more out of pocket.

I'm glad that I don't have the task of trying to present a balanced budget, cutting services can't be easy. Each and every group seems to be able to make the case that it is special.

There are areas where there is a lot of waste and services that might be better served by the private sector.

I'd be happy to see Pennsylvania get out of the liquor business and sell off the State Stores.

I'd be OK with cutting the size of our legislator and the perks paid to those in office.

I'm not happy when cuts lead to endangering the public and my view is that the unions play a part in not allowing this to happen.

Ea.

 

[Beavah]

Yah, BrentAllen, but then we have to continue to be honest, eh? Toyota plants are relatively new compared to GM. The Toyota work force is therefore younger on average than da GM workforce, by a considerable amount.

 

What does that mean? The GM health care costs with an older work force that have been doin' heavy labor in da factories for many years is naturally goin' to be much higher. And of course da Japanese component of da Toyota workforce gets free government health care.

 

The GM pension burden is also much higher. Toyota doesn't yet have many retirees, but GM has loads of 'em, and they're all living a lot longer than was projected when their pensions were established.

 

A younger workforce in heavy labor is also more productive, so Toyota benefits from that as well. But I don't think we want to encourage companies to lay folks off when they turn 40 and start to have aches and pains that slow 'em down a bit.

 

And finally, Toyota established factories in areas where the cost of living was low, so they could afford to pay less and still get good workers. GM factories were once in such areas, but their success improved da local economy so cost of living rose, and their salaries had to match that rise. It's hard to move an established plant.

 

So yeh aren't comparing apples to apples, eh?

 

Now, I agree with yeh like I said, the unions were foolish in not taking into account the economic cycle, competition, pension planning and all da rest. They could have been better partners with management, or perhaps insisted on higher management competence. But really, like Lisabob says,that's not their job. Those things are really management's job, eh?

 

And it was exceptionally poor management (with insanely high salaries) that sunk GM. When yeh look at exec pay vs exec performance between Toyota and GM, it's a lot more stark than da worker figures.

 

Beavah

[sherminator505]

If memory serves, George III had a House of Commons and a court system that was presumably based on the Magna Carta. So given your line of logic, why did the American Revolution ever happen, if a third of the colonists were against it?

[Eagledad]

>>And it was exceptionally poor management (with insanely high salaries) that sunk GM.

[83Eagle]

Last time I checked, George III wasn't popularly elected, nor was he subject to reelection. I suspect if the citizens of Wisconsin don't like what's going on, he will be defeated, or recalled.

[BrentAllen]

Beavah,

I'll give you that making apples to apples comparisons is hard. So, it comes down to opinions. Here is one, regarding the difference in pay between auto execs in Japan and the US:

 

It's difficult to get a precise comparison because Japanese companies are not required to include perks. "It's a very tough comparison to make," says David Cole, chairman of the Center for Automotive Research. The perks given to Japanese executives can include homes, chauffeurs, country club memberships. In the USA, "our disclosure on things like this is pretty complete. The first inclination is to say there's this huge difference, but I don't think that's true."

 

Here is another fact, from 2005:

Number of Plants in North America

Source: GM & Toyota

GM: 77, all unionized. Plans to close 12 facilities by 2008 (see press release).

 

Toyota: 12, three unionized in Long Beach, Calif., Fremont, Calif., and Tijuana, Mexico.

 

Is there a correlation between the number of unionized plants, labor costs and profitability? Looks like it to me.

 

More pearls of wisdom from our friends at the UAW:

 

By Bryce G. Hoffman / The Detroit News

 

WAYNE -- Ken Pool is making good money. On weekdays, he shows up at 7 a.m. at Ford Motor Co.'s Michigan Truck Plant in Wayne, signs in, and then starts working -- on a crossword puzzle. Pool hates the monotony, but the pay is good: more than $31 an hour, plus benefits.

 

"We just go in and play crossword puzzles, watch videos that someone brings in or read the newspaper," he says. "Otherwise, I've just sat."

 

Pool is one of more than 12,000 American autoworkers who, instead of installing windshields or bending sheet metal, spend their days counting the hours in a jobs bank set up by Detroit automakers and Delphi Corp. as part of an extraordinary job security agreement with the United Auto Workers union.

 

The jobs bank programs were the price the industry paid in the 1980s to win UAW support for controversial efforts to boost productivity through increased automation and more flexible manufacturing.

 

As part of its restructuring under bankruptcy, Delphi is actively pressing the union to give up the program.

 

With Wall Street wondering how automakers can afford to pay thousands of workers to do nothing as their market share withers, the union is likely to hear a similar message from the Big Three when their contracts with the UAW expire in 2007 -- if not sooner.

 

"It's an albatross around their necks," said Steven Szakaly, an economist with the Center for Automotive Research in Ann Arbor. "It's a huge number of workers doing nothing. That has a very large effect on their future earnings outlook."

 

*snip*

 

source: http://www.detnews.com/2005/autosinsider/0510/17/A01-351179.htm

 

 

[CalicoPenn]

The "Jobs Banks" have already been eliminated - in 2009. Even so, in 2008, the drain of the GM jobs bank was 0.17% of the amount they took in.

 

Here's what I don't get about the American People. The Unions raised the standard of living for all people in the middle class. Most people may not be in union jobs now, but the 40 hour work weeks, 2 weeks of vacation, sick days, decent working conditions, etc. all stemmed from unions standing up for the rights of workers.

 

Starting about 30 years ago, we've faced a sustained attack on the working people of this country. Not just union workers but all of us. If you were a non-union white collar worker in the 50's, 60's and 70's, you probably got a pension, just like the union workers did. By the time you retired, your pension was enough to allow you to live comfortably for the rest of your life. Not extravagently, but confortable. You aren't going to be eating cat food because it's all you can afford.

 

Then came a "better" idea - IRA's leading to 401k plans which eliminated most pensions for white collar workers. I recently read an interesting article that states that the average amount of money in the 401k plans of 55 year olds is $35,000. That isn't a payout of $35K per year - it's $35,000 total - with 7 to 10 years to retire, that is no where near what is needed to retire on.

 

And this is the part I don't get. Somehow we have been convinced that 401ks and IRA's are better than pensions when clearly they aren't. That has allowed a certain segment of the political class to convince a significant portion of us that unions, which try to raise our standards of living, are bad. That union pensions are bad because we don't get the same benefits. (And a corallary - they've somehow convinced a significant portion of us that a CEO getting a salary & bonus package worth millions per year while laying off fellow Americans to enhance the bottom line is good).

 

Somehow, instead of us looking to unions as a source of inspiration to fight to keep us at a higher level, some people prefer that we try to drag them down into the pit with us. Reminds me of watching a pot full of crabs trying to escape - just as one gets to the rim, the others pull it back in.

 

If you don't like unions, that's fine - don't join one. But stop pointing your fingers at them because your personal economy is miserable. Don't blame the unions, blame the people who really control your economic destiny.

 

 

[packsaddle]

Brent, that link doesn't seem to work. Could you check it and see if there's a problem?

[Beavah]

Yah, so BrentAllen, if some tom-fool of a CEO agrees to such a contract, isn't that his fault? Where is the management's responsibility to the board and the shareholders? The union is doin' its job of representing the interests of the workers. We can accuse 'em of being unrealistic or short-sighted, but they're at least doin' their job. Why didn't GM's very well compensated management do theirs?

 

Again, as an employer, if I were goin' to automate and as a result lay off a mess of people, I'd do what I could for 'em. That's just the decent Scout Oath & Law thing yeh do when you've had a good, loyal worker for many years and da business model changes. But I wouldn't jeopardize the business or the livelihood of other workers. It's management's job to do those things, eh? To treat its workers well and at the same time not to compromise the business.

 

It's like da boom and bust cycle has compromised our integrity. Yeh know yeh can't overextend during the booms or you'll surely bust in the downturns. Everyone knows that, or should. If you're a competent and conscientious manager, yeh have to live up to that responsibility. The penalty if yeh don't is bankruptcy, but it should also be shame. When was the last time one of these "I led the company to ruin" CEOs admitted that he was ashamed.

 

Beavah

 

[JoeBob]

Beavah,

 

I'm glad to see that you're supporting Gov Walkers efforts to tidy up the union contracts. After all, the point of your post is "if some tom-fool of a CEO agrees to such a contract, isn't that his fault?"

 

The previous Democrats in control of WI agreed to a 'tom-fooled comtract'. The contract is up for renewal. The new administration, (Sherm: Exec, Senate, and House - Not just King Walker...) are refusing to renew the tomfoolery.

 

Glad to have you on board.

 

 

[Lisabob]

The way to "clean up" what one perceives to be a mess of a contract is to negotiate different terms the next time around (or, in cases of exigency, to ask for a voluntary re-opening of the current contract - which the unions have all agreed to do in this case, by accepting the demands for wage and benefits give-backs). It is not to remove the right to negotiate at all.

[vol_scouter]

While one can argue the merits of union states versus right to work states, the issue in this case is different. The republicans running for the house, senate, and governor in Wisconsin and Ohio ran on the platform of decreasing the influence of unions. They won in large numbers and the democrats lost. That means that the republicans should be able to enact what they said that they would do. I have often watched republicans lose votes on issues that they believed to be important (recently, Obamacare) but they performed their elected duty. The democrats in Wisconsin are disgusting and clearly do not believe in representative democracy. If the voters do not like the republican reforms, they will return control to the democrats. The tactics being employed by the democrats in Wisconsin damage our representative democracy and set dangerous precedents. I hope that they return on Monday and perform their duty.

[Beavah]

Yah, JoeBob, I am on board, eh? The governor should negotiate a tough contract. The union has already agreed to substantial economic concessions, and that's a good and responsible thing. If you've read me these many months, yeh know I'm a fan of school choice, vouchers, eliminating tenure and seniority systems, bidding out health care and the lot.

 

I'm not as comfortable with da notion that rather than negotiate a contract, the governor should pass a law eliminating the workers' rights to bargain, and eliminating local control of their budgets by school boards and municipalities. Those are very different things, eh? Eliminating local control is not da sign of a real conservative, it's a sign of a fellow who wants to be king. And legislating away peoples right to bargain just crosses da Oath and Law line.

 

The ends don't justify the means, eh?

 

Beavah

[Eagledad]

>>Eliminating local control is not da sign of a real conservative, it's a sign of a fellow who wants to be king. And legislating away peoples right to bargain just crosses da Oath and Law line.

[CalicoPenn]

"The republicans running for the house, senate, and governor in Wisconsin and Ohio ran on the platform of decreasing the influence of unions"

 

I'm not going to let this slide. In Wisconsin, one of the bones of contention is that the Republicans did NOT, in fact, include decreasing the influence of unions in their campaigns. Had they done so, there is a good chance that the Governor would be Tom Barrett.

 

This trope that "the Republicans ran on this" is a spurious claim of certain conservative media personalities that doesn;t hold up under examination.

 

Not even Scott Walker will say this is what he ran on. This issue became contentious in Wisconsin because it was a surprise to every one.