Saturday, June 13, 2009

OBAMA, CHRYSLER, & THE UAW--A MARRIAGE MADE IN A BACK ROOM

The United Auto Workers Union sent an interesting letter to its members explaining the results of the Chrysler bankruptcy.

The letter should also be interesting to those of us who foot the bill. Remember, too, that the GUARANTEED BONDHOLDERS (in Delaware where Chrysler is headquartered, bankruptcy law dictates that bondholders receive their money first) investers representing pension funds, etc.--received less than $.25 on their dollar.

The union said that under the plan, they saved the hourly wage, the pension plan, and the health benefits members enjoyed. Unexplained but mentioned in the letter was that they had agreed to a way to slow foreign competition. The letter listed China (huh?) and other countries--like Japan, I guess.

Yesterday the press did report that the UAW did make MAJOR concessions: they gave up two paid holidays, one being the Monday after Easter. They will no longer be paid for unused vacation time; THEY WILL JUST HAVE TO USE ALL THEIR VACATION. Boo Hoo. They agreed not to strike until 2015.

Why would they strike? They own a huge share of the company and would be striking against themselves. Picture negotiations. The negotiators come with two hats and change them each time they leap across the table to participate, sometimes as an owner, sometimes as a union worker. Negotiations could be very tiring and only fit for the athletically strong.

It's nice to know how well the union has been paid by the Obama administration for its support and how in-the-pocket union members are for the next presidential election. They more than balance out the screwed over bond holders whose guaranteed bonds really were TOXIC PAPER.

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