From the Heritage Foundation an endorsement of Right To Work Freedoms for Michigan:
Did you know that there are no Volkswagen manufacturing plants in the Detroit area? Or Mercedes-Benz? Or Kia? Or Hyundai? Or BMW, for that matter?
Apart from having their cars assembled in Michigan, it turns out that those three companies have something else in common: the United Auto Workers union (UAW). It also turns out that every other car manufacturer has something in common, too: not wanting the UAW to do to them what it did to the Big Three.
Today, President Obama will address the UAW, and he should receive a rousing welcome. After all, his terms of the auto bailout richly rewarded his union allies at the expense of non-union employees and private investors, giving them, among other prizes, a very large stake of ownership in Chrysler. And together, they stand adamantly opposed to “right-to-work” laws that would empower the nation’s unemployed to find economic security with a non-union job.
They claim they want to protect “the American auto industry,” but this is not about “American cars.” The controlling interest of Chrysler is Italy-based Fiat and previously was Germany’s Daimler-Benz between 1997 and 2008. This is simply about protecting union fortunes.
Chrysler can hire actors in Louisiana to play the part of Detroit workers, and it can produce cinematically brilliant television ads. But wouldn’t Detroiters have more pride in a job than a commercial? Chrysler and the UAW must drop its opposition to Michigan’s right-to-work legislation if it wants to pretend it cares.
Right-to-work legislation protects employees from being fired for not paying union dues. Without that protection, workers are forced to support a union financially even if they’d rather spend their hard earned dollars at home, if the union contract harms them, or if they’re opposed to the union’s agenda. And if they don’t, they lose their jobs. Obviously, when given the freedom of choice, many workers choose not to unionize.Twenty-three states have right-to-work laws. But in Michigan, the powerful unions are preventing this job-creating measure from succeeding. And it is costing the state’s workers dearly.
As Heritage labor expert James Sherk recently noted: “Union organizing activity drops in half after a state becomes right-to-work. This attracts investment. Businesses want to know that, if they treat their workers well, unions will leave them alone. Right-to-work makes that more likely and businesses notice…It was no accident that Boeing built its new 787 assembly line in right-to-work South Carolina.”
As a result, manufacturing employment is over 30 percent higher in right-to-work states. Since 1990, the majority of new manufacturing plants by foreign automakers have been built in southern right-to-work states like Alabama, Georgia, South Carolina and Tennessee.
And while unions may offer their members certain benefits that are desirable, if not unsustainable, what they don’t offer is job security. Unlike in efficient, non-unionized manufacturing operations, unionized manufacturers are often forced into rounds of layoffs. There are about as many non-union manufacturing jobs today as in the late 1970s. During that time three-quarters of unionized manufacturing jobs have disappeared.
So when Chrysler started running ads during the past two Super Bowls touting itself as a savior of Detroit, as its beacon of hope, it was perplexing.
Chrysler employs a little over 4,000 employees in the city of Detroit, with 1,100 of these jobs recently “added,” as Chrysler would say. In reality, these were previously-downsized jobs restored.
By contrast, according to Kia, more than 10,000 jobs were created by the opening of its plant in West Point, Ga., in 2009, and it’s still expanding. The Mercedes-Benz plant in Tuscaloosa, Ala., has 4,000 line workers. Volkswagen and Hyundai both built plants in the last ten years that employ 2,000 workers. And the list goes on.
UAW-owned Chrysler’s opposition to right-to-work discouraged these auto manufacturing jobs from being created in Detroit, [and] UAW president Bob King is leading an effort to amend the Michigan constitution to permanently block right-to-work laws.
If you think it’s too late for Detroit, think again. Indiana recently passed right-to-work legislation, and according to the Detroit News, Caterpillar almost immediately shuttered a plant in Ontario, Canada, (where coincidentally it was locked in a labor dispute with a union) and announced a new plant in Indiana. Caterpillar also recently scrapped plans to build a plant employing 1,400 people in heavily-unionized Illinois citing the “business climate” and rumors are it will instead build that plant in right-to-work North Carolina.
We cannot continue to repeat mistakes and continue to offer Detroiters the same broken policies that turned a shining city into a busted mess. If the city ultimately fails, it will be a great symbol of the liberal philosophy of managing decline through dependency. If Detroit succeeds, it will be because its citizens were offered more choices, more freedom, more jobs, and more economic opportunity.
In a series of hard-fought organizing drives that began in June 1989, Freightliner workers at the Mount Holly plant (North Carolina, a right to work state) voted for UAW representation in April 1990 (now 1500 UAW members). They negotiated their first contract in December 1991, and three subsequent agreements in 1994, 1997 and 2000. These contracts were not only advantageous for members, but also left the company with a competitive advantage.
A few years later at three other Freightliner plants in North Carolina – Gastonia (now 780 UAW members), Cleveland (now 2000 UAW members) and the company’s Thomas Built Buses facility in High Point (1049 UAW members)– the UAW and DTNA reached an enforceable neutrality agreement. This meant Freightliner agreed to stay out of the workers’ decision in organizing with the UAW and recognize the union. In short order, the UAW reached a majority at all three plants and was recognized by the company.
It isn’t rocket science. Workers know they come out ahead when they have a say in their wages, benefits, health care, health and safety, and other workplace issues. Being able to decide in an atmosphere that is calm and free of threats is critical – and that’s what neutrality agreements are all about.
The UAW does not own Chrysler as this article states. The shares are owned by the UAW Retiree Trust Fund which is a VEBA account. The union does not benefit from the shares. Any profits from the sold shares go to providing pension and benefits to Chrysler Retirees through the Trust Fund. The VEBA owns the shares because Chrysler was unable to meet their financial obligation to the fund.
General Motors and Ford have similar VEBA accounts. The VEBAs were formed in order to get the costs of retiree healthcare off the books of the companies. GM is like Chrysler in that they too were unable to meet their financial obligation the fund. Ford has maintained its obligation to the fund.
Had the VEBAs not been formed, nearly one million retirees would have lost their pensions and benefits. These costs, although reduced, would have fallen to the federal government one way or another through the PBGC plus the fact that people could no longer afford healthcare.
Had Chrysler and GM been allowed to go bankrupt, the country would have gone into depression as 1 in 6 jobs is related to the auto sector. The supply chain, which all of the manufacturers share in common including the Japanese, would have collapsed, which would have taken down all of the companies including Ford, Toyota and Honda. President Bush, who OK’d the bailouts, said given a choice he would make the same decision.
The article says that there are no Vokswagen, Mercedes Benz,, Kia, Hyundai, or BMW plants in the Detroit area. This is true. But in their home countries, all of these companies including Toyota and Fiat, are unionized companies because those companies have stronger labor laws in regard to unions than do the United States.By the way, Freightliner, a subsidiary of Daimler Trucks North America, a manufacturer of big trucks, has a plant in Mount Holley North Carolina, a right – to -work state. The hourly workers in the plant are represented by the UAW.
The article implies that companies that do not have unions do not have layoffs. Of course this is not true. There is no more security in a non-union workplace than there is a union shop. In fact there is less security in a non-union shop as the company can layoff whom ever they want when ever they want, and not bring them back, while they may bring back someone who hunkers up to the boss. It is to the unions benefit to keep as many people employed as possible so they will continue to negotiate with the company to get the workers back on the job.
The same paragraph implies that companies with unions do not have efficient facilities. Compitition demands that facilities be efficient, world -class facilities.
The article talks about Chrysler adding 1100 jobs in Detroit, but then says those were downsized jobs restored. Who cares? They are jobs in a much needed area of the the USA. In reality, the jobs were not restored; the new hires make about half the wages and have many less benefits than their older co-workers. This is because of union concessions in order to keep the company competitive with companies that pay less in the same industry in right-to-work states.
The purpose of unions is to raise wages and benefits; the purpose of companies is to pay and provide as little as possible to employees while while maximizing profit.
Brian,
Thanks for the advice, but it’s not the name calling that I was reacting to. The poor fellow works himself into a lather every time he sees one of my posts. I was starting to get a little worried for him.
-michael
PS: “For the record”, I don’t much care whether you or anyone else takes me seriously here.
“Easy there partner”? After a post that used “clown” and “whores”?
Just for the record, if you want to come across as a serious proponent of a viewpoint, name-calling does not help.
“Matt”,
Easy there, partner. Relax.
-Michael.
PS: If you were able to see me, I can guarantee that the word “thug” wouldn’t even cross your mind, friend.
Mikey would you please go away you blithering,trolling idiot of a so-called Union thug-apologist. We know what you jobs-killing, anti-economic liberty, corporatist, rent-seeking douche bags have to say. It the same old tired bullsh!t. Seriously its boring and annoying and its just plain stereotypical of the brainwashed.
You describe James Sherk as a “Heritage labor expert”. Nice try. That’s like calling that absolute clown, Rush Limbaugh, a “right-wing talk radio Democrat expert”. Thinking people will turn to the likes of James Sherk or any of the high priced whores at the Heritage Foundation for “expert” advice on labor matters right about the time that Rush and the other pigs grow wings and fly.
What really scares the union leaders are the rank and file who disagree with the politics they are being force fed. Many of them are conservatives who voted and will vote against the current regime. As long as the leaders pockets are lined they do not care about their own workers.