Monday, March 16, 2009

Haldimand "Warning, Reading this may Cause fits of Dizziness and Nausea"

A friend of mine read an interesting article to me over the phone in regards to the deal that was struck between GM and the Autoworkers Union. You can decide for yourself after reading this if in fact this deal is good enough for our government to give them money! In my opinion it is not!

The article is written by Greg Weston, Opinion Columnist for the London Free Press;


Deal by GM, union fails to impress
By GREG WESTON

Judging by all the breathless media coverage of the "historic" deal between General Motors and its Canadian union, one would think the autoworkers agreed to sacrifice their left lugnut for company and country.

Alas, objects in this mirror are much smaller than they appear.

The federal and Ontario governments have been demanding the unions take a tire-iron to their gold-plated employment contracts before GM gets a dime from taxpayers.

With upwards of $7 billion in government loans on the table, GM and its workers have oh-so- reluctantly agreed to a deal, which union president Ken Lewenza describes as "a major sacrifice by our members and retirees."

Here are some of those heart-wrenching sacrifices, with a warning that what follows may cause ordinary hard-working taxpayers to experience fits of dizziness and nausea.

* The deal freezes base wages until mid-2012.

In fact, it changes almost nothing -- last year, the union agreed to a pay freeze until mid-2011.

* Quarterly cost-of-living increases are suspended until 2012.

Those pay hikes had already been suspended until mid-2010, and with inflation near zero, the increases wouldn't have amounted to much anyway.

* Ditto for annual cost-of-living increases to pensions until 2012.

Increased pensions had already been nixed for a year, and with low or no inflation, GM pensioners will barely notice them missing for another three years.

It is worth noting that unionized GM employees do not contribute a dime to their pensions during their working lives.

We would also note that at a time when the car companies are asking for billions, the GM pension fund is short, um, billions.

* Spa time is reduced by 40 hours per year.

Before your head explodes, "spa" stands for "special paid absence," an extra week of paid time off that all GM unionized workers get in addition to their annual vacations.

A union exec explains spa weeks were originally negotiated in part to force GM to hire more workers to replace the ones on spa weeks.

This also helps to explain why the company is now broke.

* "An annual $1,700 special bonus payment is being diverted to help offset the cost of retiree health care benefits."

Translation: Unionized autoworkers are giving up their $1,700 Christmas bonuses so their retired brethren will each get an extra roughly $250 a year to cover new health premiums (see below).

The net benefit to GM -- and taxpayers -- is precisely zero.

* GM is cutting its contribution to a whole range of employee perks by a third.

Those include subsidized daycare and even legal services for union workers buying a house or getting divorced.

* Finally, unionized auto workers will have to pay a staggering $30 a month each for their health and other benefits; retirees $15.

Truth is, all those years of huddling around the flaming oil drums on the picket lines have left the auto workers with the sweetheart of all benefit packages covering health, dental, disability and even tuition.

Until now, the employee contribution to the premiums has been exactly zip.

Add it all up, and the "major sacrifices" being made by the autoworkers for billions of taxpayers' dollars are as follows:

Their pay and pensions stay the same. They lose a spa week, and give their Christmas bonus to the oldtimers. They have to pay a bit more for daycare and a divorce, and $30 a month for a benefits package to strike for.

Hold the hankies.

http://lfpress.ca/newsstand/News/Columnists/Weston_Greg/2009/03/10/8688506-sun.html

9 comments:

  1. And people complain about teachers....
    If I had the numbers on the tip of my fingers, I would let you know what percentage teachers pay for their pension plan and benefits. It's nothing like GM workers.

    ReplyDelete
  2. "The federal and Ontario governments have been demanding the unions take a tire-iron to their gold-plated employment contracts before GM gets a dime from taxpayers."

    The governments have their answer! No Taxpayer money to GM!

    ReplyDelete
  3. I thought bonuses were supposed to be for a job well done, performance and an annualaward for achieving profitablity... I see no success in the auto industry workers, nor do I see that any kind of bonus is justified. The government must impose a cap on wages for all autoworkers, including the brass league in order to qualify for bailout funding. That wage cap should be equal to no more than 2x minimum wage including benefits until 2012. Of course their current benefits package alone would exceed that cap, so their paycheques would become nil. The auto workers must decide whether they want wages or benefits, because us unemployed taxpayers can not afford to support both.

    ReplyDelete
  4. I realize the impact to economy for GM and other big 3 to close plants. However, to be perfectly honest I am insulted that we would even consider giving tax money to compensate a company for complete and utter mismanagement of their business. Incompetence of this magnitude should be allowed to fail or have to fend for themselves. Other industries have declared bankruptcy in the past and have come out better for it with a renewed, leaner corporate structure and more refined business model. GM’s current situation revolves around nothing more than corporate greed and complete lack of foresight in both its existing financial structure and the direction of the commercial market. GM exec’s clearly have had blinders on for the past 10 years and only had goals to further their salary & bonuses in any given year. They are quick to point the finger at the crashing global economy for their predicament when as they had to do is clean out their own closest. As taxpayers we should voice against bail outs of this magnitude which clearly only going to shore up an already crumbling dike. GM needs to clean house in a big way and start making products that the consumers are willing to invest in. I drove domestic vehicles for years until I grew tired of replacing mufflers that fell off at 55,000 km and replacing head gaskets and water pumps every 2 years. Enough is enough... Build a better product cheaply and efficiently and the world will beat a path to your door. Totyota, Honda, and the Euros can do it…why not the big 4???

    ReplyDelete
  5. THE LABOR COST INCLUDING BENEFITS IS VERY LOW FOR THE AUTO FACTORIES. IT IS ABOUT 3%. TO BUILD YOU A NEW HOME THE LABOR COST IS ABOUT 60%. FOR EVEY PART ON AN AUTOMOBLIE TO INSTALL IS ABOUT $.74 CENTS EACH. WHERE CAN YOU TAKE YOUR CAR FOR EXAMPLE AND HAVE THEM INSTALL A NEW BATTERY FOR YOU FOR ONLY $.74 CENTS FOR THE LABOR COST? ALSO GO ON THE LINE IN THE FACTORY AND INSTALL 60 OF THEM EACH HOUR FOR 8 HOURS AND THEN TELL ME THE WORKERS ARE OVER PAID.

    ReplyDelete
  6. I always sρent my half an hour to read this wеbpagе's articles every day along with a cup of coffee.

    Here is my blog post :: tens unit

    ReplyDelete
  7. Gгeat агtіcle.

    Also visіt mу site ... Www.dallasseocompany1.com

    ReplyDelete
  8. Hello, aftеr reading this remarkable piece of
    writing i am alѕо glad to share my еxρeгiеnce here
    with friends.

    Feel fгеe to viѕit my ωеblog http://www.Tensmachines.biz

    ReplyDelete