Living and breathing in the Second City
From someone who knows. (Borrowed from www.Regularfolksunited.com):
Four generations of my family worked in General Motors Plants. My great grandfather, grandfather, father, brothers and I all worked for Buick Motor Division in Flint, Michigan. After working my way through college at the Buick Engine Plant, I became an economic analyst and then a supervisor at another GM plant. My family was so loyal to General Motors that we considered a Ford a foreign car. This is why it makes it particularly painful for me to say that there should not be a bailout.
I have agonized over this at length. If my brother sees this editorial there won’t be presents exchanged this Christmas. Let me lead you, and my brother, through my torturous thinking process.
First, I believe that sending the government to bail out the auto industry or an industry at this time is like sending an arsonist to put out a fire. The government is partially to blame for the problem with the auto industry.
The government created the credit crisis by forcing lenders to make bad loans and the resulting credit crunch made it difficult to sell cars. Democrats in Congress (even some from Michigan) are responsible for blocking domestic oil production in the United States which has driven up gas prices and sent our wealth and potential American jobs to the “bad guys”.
One would think that since the government created the crisis, they should fix it, right? No. They should STOP messing with the markets, not mess with them more! They should let lenders make prudent loans and let energy producers produce energy and they should let the automakers get out of this mess without government help or interference. They should not send folks with gasoline to put out a fire. Congress doesn’t just want to “bail out” the Detroit Three, they want to add on their own restrictions to make Detroit “green”.
Second, as a former supervisor of UAW workers at a GM facility, I will say that poor management and union malpractice made the Detroit Three uncompetitive long before the government sent in their arsonists.
To put it bluntly, the UAW takes the hard earned money of the best workers and spends it defending the very worst workers while tying up the industry with thousands of pages of work rules that make it impossible to be competitive. And the spineless management often makes short sighted decisions to satisfy the union and maximize immediate benefits over long term sustainability.
The strength of the union and the weakness of management made it impossible to conduct business properly at any level. For instance, I had an employee who punched in his time card and then disappeared. The rules were such that I had to spend hours documenting that this man was not in his three foot by three foot work area. I needed witnesses, timed reports, calls over the intercom and a plant wide search all documented in detail. After this absurdity I decided to go my own route; I called the corner bar and paged him and he came to the phone. I gave him a 30 day unpaid disciplinary lay off because he was a “repeat offender”. When he returned he thanked me for the PAID vacation. I scoffed, until he explained: (1) He had tried to get the lay off because it was fishing season; (2) The UAW negotiated with GM Labor Relations Department to give him the time WITH PAY.
I supervised a loading dock and 21 UAW workers who worked approximately five hours per day for eight hours pay. They could easily load one third more rail cars and still maintain their union negotiated break times, but when I tried to make them increase production ever so slightly they sabotaged my ability to make even the current production levels by hiding stock, calling in sick, feigning equipment problems, and even once, as a show of force, used a fork lift truck and pallets and racks to create a car part prison where they trapped me while I was conducting inventory. The reaction of upper management to my request to boost production was that I should “not be naïve”.
One afternoon I was helping oversee the plant while upper management was off site. The workers brought an RV into the loading yard with a female “entertainer” who danced for them and then “entertained” them in the RV. With no other management around, I went to Labor Relations for assistance. As a twenty five year old woman, I was not about to try to break up a crowd of fifty rowdy men. The Labor Relations Rep pulled out the work rules and asked me which of the rules the men were breaking. I read through the rules and none applied directly of course. Who wrote work rules to cover prostitutes at lunch? The only “legal” cause I had was an unauthorized vehicle and person and that blame did not fall on the union workers who were being “entertained” but on the security guards at the gate. Not one person suffered any consequence.
Another employee in the plant urinated on the feet of his supervisor as a protest to discipline. He was, of course, fired…that is until the union negotiated and got his job back.
Eventually I was promoted to a management position where I supervised salaried employees at HQ. As I left the plant I gave management a blunt message. I told them that I expected the union to act like the union, but I was disappointed that management didn’t act like management.
This is why, with deep regret and sympathy for the many fine folks who work in the auto industry, I think it is time for consequences. Let them file Chapter 11 and reorganize. Let management act like management and the union stop destroying our competitiveness. And let the government get out of the business of business.
The fog comes
on little cat feet.
It sits looking
over harbor and city
on silent haunches
and then moves on.
-Carl Sandburg
DGM
November 24th, 2008 at 9:22 am
I agree 100%. Let the auto industry FAIL…ignore the hyperbole about millions of jobs being affected, and let the auto industry FAIL…perhaps then and only then Management will affectively manage, and the labor unions will actually lose some of their RIDICULOUS power and benefits this letter writer outlined and witnessed first hand.
Rob_N
November 24th, 2008 at 10:36 am
A few faulty premises at the start of this missive…
- forcing lenders to make bad loans
That’s an urban myth conveniently propagated by conservative partisans. Not a single person has yet found the language in the CRA or any other legislation which “forces” lenders to make bad loans.
On the other hand, there is plenty of evidence that the deregulation environment initiated with Reagan and stepped up by former McCain economic advisor and former Senator Phil Gramm led directly to lenders which made ever-weaker loans and even falsified loan documents and lied to loan applicants in order to earn their commissions on more and more loans.
CRA has nothing to do with creditors making loans that common sense would indicate should not be made. All CRA regulates is that lenders must apply their lending rules equally and fairly no matter the race of the applicant or economic status.
If the lenders rules are faulty in the first place, the CRA had nothing to do with it.
- and the resulting credit crunch made it difficult to sell cars.
Yes and no. If people can afford a loan they can still get one. They might have to jump through a few more hoops to prove they can afford the loan, but loans are still available.
- Democrats in Congress (even some from Michigan) are responsible for blocking domestic oil production in the United States
Where is the evidence that opening up off-shore oil fields that make up a few percent of global oil resources would have any effect on gas prices now, considering that production of those off-shore fields won’t actually turn the crude into gas for about 20-30 years?
On the other hand, if the Big Three had bothered making cars that are more fuel efficient this wouldn’t have been nearly as big an issue as it turned out to be for all the SUV owners out there.
PS: Gas prices started coming back down before the off-shore leases were opened up earlier this fall … and have been steadily falling for several weeks now not because more rigs can be plopped in the ocean, but because people are conserving more gas.
T.J. Schwab
November 24th, 2008 at 10:20 pm
Rob - Thank you for mentioning the CRA and Gramm - because I am embarrassed to admit that I have read both the CRA of 1977 and the GLBA of 1999 (which I assume is what you are referencing in your literary wrist slap to Sen. Gramm). Very tedious indeed but happy to have read them for moments like these.
You are correct in stating that both acts do not force banks to do anything, however receiving a less than satisfactory rating for compliance does hold major consequences (or penalties, if you will) for financial institutions and THAT is the force. The GLBA was passed only after Pres. Clinton demanded an update be added to the bill that strengthened the CRA of 1977. That was Gramms concession in order to get the deregulation part of the bill passed. The amendments to the CRA in the GLBA continue the pattern of consequences for banks that receive a less than satisfactory.
So what you have is a committee in Washington, without any regard to the situation in a particular local community, ready to label the financial institution as discriminatory, racist, bigoted, sexist if they do not meet THEIR standards of quote - meeting the needs of the community - end quote - in which the bank exists - a community (and a risk level) that the bank knows best. On top of that, over the course of the past 30 years, Congress has tied further consequences (eg. Bank A cannot buy Bank B if either bank has a less than satisfactory CRA rating) to subsequent financial legislation.
I think you can begin to see where a bank feels forced into making more and more high-risk loans in order to meet the rules of the committee. What must they do to meet the standards? What makes the review committee award an outstanding rating as opposed to say, a less than satisfactory rating which would inhibit (by law) their future opportunities for profitability? More risky loans they demand???? One more sub-prime mortgage to go please!!!!
T.J. Schwab
November 24th, 2008 at 10:30 pm
Rob, please point me toward the following evidence for my own research that the policies of Reagan and Gramm…Quote…led directly to lenders which made ever-weaker loans and even falsified loan documents and lied to loan applicants in order to earn their commissions on more and more loans.
Just my opinion, but I find nothing in the GLBA that paves the road to the falsification of loan docs and therefore would be interested to read your sources.
T.J. Schwab
December 6th, 2008 at 12:20 pm
Guess that will teach me to hold my breath for two weeks whilst waiting for the “plenty of” supporting links to Rob_N’s claims. Why do I ever think their views are supported by substantiated fact?