Saturday, December 06, 2008

Making bail

The news since Election Day has been mostly filled with talk of the next administration which is akin to following the pre-season in sports. Well, as many Michigan residents may know the Lions went an undefeated 4-0 in pre-season and have yet to win any games in the regular season (0-12 as of now). For that reason, I've pretty much been ignoring most news lately.

The other big story has been the proposed "bailout" of the "Big 3" sort of-U.S. based automakers. Sadly, the manner in which the issue is discussed is the same old sensationalism and sponsor-based propaganda. I'm pretty sick of politics because I'm tired of the same arguments from the same people. And here we go again, more Monday morning businessmen telling the Big 3 how they should be run which becomes a sort of sick comedy when it's a Senator who has helped run up the debt and the deficit. It's even funnier when it's a newspaper editor or publisher in a dying industry that is losing jobs faster than Detroit telling us how to run the national economy. Except it's not funny when people are losing jobs and homes and health care.

Now, Congress acts as if it's not responsible for the dire straights of the automakers when they approved tax breaks for people to buy large SUVs for their small businesses when a smaller vehicle would have done the job, failed to pass stringent fuel-economy standards or instituted some sort of price controls to keep gasoline prices at a rate which would allow alternative energy to compete or done away with the tax breaks for "Big Oil" which allowed them a competitive advantage. It's also obvious how much our reckless trade deals have other countries sell their products on our shores while sending the profits to their overseas headquarters.

While it's true the automakers contributed to the mess, it seems odd to hear them get blamed for what is American business 101: maximize short-term profit and to hell with everything else. We now live in a country where many seem to equate regulated capitalism with socialism so it seems funny to hear those same advocates of unregulated markets turn around and blame the Big 3 for doing what was in their shareholders best and most immediate interest- a central tenet of capitalism! I find it odd that a culture that celebrates money above all else suddenly wants to wag it's finger at an industry that pretty much followed those rules.

Of course, to hear some people tell it, the real villains are the money-grubbing workers who wanted to be paid well for back-breaking labor which most people won't subject themselves to.
In their warped world-view the UAW is to blame for all of this. Let me say this clearly: the job of the union is to advocate for the employees. When they negotiate wages and benefits they are out to maximize what their members receive. It is the job of the corporate representative to negotiate with the best interest of the company in mind. The CEOs signed off on every single deal. If they thought wages or benefits were too generous it is up to the CEOs to not sign the deals, period. In fact, since Reagan's election in 1980 unions have been under seige and on the decline, yet almost 30 years later they are still a convenient whipping-boy of the corporations and the media who would like to ignore all the free trade agreements and other deals which created the mess we're in.

But let's get to one of the biggest unspoken and underlying reasons for the mess we're in: other countries can make products cheaper because health care costs are killing American companies and crippling their ability to hire new workers even in good times. The idiot's answer is to gut the benefits. Everyone else can clearly understand that if we took away the need for companies to supply health benefits then they'd be free of that burden and workers would no longer fear leaving their jobs because of the fear of losing health care benefits.

In fact, I maintain one of the biggest strangleholds currently on the entrepreneurial spirit in this country is people scared to start their own business because they risk having to go without health care. Imagine if health care was guaranteed how many new businesses could be developed? Some workers aren't even allowed to work over 35 hours because the company would then be forced to label them as full time and pay benefits which means lots of people might have jobs but nobody can pay their bills and they don't have health care when they get sick (they go to the emergency room which costs more which we still end up paying for which forces health care costs up even higher).

The good news is that this is being discussed. The bad news is that the discussion is still controlled by the same people who's economic solutions are akin to a medieval doctor who's cure just might kill the patient sooner than the disease. It just reminds me: what's the opposite of a bailout? Drowning...

12 comments:

agnosticrat said...

The economic conservatives love to play chicken with the economy, not realizing that they are burying themselves in the eyes of the American worker with their misguided dogma. While they want nothing more than an end to organized labor, they are willing to watch the country fall into a deeper economic depression to achieve that goal.
The fire they play with is called classism.
A loss of jobs as large as projected (if loans are not made to the big three), after granting bailouts for those who make cash on wall street will only polarize attitudes separating business,and working class people further.
I suggest they look up from their economic bibles, long enough to brush up on history. The sit in at Republic Windows & Doors is not that far away from Haymarket square.

dmarks said...

"Now, Congress acts as if it's not responsible for the dire straights of the automakers when they approved tax breaks for people to buy large SUVs for their small businesses when a smaller vehicle would have done the job"

Smaller cars that can't hold much, are less safe, and are flimsy don't necessarily do the job as well.

" Some workers aren't even allowed to work over 35 hours because the company would then be forced to label them as full time..."

I've seen this all over. This is a direct result of government policies mandating special benefits for full-time workers. It is basically the government encouraging companies not to hire full-time workers.

dmarks said...

" yet almost 30 years later they are still a convenient whipping-boy of the corporations and the media who would like to ignore all the free trade agreements and other deals which created the mess we're in."

Free trade has made things a lot better, by the way. The only people who complain about it are those who overcharge for stuff, or just aren't very good at their job.

agnosticrat said...

"I've seen this all over. This is a direct result of government policies mandating special benefits for full-time workers. It is basically the government encouraging companies not to hire full-time workers."

Social security, unemployment insurance, workers' compensation,and maternity leave are not exactly the kinds of things most workers would consider "special" benefits. Of course they could be if you were to own sweat shops in China, or Mexico, or India. Which could explain your outlook on free trade.lol

dmarks said...

Social security does not count. I am referring to the benefits that kick on above a certain number of hours a week, each at a large cost to the employer. Of course these encourage the employers to keep the hours under the threashold.

Free trade is fair trade. It has nothing to do with "sweat shops"

agnosticrat said...

I fear you are being vague on purpose. You have an opportunity here to explain what these elusive government mandated "benefits" are. Please do so, or I will use your comments to illustrate the definition of a straw man argument.

dmarks said...

So, do what I tell you, or you will make up stuff? That's not the best.

dmarks said...

Anyway, here are a couple of links on the effects of unfunded mandates that employers provide unearned benefits, and well-meaning supposedly "pro-worker" regulations that actually encourage employers to cut benefits:

http://findarticles.com/p/articles/mi_m1038/is_/ai_13183237

http://www.ncpa.org/ba/ba167.html

dmarks said...

@agno: "While they want nothing more than an end to organized labor"

I don't want to see an end to it. I just want membership to be voluntary. To level the playing field with every single other political interest group, none of which has mandatory membership.

i.e. I think it is fine that people join the NAACP. I just don't think that any person should pay dues to it unless they choose to join. Does this mean I want an end to the NAACP? Of course not. The same with my preference to make union membership voluntary.

el grillo said...

Voluntary union membership is a joke. Only a very stupid person would apply for a job and not know that union membership was or was not part of the deal.

el grillo said...

Better health care is available for 15% of what it costs in the USA.

Those who try to sell the idea that all workers outside of the USA work in "sweatshops" apparently have never left Barry County and can´t read. That is a result of brain-washing of the ignorant by those who benefit from this ridiculous misinformation.

dmarks said...

El Grillo: Why should union membership be part of the deal? As opposes to, lets say, a requirement that workers be Baptists or subscribe to "Maxim" ?