General Motors

[Embar Angylwrath]

The UAW killed the deal. Part of teh deal was that they take pay cuts to bring wages in line with non-union auto makers. The UAW refused, and the support for the bill vanished.

http://apnews.myway.com/article/20081212/D95106M80.html

As a response, GM retained BK counsel, they know what's coming. And if GM goes BK, the judge will toss the UAW contract, and anyone who wants to work for GM will work for parity wages and benefits. The UAW won't have a say in it.

This is the right move by Congress. Let GM fail. It SHOULD fail. It DESERVES to fail.

Now, lets see if Partha is correct about the 3 million job loss, or just he's just his normal raving loon self. (Bet on the latter)

[Partha]

EPI report gives estimates from 900,000 to 3.3 million.

http://www.epi.org/content.cfm/bp227

Three scenarios were developed for this study. Each assumes that bankruptcy results in a complete shutdown of one or more U.S. vehicle producers.
The first scenario assumes that General Motors alone fails, but that the rest of the domestic industry is able to stay in operation. The second scenario assumes that all three U.S.- based auto companies go out of business, but that the domestic operations of foreign-owned auto companies are able to keep running. The third scenario assumes that the entire U.S. light vehicle assembly industry, including foreign-owned assembly operations (so-called transplants), shuts down.

Long story short: If Dd is right and the loss can be contained to just GM with no dropoff from other manufacturers, 900,000.

If I'm right and the Big 3 fall, depending on how much damage is done to foreign car manufacturers due to parts suppliers closing, anywhere from 2.1 million to 3.3 million.

I'll also note this passage.

Some public officials and commentators have proposed that domestic automakers should be allowed or encouraged to enter bankruptcy, suggesting that the industry should go through a restructuring process, similar to those experienced by many airlines and other companies (Romney 2008). However, bankruptcy is not an option for domestic automakers. Most customers have indicated in surveys* that they would be unwilling to purchase a vehicle from a company that was bankrupt, because they might not be able to obtain a warranty or repairs. Hence, a bankruptcy reorganization, by whatever name, is a one-way ticket to a long-run domestic auto-industry collapse.
Any effort to restructure domestic automakers, either through a normal Chapter 11 bankruptcy or a “pre-packaged” bankruptcy with government support, is likely to end in the failure of one or more auto companies and a liquidation of company assets through a Chapter 7 proceeding (Cohn 2008). The consequences would be devastating for the entire U.S. motor vehicle industry and for the economy as a whole. The Center for Automotive Research has suggested that the bankruptcy of one or more of the Detroit-based automakers would lead to widespread bankruptcies throughout the thousands of firms that supply parts to domestic and foreign auto producers. As a result, most or all assembly of cars and light trucks by domestic and foreign automakers in the United States could grind to a halt in relatively short order.

In other words, what I've been telling you. Guess you can go tell them they're raving loons, too.

[Partha]

Ah, the mighty one speaketh.

Fact is, whether you allow a bankruptcy or not that restructuring has to happen if you expect US auto manufacturing to survive another decade. The UAW will bitch and moan but they're a walking political corpse that will have to come to the cold realization that they're in a global market and they can't price their own members out of a job.

Hi, did you happen to miss the part of the bill that specified that if restructuring didn't happen that the overseer could kill the loans and demand repayment?

Actually, most economists are on my side as far as I've seen, where my side is that letting GM go into controlled bankruptcy would NOT result in 3 million job losses more than not doing it.

Link? Quote? Names? Thought not, considering this is the fourth time I've mentioned it and you have yet to name one or link one.

Oh noes - you lose an argument and cry unfair. Get over yourself.

Oh noes, you use double standards and then bitch that I call you on them.

I stipulated the government would ensure the others don't fail.

If you can stipulate that the government can ensure and would ensure that the others don't fail, and you claim that all 3 are equally tied down by TEH UNCOMPETITIVE UNIONS, then what's the case for letting even one fail? Simply because you must have blood?

Bullshit. You clearly stated that GM going bankrupt would cost three million jobs.

As has been pointed out by me before, I stated the 3 million jobs number in response to EMBAR claiming that CHRYSLER would fold. Go back, reread. I'll wait right here. Really.

The government has no money to enact a restructuring? Since when?

Now you're saying the government should either just socialize the plants or just give Ford and Chrysler the money to buy GM in your scenario. That makes no sense. After all, if they can socialize the plants, why don't they just do it before Chrysler goes under? If they're going to finance the buyout, why should they give that money to companies that you claim are uncompetitive and doomed to fail?

No it isn't. Stop putting words into my mouth. The UAW must recognize they are not in a monopoly position on labor and act accordingly. You know - face reality?

They gave back in 2007. They offered givebacks prior to the second loan lobby. Now you want more. What other purpose could there be to demanding greater givebacks than breaking the union, considering your solution is to remove all benefits and all extra wages and reduce them to non-union levels?

[Partha]

The UAW killed the deal. Part of teh deal was that they take pay cuts to bring wages in line with non-union auto makers. The UAW refused, and the support for the bill vanished.

http://apnews.myway.com/article/20081212/D95106M80.html

As a response, GM retained BK counsel, they know what's coming. And if GM goes BK, the judge will toss the UAW contract, and anyone who wants to work for GM will work for parity wages and benefits. The UAW won't have a say in it.

This is the right move by Congress. Let GM fail. It SHOULD fail. It DESERVES to fail.

Now, lets see if Partha is correct about the 3 million job loss, or just he's just his normal raving loon self. (Bet on the latter)

Um, they retained BK counsel well before this, Embar, and you managed to miss parts of your article to bash the unions.

Hourly wages for UAW workers at GM factories are about equal to those paid by Toyota Motor Corp. (TM) at its older U.S. factories, according to the companies. GM says the average UAW laborer makes $29.78 per hour, while Toyota says it pays about $30 per hour. But the unionized factories have far higher benefit costs.

[Embar Angylwrath]

I think the wage-benefit total is a given understanding when we say "wages". If not, let me clarify... total employee cost has to come down in the Big 3.. the UAW balked. The UAW gets what's coming to them. Which is, if you are correct about the armageddon of 3 million lay-offs... no jobs.

Should the union have capitulated to the demands they take a parity package? Answer me that, Partha.

[Partha]

Embar, the unions have already signed on to take over the past retiree health plan. What else specifically do you want them to give up? I mean, besides having anything that they won as a union.

Oh, wait, forgot. Your goal IS to get rid of the union. Nevermind....

[Embar Angylwrath]

Embar, the unions have already signed on to take over the past retiree health plan. What else specifically do you want them to give up? I mean, besides having anything that they won as a union.

Oh, wait, forgot. Your goal IS to get rid of the union. Nevermind....

You avoided the question. Can you answer it please?

[Partha]

Wages are already equal - see link above. Retiree health care costs come off the board in 2010. It's helpful to know what exactly you mean by 'parity package' before I answer the question - so spit it out.

[Ddrak]

Long story short: If Dd is right and the loss can be contained to just GM with no dropoff from other manufacturers, 900,000.

If I'm right and the Big 3 fall, depending on how much damage is done to foreign car manufacturers due to parts suppliers closing, anywhere from 2.1 million to 3.3 million.

That sounds somewhere closer to the mark. Note that these numbers are in comparison to the status quo at the moment, not comparing to what is coming down the track anyway so I'd say that the real effect of GM going under compared to what's gonna happen if the government bails it out is somewhat less than 400k jobs. That's a pure guess with no backing, but estimates I've seen show the US auto industry is going to take a bullet to the head whichever way things go.

Here's the crux of the matter - all of Partha's numbers have really been hinging on the research coming from the Center for Automotive Research (lots of economic press are quoting that figure), but those numbers have also been criticized as being exaggerated.

The argument goes that if you allow GM to enter Ch11 then people won't buy from them for fear that they won't get parts. This is correct. The scenario that wasn't explored by the CAR was what happens if you package up GM into the other two manufacturers. They're just looking at what happens if one or more companies close their doors and simply stop. That scenario simply isn't realistic and is essentially a strawman paid for by the Big 3 (via CAR) to help them beg for money.

The funny thing about Partha's argument is while he keeps begging me to link stuff, I can happily just use his links to show that his predictions are not what he thinks they are. I'm not going to bother scouring the web when he can't even give support to the 3 million number. If he wants to demand links the earth isn't flat, I'm not going to bother with that either.

What is amusing is the continued use of strawmen:

you claim that all 3 are equally tied down by TEH UNCOMPETITIVE UNIONS

I never made this claim - Ford and Chrysler are less tied down (and I said this earlier).
Similarly, note the scoffing at "uncompetitive unions" when it's a plain fact that GM and to a lesser extent, Ford and Chrysler, are definitely not able to compete because of the past union deals that have been made. Misspelling "the" doesn't make something right.

I stated the 3 million jobs number in response to EMBAR claiming that CHRYSLER would fold.

He didn't claim that at all. Stop making shit up.

Now you're saying the government should either just socialize the plants or just give Ford and Chrysler the money to buy GM in your scenario. That makes no sense.

It makes good sense (giving them money/loans, not socializing), especially given the government could use it as a tool to begin shearing off the retiree overheads and job bank stupidity as a starting point to make US makers competitive again. Just like they let some banks fold, assisted buyouts of others and backed up some others, they should pick and choose in the auto industry as well.

They gave back in 2007. They offered givebacks prior to the second loan lobby. Now you want more. What other purpose could there be to demanding greater givebacks than breaking the union

Other purpose? Umm... making the US makers competitive again without throwing up protectionist barriers? Ensuring the future of US auto manufacturing beyond a bailout every few years? Making the companies something better than a sink on the taxpayers? Get over your "zomg union busting" bullshit. I don't give a shit whether the unions live or die - they're nothing more than an employment source for companies as far as I'm concerned. What I'm trying to think of is how to get some semblance of function back into the US auto industry so the unions actually have jobs for their members to fill.

Dd

[Ddrak]

Oh yeah, I almost forgot...

Oh noes, you use double standards and then bitch that I call you on them.

The amusing thing about this part is Partha's showing his ignorance on the "3 million in one year" model that he's happily quoting as canon. The "double standard" I'm supposed to have employed is that I'm only looking at the first year when there's supposedly more layoffs coming after that time. What's amusing is that looking at the actual source for the "3 million" number, it shows a significant bounce back after 1 year in all scenarios, so I was actually giving Partha the benefit of doubt in my comparisons, not short-changing him. I'll repeat and summarize that a little more precisely because it's worth noting:

The "3 million" number Partha is using is the total number of jobs lost after one year, prior to the bounceback of over a million jobs, compared to the September 2008 employment figures and NOT compared to the figures resulting from any alternative actions. In short, the real number in the long term is under 2 million (still a lot) and most of those will be lost ANYWAY even if the Big 3 are bailed out. The only thing "3 million" happens to be is the biggest number on the report, and it's not actually meaningful in a comparison of options.

End result - Partha doesn't actually know what he's talking about, complains about things when I've even left them his his favor as "double standards", links articles that destroy his own position while supporting mine and floats from stance to stance attempting to play stupid games of "gotcha" by attacking strawmen I've never actually proposed. It's just poor form all around.

Dd

[Embar Angylwrath]

Wages are already equal - see link above. Retiree health care costs come off the board in 2010. It's helpful to know what exactly you mean by 'parity package' before I answer the question - so spit it out.

By parity, I mean the total cost of wages and benefits per employee, per hour, are equal between employees among employees in Big 3 and non- Big 3 companies.

[Partha]

The amusing thing about this part is Partha's showing his ignorance on the "3 million in one year" model that he's happily quoting as canon.

Can someone, anyone, point out to Dd that I never said one year? Pretty please? His strawman is almost out of stuffing. I'd also point out that my '3 million in one year' figure is based on a scenario that they seem to find likely, but he's not reading what I write. Maybe you can.

I'm supposed to have employed is that I'm only looking at the first year when there's supposedly more layoffs coming after that time. What's amusing is that looking at the actual source for the "3 million" number, it shows a significant bounce back after 1 year in all scenarios, so I was actually giving Partha the benefit of doubt in my comparisons, not short-changing him. I'll repeat and summarize that a little more precisely because it's worth noting:

Um, I'm missing the part where those workers get jobs back of similar pay and benefits. You might consider it a bounceback if they end up greeting at Wal-Mart in place of skilled labor, but I don't see it as a plus and the study doesn't say they get back good jobs.

The "3 million" number Partha is using is the total number of jobs lost after one year, prior to the bounceback of over a million jobs, compared to the September 2008 employment figures and NOT compared to the figures resulting from any alternative actions. In short, the real number in the long term is under 2 million (still a lot) and most of those will be lost ANYWAY even if the Big 3 are bailed out. The only thing "3 million" happens to be is the biggest number on the report, and it's not actually meaningful in a comparison of options.

Oh, wait. You mean when they say 'In scenario A, 3 million jobs will be lost in the first year' isn't a real statement? Or is it not meaningful merely because you're fixated on the scenario where ONLY 2 million are lost?

I will note this, however:

links articles that destroy his own position while supporting mine

See, because quoting an article that shows that a worst case scenario will do just what I said is destroying my position.

Of course, I had to link it, simply because Ddrak is too damn lazy to actually, like, show his work. Consider me outsourced employment.

[Partha]

Wages are already equal - see link above. Retiree health care costs come off the board in 2010. It's helpful to know what exactly you mean by 'parity package' before I answer the question - so spit it out.

By parity, I mean the total cost of wages and benefits per employee, per hour, are equal between employees among employees in Big 3 and non- Big 3 companies.

No. If the union cannot gain for it's employees better conditions than a non-union employer, then they are effectively destroyed. Like I said, that's the goal, one way or another. The death of American manufacturing is not worth your attempt to destroy the UAW.

[Embar Angylwrath]

What a sad, sad fool you are. The union is helping to ensure the working conditions of its members include lay-offs and unemployment. GO UNIONS!

Bankruptcy will force the the UAW to take whatever it is the bankruptcy judge gives them, which I guarantee you will be no more than parity packages, and thats even if the judge doesn't open up the shop to non-union auto workers (and it's my bet he will, since its his job to look out after the primary entity, not the interests of the UAW).

By not agreeing to reductions, the UAW shot itself in its head. Seems they'd rather have 100% of nothing, than 70% of something, and live to fight another day. Not too smart.

[Ddrak]

Can someone, anyone, point out to Dd that I never said one year? Pretty please? His strawman is almost out of stuffing. I'd also point out that my '3 million in one year' figure is based on a scenario that they seem to find likely, but he's not reading what I write. Maybe you can.

If you didn't say "one year" then you're making up the "3 million" number because NOTHING says there'll be 3 million lost in any scenario beyond the one year mark. All of them show a bounceback in the auto industry after that point, even the one with the Big 3 completely closing down. Seriously, read the source.

Claiming "one year" is a strawman means you've made that number up or perhaps not understood what the number was actually referring to. I apologize for assuming you knew what you were talking about if that's the case.

Um, I'm missing the part where those workers get jobs back of similar pay and benefits. You might consider it a bounceback if they end up greeting at Wal-Mart in place of skilled labor, but I don't see it as a plus and the study doesn't say they get back good jobs.

If you're missing the part where the auto industry comes back then you didn't read the source paper. The bounceback is in the same jobs they left. I would expect the jobs to pay the same as the non-union shops, which totals around $45/hr. Again, you're making shit up about the Wal-Mart thing - go read the research paper you're trying to base your argument on.

Oh, wait. You mean when they say 'In scenario A, 3 million jobs will be lost in the first year' isn't a real statement? Or is it not meaningful merely because you're fixated on the scenario where ONLY 2 million are lost?

They say "3 million in the first year", then go on to say that 1.2-1.3 million of those jobs will come back after the first year. That's the scenario if all three shut down. That's also comparing to Sep '08 figures, not comparing it to what's going to happen anyway.

Look - here's the two scenarios:

A) Big 3 shut down. Compared to Sep '08, 3 million jobs go which recovers to 1.8 million lost by three years.
B) Big 3 reduce by 50% (which is probably the best case right now). Compared to Sep '08, 2.5 million jobs go which recovers to 1 million after three years.

So, the effect of the Big 3 shutting down completely (the worst case if you let GM go bankrupt) is an extra 500k jobs lost in the first year which grows to 800k after three years. If the government throws money at Ford/Chrysler then the losses will be far less than that. Your "3 million" number is not what you think it is.

Of course, I had to link it, simply because Ddrak is too damn lazy to actually, like, show his work. Consider me outsourced employment.

Because when I do, you don't even read it. See - I linked the source research paper for your "3 million" number and your responses show you clearly didn't even skim it let alone read it. Like I said, you're not interested in debate - just in playing stupid "gotcha" games while not holding down a solid position.

Dd

[Embar Angylwrath]

I'd also like to point out that Partha's argument for the salvaging of the Big 3 (Lurker has gone curiously silent, I wonder why...) includes a government subsidy for a privately held company (Chrysler, owned by Cerebus, which is an investment holding company for the *very* rich).

I'd like Partha (and Lurker, if he would grace us with his/her presence again), to explain why they feel taxpayer dollars should go to bailing out a private equity firm.

[Kulaf]

Ya'll are still missing a key comparrison.....total number of workers employed per plant between US and foreign owned plants. Making wages equal is just one component.

Not sure if Toyota, Honda et al post their employment figures for domestic US plants or not.....but it would be an interesting comparrison.

[Ddrak]

According to one report I saw, to go from the $55/hr figure for UAW plants to $45/hr for non-UAW plants would cost about $800/vehicle for the Big 3. That's only for the actual plants themselves and not factoring in any union/non-union differences with suppliers. That still didn't discuss whether the non-union plants had lower staff numbers though.

To remain viable, a union either needs to give value for money to an employer or it needs to have a complete monopoly on all employment across an industry. Without one of those, an employer hiring union workers is at a competitive disadvantage to a different one hiring non-union workers which results in the union shops going out of business and the end of the union. If a union doesn't come to terms with this then it deserves to die and I really don't feel too sorry for the workers that didn't research their options.

Dd

[Lurker]

I'd also like to point out that Partha's argument for the salvaging of the Big 3 (Lurker has gone curiously silent, I wonder why...) includes a government subsidy for a privately held company
...
I'd like Partha (and Lurker, if he would grace us with his/her presence again), to explain why they feel taxpayer dollars should go to bailing out a private equity firm.

I think i'm on record as saying that a blank check is out of the question, that the UAW needs to make concessions (which they have... the latest attempt by the Republicans to force a complete scapegoating and capitulation aside), and that there should be a government backed reorganization of the troubled companies.

The foreign auto companies have a much bigger advantage than non-union workers. They are heavily subsidized and protected by their governments.

[Partha]

If you didn't say "one year" then you're making up the "3 million" number because NOTHING says there'll be 3 million lost in any scenario beyond the one year mark.

See, this is why you can't argue with a wingnut - and on the point of unions, Dd sounds exactly like Corker and Shelby with John Howard's accent.

Both studies say there's a distinct possiblilty that 3 million jobs will be lost. Without looking at the source data, Dd claimed I was a 'liar' and that I 'pulled the figure out of my ass'. But then, when he looks at the reports and they say just that, now he wants to argue that I said 'one year', and that if I didn't say 'one year', then I was lying about the 3 million that he admits is in the report. Forget the fact that none of us were talking 3 years out at any point, this is now the new standard, because he can't win his original argument without it. Oh yes, and don't forget the part where anything he says, no matter what it is, in incontrovertible and completely true, without any need for supporting data or even coherence. You know, like the part where the government who refuses to loan money to keep a company alive will instead loan that money to two other companies whose lifespan is (according to the Republican argument) not good either to buy that third company's remains.

It's no wonder Lurker's stayed silent - he knows you can't argue with a union-buster with his mind made up.