Update on the Auto Industry

It is Sunday afternoon (6/7/09) and no response from the Supreme Court yet. Why is it important for the Chrysler so called agreement to be reviewed? Because I spent most of my career forecasting the Montana economy, it amazes me that anyone would put the union needs above the needs of a nation. The Miners union killed the Anaconda Company in the 1980’s. There were no negotiations from the union just dictates of what the company had to do to get its workers back into the mines. The union went so far as to tell the workers that the strike had to continue to “make an example of the company” so other negotiations would be easier. After a long strike the company closed the mines and all 2,200 workers were terminated.
About 10 years later the mines were purchased by Dennis Washington of Washington Construction. It took almost another year to have a non-union organization that would be profitable and accepted by the Butte, Montana workers. The deal was the miners would make an average of $28,000.00 base pay and share 50/50 with the owner on any profits over 10%. Bonuses were paid out at the Christmas party each year. After 5 years of operation the union tried to resign the miners to a contract. The 375 miners rejected the proposal at an overwhelming percentage. Notice the employee count. The amount of ore produced did not change.
Now to the auto maker’s plight. Because of work rules, what the workers are paid is secondary. Both mining and auto makers have seen unbelievable productivity changes in production. In both cases the unions have worked tirelessly to maintain employment. Tactics has been similar too – either you sign or we will make an example of you. So it is not so hard to believe the UAW has not negotiated through any of this process. Getting more in the proposed settlement then the secure bond holders is evidence of mafia type tactics instead of true negotiations. So now it is up to the Supreme Court to step in and force the bankruptcy court to do its job. Commerce is a Constitutional issue that is being turned upside down by Obama and the UAW.