Crazy Idea for the Union Mess

Now sure how this would be received, but I thought I would post it anyway. Currently our biggest problem is that our automakers sell less cars than they did years ago. This will never change because we are an open economy, and as long as any company can come in here, and start anew, American automakers will continue to suffer lower sales as the pie gets cut into more pieces.

The idea I had was that maybe it is time to have a corporation/fund set up that will manage the retirment accounts of all US automotive workers (no matter who they worked for- GM, Toyota, etc). It would have to be legislated into existance, but could generally operate freely as it's own entity. Participation would be mandatory if you want to sell cars in the US. The fund and it's investments would be managed by a board of directors who would be responsible for determining benifits, pay out levels, and investments. I say that there should be a 50/50 split between the retirees/unions and the manufacturers in terms of board seats. Also, the distribution of seats on each side would be determined proportionatly by how many retirees each manufacturer has in the system. So initially American automakers, and unions would have equal, and controlling representation in the company. As foriengn automakers put more workers in the pull, they would get more say over everything.

Each company upon entering the system would have to put their entire retirement portfolios into this company when it is set up. Going forward, every manufacturer would have to pay a per vehicle fee (say 2% the MSRP of each vehicle sold) into the fund. This fee would be the same for all manufacturers, regardless of how long you have been in the US, and how many retires you have. This fee would be set by the fund's board of directors, and reviewed by some kind of government oversight (to make sure everything is done right). Is see this as a way for every american auto retiree to know for sure that he will have a reasonable pension check for the rest of their lives. Plus imagine the economies of scale this fund would have with insurance companies. I am certain they would have enough leverage to drive down the current cost of insurance.

My opinion is that area's such as Michigan are suffereing through some pretty terrible times now....and sadly most of the country does not care or know. This is an area that was once home to one of America's greatest industries...and now it is in decay. We can say that GM will magically make great cars that can pay for all this...but that is simply impossible. With more players than ever, the pie just keeps getting cut into smaller peices, and it becomes very hard to grow unless you are a new player. GM could make the best, most profitable cars in the world, and at best keep their market share even...they will never have signifigant growth again under the current system.

I am all for a free market...but I also feel that foriegn companies that displace American production capacity have a obligation to pay for the legacy cost that displaced capacity created. It will also unburden GM, Ford, and DCX from liabilities that there is now way they can meet given their current size. That money can be put towards better, more fuel efficiance vehicles, and more competition in the industry.


Just an idea I thought I would post...I am pretty certain it could never happen. I do think the general idea would be a a great way to keep a free market, and put domestic automakers on equal footing with import automakers.

interesting idea. Next step is to try to find somebody in a high ranking position that will listen...

As long as it doesn't put the Big 2.5's exisiting legacy costs on everyone else's shoulders, the logic is pretty sound.

On the other hand, it sounds like a big bureaucratic mess.

While they are at it they should make a rider that lets me opt out of Social Security.

As long as it doesn't put the Big 2.5's exisiting legacy costs on everyone else's shoulders, the logic is pretty sound.

On the other hand, it sounds like a big bureaucratic mess.

Basically what it does is lets the big 2.5 off from paying retirement benifits that were gaurenteed during a time when they sold many more cars. Instead, it shifts some of the responsibility for paying those retirees to the forign companies who have came in and taken a peice of the big 2.5's pie. To accept this idea...you have to accept the idea that GM will never really gain a huge chunk of market share again...and at best will sustain.

While that may be tough to admit...it is realistic given increasing competition.

Basically what it does is lets the big 2.5 off from paying retirement benifits that were gaurenteed during a time when they sold many more cars. Instead, it shifts some of the responsibility for paying those retirees to the forign companies who have came in and taken a peice of the big 2.5's pie. To accept this idea...you have to accept the idea that GM will never really gain a huge chunk of market share again...and at best will sustain.

While that may be tough to admit...it is realistic given increasing competition.

Why should a foriegn company be responsible to another compamies retiries? That sounds alot like closing a free market and instituting socialism.

While they are at it they should make a rider that lets me opt out of Social Security.

I agree. The amount every check that I pay to Social Security makes me sick when I think about how much I'd have if I could invest that myself... ugh...

Basically what it does is lets the big 2.5 off from paying retirement benifits that were gaurenteed during a time when they sold many more cars. Instead, it shifts some of the responsibility for paying those retirees to the forign companies who have came in and taken a peice of the big 2.5's pie. To accept this idea...you have to accept the idea that GM will never really gain a huge chunk of market share again...and at best will sustain.

While that may be tough to admit...it is realistic given increasing competition.

This will free up a lot for the big 3. This will also help American workers for non-American brands. What kind of healthcare and retirement benefits do they have compared to domestic employees today?

A set percentage on every new vehicle sold in the US going toward the benefits of American auto workers.

This might disuade Toyota from wanting to be #1 in US sales. But it is a market that they financially cannot stay out of.

This is one idea that benefits American as a whole.

This is one idea that benefits American as a whole.

No, it's an idea that benefits UAW members as a whole. How does this idea in any way benefit the average american walking into a toyonda dealership who now has to pay more for their car to support legacy costs of a company they don't care about?

How many other displaced and disenfranchised workers should we have to bail out? In case you missed it, the auto industry is far from the only area in this country that's a big loser to offshore competition.

With that in mind, all you're really describing is increasing tariffs on foreign companies, or really, just increasing taxes in general in the name of boosting welfare, social security, medicare, etc.

Increasing taxes on people who have money to give money to people who don't is not necessarily a panacea, and can in fact have the opposite desired effect and stifle growth, reducing revenue, and thus the very tax money you wanted tro redistribute in the first place.

They should be responsible because of us allowing them in our market has made it so that our automakers are selling less cars, and making less profit do to increased competition. It is impossible for the current much smaller GM to pay for legacy costs when it was much larger. One reason Toyota has been able to lay the smack down on US automakers is that it has basically no legacy costs in the US. GM on the other hand has the legacy costs of a company with 50% of the market, but actual today sales that are half that. GM can right size to compete today, but they have no control over their past work force, and the commitments that were made then. We can say cut back beneifits.

Foriegn automakers have been able to compete here with the unfair advantage of no legacy costs for years. This simply level's the playing field and says "If your gonna take some of the US Automakers sales pie...you also gonna take some of that peices legacy costs with it to".

One thing we need to keep in mind is that there are millions of American's out there who have had their retirement benifits cut...or the threat of it because US automakers can keep paying for them. They get their benifits cut, there goes there way of life, and the local economy.

Why should a foriegn company be responsible to another compamies retiries? That sounds alot like closing a free market and instituting socialism.

Brilliant mr formula. And while we're at it, lets' just have every new successful company pay for the mistakes of those they displace.Why don't we just suck all motivation for any company to succeed right out the window. In fact, why stop there? Let's just have everybody who works take care of those who don't.

I think you should look in the mirror first. How about an internet tax mr. website founder. I think you should have to pay for the legacy costs of all the failed websites that have come before you.

yes it woudl help, but it's not practical, and not going to happen.

the only way to "fix" it would be to lump all the union funds together then get the forgien companies to let unions into thier plants.

Yes. It is a tarriff. Until foreign companies play fair, all of their goods (whether or not made here) should be subject to a tarriff. What would be better is to just kick their a$$es out of the country.

And I believe this plan would benefit ALL autoworkers. Not just ones from the big 2.5. All the foreign car workers would benefit from this plan, as well.

I think it's a great idea. If that makes me a socialist, then so be it. I happen to believe that we should help our fellow countrymen out. We'd certainly want some help if we fell on bad times.

Basically what it does is lets the big 2.5 off from paying retirement benifits that were gaurenteed during a time when they sold many more cars. Instead, it shifts some of the responsibility for paying those retirees to the forign companies who have came in and taken a peice of the big 2.5's pie. To accept this idea...you have to accept the idea that GM will never really gain a huge chunk of market share again...and at best will sustain.

While that may be tough to admit...it is realistic given increasing competition.


It's a brilliant idea, IMO.

If implemented, it would be a shame you'll get zero reward for the idea and the relevant board members will get millions in their pay packets for implementing the strategy.

The imports shouldn't have to pay a cent to help the big 2.5 get out from under the Unions. This isn't their mistake, and they shouldn't pay for it. Maybe the big 2.5 can get a better deal from the UAW this September (?)...

Here's a "Crazy Idea for the Union Mess"

Have the workers vote to become Non-Unionized.

;)

Un-freakin'-believable how one sided this board is at times.

The old 'it dem durn furriners' fault' simpleton mentality. If the big who-ever's-left is interested in protecting it's workers legacy costs and/or lowering operational costs, why don't they twist of arms of past CEO's, managers, etc, who's laziness/stubbornness/lack of vision/lack of acceptance of a changing market (jeez I could on forever) bad decisions got them into this mess to redo their retirement package?

As long as it doesn't put the Big 2.5's exisiting legacy costs on everyone else's shoulders, the logic is pretty sound.


Basically what it does is lets the big 2.5 off from paying retirement benifits that were gaurenteed during a time when they sold many more cars. Instead, it shifts some of the responsibility for paying those retirees to the forign companies who have came in and taken a peice of the big 2.5's pie. To accept this idea...you have to accept the idea that GM will never really gain a huge chunk of market share again...and at best will sustain.

While that may be tough to admit...it is realistic given increasing competition.

Ok, in that case I disagree with you.

I defintely believe that we've bent over backwards in our effort to let foreign competition dominate our own industry, however, it's not the foreign competition's fault that the big 2.5 made a bunch of stupid promises.

Asking the imports to throw money at the Domestics' past business decisions is unacceptable.

Each automaker should deal with its own legacy costs.

If all manufacturers building/selling cars in the US were forced to work with the UAW and forced to contribute an amount proportionate to the amount of workers they currenty employ to a benifits fund, that might make a little more sense.

Sounds awfully socialist though.

See though...GM did not make mistakes. They gave decent deals to their employees so that people could live the american dream. Those people worked their whole life, and retired thinking that promise would be there. Now it is not so sure because we have allowed foriegn car makers with no obligations to the country, or it's citzens well come in, and compete on equal footing with a major national industry.

Your analogy is all scewed up. Put yourself in GM's place. What if you owned 50% of the automarket, and thought you were doing right by all your workers, and giving them a decent pay and retirement. You are cruising along, all fine and happy, untill the competition starts to heat up. Now all the sudden you have companies with cheap foreign labor, and no obligations selling cars cheaper than you. Since they have less overhead, they can put more into R&D, and their cars get better quicker than yours. American's embrace these cheaper, and gradually better cars because American is becoming less nationalistic. As GM, you want to compete...but you have an obligation to the large chunk of American workers who earn their living working for you...and want to live a nice American way of life. As you sell less cars, you lay off more workers. Your pension and healtcare costs soar. Now you have even less money to make better cars. It's a never ending spiral, and if someone does not do something, we will just see at least one of the big three go away.

The fact of the matter is...something like that above would never happen in a country like Japan. Most Japanese would never consider an American car to begin with...and the Japanese government is much more protective of it's industry.




Brilliant mr formula. And while we're at it, lets' just have every new successful company pay for the mistakes of those they displace.Why don't we just suck all motivation for any company to succeed right out the window. In fact, why stop there? Let's just have everybody who works take care of those who don't.

I think you should look in the mirror first. How about an internet tax mr. website founder. I think you should have to pay for the legacy costs of all the failed websites that have come before you.

Ok, in that case I disagree with you.

I defintely believe that we've bent over backwards in our effort to let foreign competition dominate our own industry, however, it's not the foreign competition's fault that the big 2.5 made a bunch of stupid promises.

I don't think they were stupid...I don't think anyone in the auto industry though GM would go from 50% marketshare to 25% marketshare in 20 years.

Asking the imports to throw money at the Domestics' past business decisions is unacceptable.

They were not "business decisions".....they were the right thing...and what would have been expected of any huge American company 20+ years ago.

Each automaker should deal with its own legacy costs.

There is not a simple way to deal with legacy costs. If you have 500,000 workers, paying the retirement benifits of a million retireees there is an imbalance that CANNOT be fixed with out major changes. You can pay retirees less...but that just depresses the the economy. The only way an automaker on it's own can fix the problem is to say screw it and go bankrupt. I lived in Baltimore...and know what happens when that occurs (Bethlaham Steel). What we are seeing now is a preview of Social Security in 20 years.

If all manufacturers building/selling cars in the US were forced to work with the UAW and forced to contribute an amount proportionate to the amount of workers they currenty employ to a benifits fund, that might make a little more sense.

Sounds awfully socialist though.

I don't think my plan is socialist. Matter of fact, i am willing to bet that if you check out the trade policies of the countries these cars are coming from...you will find the definition of nationalist.

See though...GM did not make mistakes.
I guess this would be true if you don't consider lack of planning, poor product, and a poor service experience mistakes. First, to assume you'll always be on top is a stupid thing to think.

They gave decent deals to their employees so that people could live the american dream. Those people worked their whole life, and retired thinking that promise would be there.

It isn't a company's duty to give the American dream to anyone. It is their duty to pay you the market wage for your time. The big 2.5 have obviously overpaid their workers and commited to too much future debt. Notice how other companies are making cars here, and aren't in the same boat.

Now it is not so sure because we have allowed foriegn car makers with no obligations to the country, or it's citzens well come in, and compete on equal footing with a major national industry.

Where was the big 2.5's obligation to the consumer to make a good product? Where was their obligation to us to give us good service when buying or servicing our cars? If the domestic automakers were making products that people wanted and standing behind their products, they wouldn't have lost their market share.

Plus any company that simply assumes that they can give hand outs because they are on top today and doesn't have the vision that the market could shift deserves to be in the big 2.5's situation. I don't owe the big 2.5 or their workers anything other than paying into an unemployment fund.

Simply put, if they have a better product I will buy it. Brand loyalty left the building in 1980. Too bad they didn't realize this until 2000.

It's not so much as acknowledging that the foreigners are not at fault for Detroit's woes, it's about competing in the same market on equal terms.

The analogy is of refereeing a football game: You can't have one set of rules for one team and another set for the other team. The arena is today, not last year, last decade or last century. You don't continue to penalize a team based on past performances... otherwise the crowd would lose interest.

I think there are some misunderstandings...so please read this...

One thing I think people are missing is that the fund would initially funded by all the assests of the big 3's pension funds up front. As far as I know...none of the funds (except maybe Ford), are underfunded...so with proper investing management by the fund, the big three would still essentially pay for their chunk. We are talking $10's of billion's Detroit automakers would be putting in upfront. However going forward...any funding would be paid for by the fee...and distributed based on who is selling the most cars at the time. The reasoning is that the companies who are selling the most now need to be paying the most now (when those profits are realized) because more success now=more employees, and retirees later. I am not sure how this could be seen unfair or as a tax. As the big three's retiree's move on to better places, and Toyota, or whatnot gains more retirees in the system, they would gain more control.

It would actually give foriegn companies a reason to build more factories here because then they could throw more employees under the fund, and gradually gain some control on the board. If you were a foreign company, what would you rather do? Pay a fee that goes to someone else's workers...or move production capacity to the US, and have them paid for by this fund to?

Sounds like a decent way to fix the regressive pension issue that currently exists.

Notice how other companies are making cars here, and aren't in the same boat.

If GM could set up new factories with non union workers, they would be better off too.

I don't think they were stupid...I don't think anyone in the auto industry thought GM would go from 50% marketshare to 25% marketshare in 20 years.

They were not "business decisions".....they were the right thing...and what would have been expected of any huge American company 20+ years ago.



They were STUPID if they thought that they will always have the biggest marketshare. Its their decisions that put them where they are now.

Saying they "did the right thing" is a relative term. Whether they did the right thing or not, they DID it, and they are the ones who should prosper or suffer because of it. They dug themselves a hole they cant get out of. Now you want to require their competition to lend a hand? Or maybe u want the competition to dig themselves a hole too?

No business ever plans to have half the marketshare. Did you even read my plan? This is not asking for a hand...the American makers will be funding the fund up front. The imports would be paying on a "going forward" basis.

They were STUPID if they thought that they will always have the biggest marketshare. Its their decisions that put them where they are now.

Saying they "did the right thing" is a relative term. Whether they did the right thing or not, they DID it, and they are the ones who should prosper or suffer because of it. They dug themselves a hole they cant get out of. Now you want to require their competition to lend a hand? Or maybe u want the competition to dig themselves a hole too?

The difference between locally based foreign makers and domestics is that there's always the option for foreign makers to pull out of NA altogether if the pension burden (over time) becomes too costly! What option do the Big 3 currently have, short of declaring bankruptcy?

No matter how hard I try to view it from both sides, I can't side with those who lay blame squarely at the feet of the Big 3 for their ineptitude in dealing with the unions of the past. GM's Ron Zarella and Roger Smith are long gone. It's pointless looking back at the mess they created... to say GM deserve to be where they are today. But the mess is not exclusive to just GM, it's the whole American car industry!!!

Imagine this hypothetical: If Toyota, Honda and Nissan were ever in similar financial trouble, would people here reason it would be due to 'irrelevant product' or more a function of the 'environment' they compete in? If this scenario is not plausible to many, remember, it was also inconceivable that GM would be relinquishing its global sales crown.

I like Branden's idea as it helps to even out the playing field. If there are flaws in its makeup then I'm sure they'll be sorted out over time.

I agree. The amount every check that I pay to Social Security makes me sick when I think about how much I'd have if I could invest that myself... ugh...

What you don't see is that your employer has to match what you pay.

So together that is something like 15% of your salary.

If GM could set up new factories with non union workers, they would be better off too.

Here's a "Crazy Idea for the Union Mess"

Have the workers vote to become Non-Unionized.

;)

.

:p

There is not a simple way to deal with legacy costs. If you have 500,000 workers, paying the retirement benifits of a million retireees there is an imbalance that CANNOT be fixed with out major changes.

I'm going to have a few thousand dollars of student loan debt.

What you seem to be suggesting is that other people in my field who happened to have had better financial situations should be obligated to help me pay my debt.

It would sure be nice, but it just doesn't work that way.

I'm going to have a few thousand dollars of student loan debt.

What you seem to be suggesting is that other people in my field who happened to have had better financial situations should be obligated to help me pay my debt.

It would sure be nice, but it just doesn't work that way.


I think there are some misunderstandings...so please read this...

One thing I think people are missing is that the fund would initially funded by all the assests of the big 3's pension funds up front. As far as I know...none of the funds (except maybe Ford), are underfunded...so with proper investing management by the fund, the big three would still essentially pay for their chunk. We are talking $10's of billion's Detroit automakers would be putting in upfront. However going forward...any funding would be paid for by the fee...and distributed based on who is selling the most cars at the time. The reasoning is that the companies who are selling the most now need to be paying the most now (when those profits are realized) because more success now=more employees, and retirees later. I am not sure how this could be seen unfair or as a tax. As the big three's retiree's move on to better places, and Toyota, or whatnot gains more retirees in the system, they would gain more control.

It would actually give foriegn companies a reason to build more factories here because then they could throw more employees under the fund, and gradually gain some control on the board. If you were a foreign company, what would you rather do? Pay a fee that goes to someone else's workers...or move production capacity to the US, and have them paid for by this fund to?

Sounds like a decent way to fix the regressive pension issue that currently exists.

One again...it is the big threes pension funds that will fund this thing up front. Also Ford, GM, and DCX still sell over half the cars sold in this county, so they still will pay the majority of the fees. However moving forward, the plan would basically say that we are gonna fund everybody's pension moving forward based on who is selling the most cars now...not who sold the most cars 30 years ago. Again, as Toyota, Honda, BMW put more workers in this fund down the road, they will reap the same benifits GM, Ford, and DCX would get, along with more control of it. Also, this fund would give a chance to rip up some past contracts, and make the pensions fairer.

Also, like I said, it encourages factories to be built here, because the more US based workers you have...the more whose retirement benifits you can have the fund pay. That makes more sense for a foriegn company then keeping all your production overseas...and paying in a fund you reap no beneits from.

We can talk what is fair, and what is not all day long...but IMO, it is not fair that we allow foriegn companies to come in here compete on equal footing with american companies, and displace american workers. Then we expect our legacy companies to now pay for all of this huge amount of displaced workers with smaller revenues and a smaller workforce. Regardless of how much GM's product may have sucked for years, you put 15-10 competitors, where there were once 3, and someone is gonna sell a lot less cars.

America has been a free market for a long time, but I also think it is time that these foriegn companies take a little social responsibilty to gow with all the american dollars they make.

One again...it is the big threes pension funds that will fund this thing up front. Also Ford, GM, and DCX still sell over half the cars sold in this county, so they still will pay the majority of the fees. However moving forward, the plan would basically say that we are gonna fund everybody's pension moving forward based on who is selling the most cars now...not who sold the most cars 30 years ago. Again, as Toyota, Honda, BMW put more workers in this fund down the road, they will reap the same benifits GM, Ford, and DCX would get, along with more control of it. Also, this fund would give a chance to rip up some past contracts, and make the pensions fairer.

Also, like I said, it encourages factories to be built here, because the more US based workers you have...the more whose retirement benifits you can have the fund pay. That makes more sense for a foriegn company then keeping all your production overseas...and paying in a fund you reap no beneits from.

We can talk what is fair, and what is not all day long...but IMO, it is not fair that we allow foriegn companies to come in here compete on equal footing with american companies, and displace american workers. Then we expect our legacy companies to now pay for all of this huge amount of displaced workers with smaller revenues and a smaller workforce. Regardless of how much GM's product may have sucked for years, you put 15-10 competitors, where there were once 3, and someone is gonna sell a lot less cars.

America has been a free market for a long time, but I also think it is time that these foriegn companies take a little social responsibilty to gow with all the american dollars they make.


You still make no sense at all. The closest thing to making your idea fair would be to enact significant tariffs against cars/trucks built overseas from being shipped into this country. Then you would be truly making things fair for the american worker by making the foreign workers pay for the displaced americans directly.

Otherwise, your point about "encourages foreign companies to build more factories here" makes absolutely no sense at all. There is no tax break at all for them to produce the car here, and now you're tying their employees hands to buy into some garabage pension fund when they'd probably be happier to manage their own 401k's like most workers in this country are doing these days. Your plan does mean those foreign make employees will control less of their money. Why don't you just legislate that you have to be a member of teh UAW to build cars while you're at it.

I mean seriously, you give me a choice of a company managed pension vs. letting me invest my money myself, no contest which i'd choose. Now add in government managed pension and it becomes a laughable choice.

And bigger tariffs would affect the big 2.5 a lot as well considering the number of vehicles and parts that they build and source from overseas.

In the end, this plan is solely focused on bailing out the UAW and has absolutely no tangible benefits to the average american. Whether it be a tax on every car sold, or tariffs, or whatever, the ONLY people who would stand to gain anything woudl be UAW members.

With that in mind, perhaps they shoudl just disband, take a pay out from the currently funded pension plans you mention and invest their money themselves like every one else in america has to these days. Pensions are dead in this country

I don't think it's a bad idea overall, although it does go against the idea of 'free trade' which if it was the US going in to China we'd bitch an moan about their tariffs and taxes and piracy etc.

I think most peoples atittude on here is why should auto workers get all these benefits when most of the rest of us don't get these nice benefits anymore from our jobs?

I know my personal bias feeling is. I can do YOUR auto job, you CAN'T do my IT job. Justify why should you get more then me?

I know my personal bias feeling is. I can do YOUR auto job, you CAN'T do my IT job. Justify why should you get more then me?

Right. Way too much, but it's the US auto industry!!!11111!!! going on here.

Yes it would be a shame if the big 2.5 were to go bankrupt because they crumbled under the weight of their previous bad decisions, but no more a shame than the ass loads of other americans who get laid off, or lose money on investments, etc every year.

I don;t think that would mean the end of the auto industry in this country though. Companies (including re-organized big 2.5) would fill in all the same voids as we have now, only without any UAW members in their factories, and wit their employees playing by the same rules as every other american work does these days.

edit, just realized i didn't share much wit the piece i quoted. For me it's not even about a bias of who can do who's job. It's just realism to the way all industry in this country works today, and that i completely fail to see any benefit to an extra tax being added to the price of a new car to bail out failing business with completely unrealistic union workers steering the ship right off the cliff.

You still make no sense at all. The closest thing to making your idea fair would be to enact significant tariffs against cars/trucks built overseas from being shipped into this country. Then you would be truly making things fair for the american worker by making the foreign workers pay for the displaced americans directly.

The difference is american and foriegn automakers pay this fee.

Otherwise, your point about "encourages foreign companies to build more factories here" makes absolutely no sense at all. There is no tax break at all for them to produce the car here, and now you're tying their employees hands to buy into some garabage pension fund when they'd probably be happier to manage their own 401k's like most workers in this country are doing these days. Your plan does mean those foreign make employees will control less of their money. Why don't you just legislate that you have to be a member of teh UAW to build cars while you're at it.

I mean seriously, you give me a choice of a company managed pension vs. letting me invest my money myself, no contest which i'd choose. Now add in government managed pension and it becomes a laughable choice.


If you were a foriegn automaker, and paying a fee on every vehicle you sold in the US that pays for the retirement of US based autoworkers...wouldn't it make more sense to have a lot of US workers that this fund would pay the retirement of, insead of overseas workers, which you have to foot the bill on, while still paying the fees. Makes perfect sense to me. Also, since the board that manages the fund would be made up of half worker representatives, they would have some control over it. The government would audit it to make sure there is no fraud...not control it.

I think if given a choice between a decent fixed pension plan, or a 401K, most people would take the pension. Plus...I have always seen 401K's as supplement to a decent pension...not a replacement. If you only have just a 401K, you have a shoddy retirement plan (IMO) that is tied to the well being of Wall Street. I really don't think that many people on their own could steer a 401K plan to beat a well managed fund managed by professional investors.


And bigger tariffs would affect the big 2.5 a lot as well considering the number of vehicles and parts that they build and source from overseas.

That is where you are confused. This is a fee attached to every vehicle sold in the US regardless of who makes it, or where it is made. GM, Ford, and Chrysler would be paying it too.

In the end, this plan is solely focused on bailing out the UAW and has absolutely no tangible benefits to the average american. Whether it be a tax on every car sold, or tariffs, or whatever, the ONLY people who would stand to gain anything woudl be UAW members.

This is more about bailing out the big US automakers. But as for the people...there are millions of UAW retirees.

Any of the big three goes bankrupt and can't fund the pension plans....you have an economic disaster. On top of that...when they do go bankrupt...guess who pays for those pensions?

http://www.pbgc.gov/

Yup....that is a governement controlled, tax payer funded entity...and they pay retirees dimes on the dollar. Just ask the Bethlaham Steel retirees. I think my idea is a little better.

Wth that in mind, perhaps they shoudl just disband, take a pay out from the currently funded pension plans you mention and invest their money themselves like every one else in america has to these days. Pensions are dead in this country

I really think your average worker would rather have a fund managed by people who know what they are doing rather than do it themself and risk loosing large sums in the stock market.

Right. Way too much, but it's the US auto industry!!!11111!!! going on here.

Yes it would be a shame if the big 2.5 were to go bankrupt because they crumbled under the weight of their previous bad decisions, but no more a shame than the ass loads of other americans who get laid off, or lose money on investments, etc every year.

I don;t think that would mean the end of the auto industry in this country though. Companies (including re-organized big 2.5) would fill in all the same voids as we have now, only without any UAW members in their factories, and wit their employees playing by the same rules as every other american work does these days.

edit, just realized i didn't share much wit the piece i quoted. For me it's not even about a bias of who can do who's job. It's just realism to the way all industry in this country works today, and that i completely fail to see any benefit to an extra tax being added to the price of a new car to bail out failing business with completely unrealistic union workers steering the ship right off the cliff.


You already pay the fee on every american car you buy...it is built into the cost. All this does is redistributes it based on how many cars are being sold now, and gives everyone a little peice of the pie to pay.


You can bitch and moan about unions all you want...but these are people who worked for a middle class living their whole life. They buy worked for GM, and for the most part buy GM products. Pull the financial rug our from under them, and rip agreements up, and you have an economic disaster.

You guys are arguing like this "idea" is actually going to happen.

The difference is american and foriegn automakers pay this fee.


So you're going to double charge this fee to the big 2.5, after all, they're already paying into the system, so any new fee will surely be in addition to what they are already paying? Of course not, i was just being silly here

If you were a foriegn automaker, and paying a fee on every vehicle you sold in the US that pays for the retirement of US based autoworkers...wouldn't it make more sense to have a lot of US workers that this fund would pay the retirement of, insead of overseas workers, which you have to foot the bill on, while still paying the fees. Makes perfect sense to me.

You must have a lot of UAW friends and family if that makes sense to you. All you're suggesting here is legislating that all american autoworkers are tied to the UAW through at least their pension plan. I doubt this would have as much of a desired effect as you think, and in the end just makes everybody's stuff more expensive, even the big 2.5 who now build so many cars out of the country with non-UAW workers.

Also, since the board that manages the fund would be made up of half worker representatives, they would have some control over it. The government would audit it to make sure there is no fraud...not control it.

I think if given a choice between a decent fixed pension plan, or a 401K, most people would take the pension. Plus...I have always seen 401K's as supplement to a decent pension...not a replacement. If you only have just a 401K, you have a shoddy retirement plan (IMO) that is tied to the well being of Wall Street. I really don't think that many people on their own could steer a 401K plan to beat a well managed fund managed by professional investors.

No, i do have a pension plan through my company as well as a 401k, but i look at the pension like i do social security. It's likely going to be a joke by the time i retire. Pensions are dying in this country. You whine that a 401k is tied to the health of wall street. Well your pension is tied to the health of your company. I have a lot more faith that the american stock market is still going to exist in 35 years than i do in my company. And as such, i'd prefer to invest my money in the diversified stock market than soley into my company which could go bankrupt and leave me with next to nothing.

That is where you are confused. This is a fee attached to every vehicle sold in the US regardless of who makes it, or where it is made. GM, Ford, and Chrysler would be paying it too.

This is more about bailing out the big US automakers. But as for the people...there are millions of UAW retirees.

Any of the big three goes bankrupt and can't fund the pension plans....you have an economic disaster. On top of that...when they do go bankrupt...guess who pays for those pensions?

http://www.pbgc.gov/

Yup....that is a governement controlled, tax payer funded entity...and they pay retirees dimes on the dollar. Just ask the Bethlaham Steel retirees. I think my idea is a little better.

Better? Better for who? Oh, the UAW retirees. Right, i noticed that about your plan a while ago. It has no benefit to the average american.

This doesn't bail out the american auto companies. If the UAW wins such a major concession as a government bailout for the security of it's retirees, do you really expect me to believe they will stop trying to kill the big 2.5 every chance they get?

I'd just as soon watch the big 2.5 go bankrupt, tear up the UAW contracts and start over as i would to bail them out when they have done anything but accept the fact that they need to make major concessions for their own job security. If the UAW wants to drive teh big 2.5 off a cliff, that's THEIR problem, not mine.

BTW, remember earlier in this post when i pointed out that the big 2.5 make a lot of their cars overseas and in canada/mexico now? In the end this extra tax just increases their costs because now they have to pay even more into the UAW pension plan, rather than just having to pay in the employee part for their current workers. IOW, no benefit to the big 2.5

I really think your average worker would rather have a fund managed by people who know what they are doing rather than do it themself and risk loosing large sums in the stock market.

If the average worker realized how much more tenuous a pension is compared to a 401k they most certainly would not. It's pretty hard to screw up your 401k nearly as bad as your company going bankrupt or being sold out and split up would to your pension.

The fact that this entire thread was started in the name of how to save the UAW's pension plan really highlights just how secure pensions are, doesn't it.

So you're going to double charge this fee to the big 2.5, after all, they're already paying into the system, so any new fee will surely be in addition to what they are already paying? Of course not, i was just being silly here

Do you have a reading problem? They would put their current pension funds togethor to create the fund in the beginning. Then going forward the fee would be the source of income for the funds. After the initial consolidation, domestic automakers would pay into the fund through the fee...insead of making contributions to their pension funds like the do now.


You must have a lot of UAW friends and family if that makes sense to you. All you're suggesting here is legislating that all american autoworkers are tied to the UAW through at least their pension plan. I doubt this would have as much of a desired effect as you think, and in the end just makes everybody's stuff more expensive, even the big 2.5 who now build so many cars out of the country with non-UAW workers.

I have no UAW friends and family. This is also no tie to the UAW. All pensions will be payed for by the fund, which would have a board made up equally of employees, and automakers. The actual seats would be distributed based on the number of employees the fund was currently paying. I am not sure how it would make anything costs more?

No, i do have a pension plan through my company as well as a 401k, but i look at the pension like i do social security. It's likely going to be a joke by the time i retire. Pensions are dying in this country. You whine that a 401k is tied to the health of wall street. Well your pension is tied to the health of your company. I have a lot more faith that the american stock market is still going to exist in 35 years than i do in my company. And as such, i'd prefer to invest my money in the diversified stock market than soley into my company which could go bankrupt and leave me with next to nothing.

Tell that to all the people who delayed retirement because their 401K took a **** around 2001. 401K's are dangerous in that if the stock market takes a crap ALOT of people loose money. If your company takes a crap...the damage is much more localized.


Better? Better for who? Oh, the UAW retirees. Right, i noticed that about your plan a while ago. It has no benefit to the average american.

Blah...UAW retirees are average americans...probaly 2 million plus of them. They suddenly have no income...we have an economic disaster that effects everyone.

I honestly could give a rats ass about the UAW. Unions were needed once, but not anymore. If the ideas I have were implemented, the UAW would become basically obsolete anyway.


This doesn't bail out the american auto companies. If the UAW wins such a major concession as a government bailout for the security of it's retirees, do you really expect me to believe they will stop trying to kill the big 2.5 every chance they get?[/quote[

Yeah...the UAW wants to kill the automakers that pay their pensions, and feed their families. You are making ZERO sense now.

[QUOTE]I'd just as soon watch the big 2.5 go bankrupt, tear up the UAW contracts and start over as i would to bail them out when they have done anything but accept the fact that they need to make major concessions for their own job security. If the UAW wants to drive teh big 2.5 off a cliff, that's THEIR problem, not mine.

How would you like it if you were promised a decent retirement, and then you company said..."Oh...wait a minute, you need to pay twice as much for healthcare because things or tight"....of "Oh, you get less retirement pay this year because things are tight". You are retired....there is nothing you can do...but fight for what you have. If you actually paid any attention, you would realized that the last few years, the UAW has fought to keep what was promised it...not gain anything new. While I think it is easy to sit on a keyboard, and say people are greedy...you view would be different if you lived on a fixed income in you 70's and had to pay twice as much for health insurance.

BTW, remember earlier in this post when i pointed out that the big 2.5 make a lot of their cars overseas and in canada/mexico now? In the end this extra tax just increases their costs because now they have to pay even more into the UAW pension plan, rather than just having to pay in the employee part for their current workers. IOW, no benefit to the big 2.5

Gives them an advantage to make more cars in the US also...which is what we want:)

If the average worker realized how much more tenuous a pension is compared to a 401k they most certainly would not. It's pretty hard to screw up your 401k nearly as bad as your company going bankrupt or being sold out and split up would to your pension.

The fact that this entire thread was started in the name of how to save the UAW's pension plan really highlights just how secure pensions are, doesn't it.

Stock market is just the same. I remember all the old people in my office having a fit around 2001, when the stock market went down, and their 401Ks lost 200,000+ in weeks.

Looks like something similar to my idea may happen.


http://money.cnn.com/2007/07/23/news/companies/uaw_talks/index.htm?cnn=yes

I know alot of thought went into this but its a bad idea. Toyota and Honda have no obligation to "unburden their competition." Just the oposite. Suppose the tables turn and its GMs turn to unburden Honda and Toyota?

I could see something being used to negotiate our way into Japanese market. The govt would have to say fair access to our maket = fair access to yours
I do believe if you sell here a percentage of your workforce should be mandated to be here. At least 30-40% Im including non auto companies...

but thats just my 2 cents

Agreeing to take on the health care costs would put the union in the uncomfortable situation of being the one to cut benefits or coverage or raise out-of-pocket costs for its retired members if the funds assets don't perform as planned, or if health care costs rise faster than expected.

If they can get the UAW takes on healthcare it will be almost comical when the union is put in the position to cut benefits because they realize they can't afford it.

Looks like something similar to my idea may happen.


http://money.cnn.com/2007/07/23/news/companies/uaw_talks/index.htm?cnn=yes

I guess you could look at it as 'similar' if you ignore that a big part of your idea was the foreign makes having to pay into the plan since they sell cars here and have displaced union workers.

I think this is one of those ideas that “sound” good until you look beneath the surface and begin to realize all it implies.

The very concept of the government stepping in and controlling any specific industry’s retirement system is scary to say the least not to mention absolutely contrary to our economic system - the plan proposed is mostly social (in)security by another name but with an initial “fund” provided by existing pensions (which are already facing liabilities they can’t meet).

Does anybody here truly think the Government can solve this problem better than private industry? I guess some will but I certainly don’t.

Detroit’s problems are not an issue of “unfair competition” no matter how loudly or how often that mantra is proclaimed...foreign automakers have played by the rules established by the U.S. (often with the lobbying and approval of UAW/Detroit Big 3)…to come back now and say those rules were unfair because they didn’t break the way one group would have liked and saying now you’ve got to “pay up” is what would be truly unfair.

I don’t suggest there is an easy solution to the problems Detroit is facing but “Government” (or socialistic approaches such as universal healthcare, etc) are not the answer. At best, those can only treat the symptoms but will never cure the disease.

Ohh no I agree with R.N. lol jk man. ;)

But again yes it does sound good and it sounds possible to an extent. Not arguing with you man. I wish it was that simple..is it?? who knows..but again not arguing just nodding in agreing with you at least. Your points are valid but the thing is its the time and the destruction we have set in motion of what is presented now. Like mentioned import companies have been playing buy the rules WE set up. Seams like we should of changed the rules a long time ago. The big 3 should of made better cars in the 80's. Not the problem now but sure is the problem that was created out of this legacy cost.
If the U.S. treated its pride of being built here in the U.S. kinda like many other countries. They did it from the beggining then we would have no problem. the Japanese do this and look at them. Strong national pride in products they produce. Strong home grown product buying and the willingness to expand that base with companies that have the green light like here in the U.S..
The U.S. exact opposite?? Why is that?? Strong national pride in products we produce?? Nope we go for something else. Strong home grown buying? Nope we buy from anywhere anyone and anything. Strong product buying from companies that want to expand? Nope again we buy whatever we want cus were Americans and thats fine with us. Till like mentioned thes mistakes that could of been prevented pop up and the riot act is read and guess what..It is too late..and it is..unless there is a huge "Made in the U.S.A." movement in the next 10 years..there will be a very large hole to fill that was the big 2.5...

sad but true..

Looks like I had a peice of it right or so...

http://biz.yahoo.com/ap/070923/auto_talks.html?.v=11

The UAW is seeking guarantees of new vehicles to be built in U.S. plants in exchange.

That sounds like a reasonable demand... but if only the UAW agrees to plant closures of some of GM's current plants. GM (and its Detroit neighbors) are oversized for their existing market volume - everyone knows that. :confused: