While this is off topic on GM’s sales, I still feel compelled to speak my mind.
Why is it that when anyone says anything negative about unions, suddenly they are attacked and vilified as some evil criminal. Also, the premise that the only way an individual could earn a decent wage is to be a member of a union is absurd. I have never been a member of a union and never worked in an area with unions members until my current position (I have union members that work for me currently). I have always earned a decent wage and felt I was paid well for my efforts, and yes I have worked blue collar jobs much of my life. I believe that many in America and even the world are led to believe the only way they can receive a living wage and work in a safe environment is to be a member of a union. However, this just isn’t true in modern America. Sure, unions had their place many years ago, but here recently they have done more to harm their workers than help them. While many look at the purpose of unions from a one dimensional point of view, you also have to think of a larger picture to see what they have done to industry in America and the American job market. By artificially raising wages above what the labor market will support, they are doing more to drive jobs overseas than any other factor.
Some speak of “basic economics” when pointing out that union workers will buy goods and services with their abnormally high union wages as if they are solely responsible for the economy in this country. However, if these educated individuals paid attention in any basic economics course they would have learned that price floors on wages tends to create an abundance of labor and a shortage of jobs and actually hurt employees. Price floors and price ceilings prevent the labor market from reaching a point of equilibrium.
Any one truly familiar with economics will recognize the below graphic and identify the supply and demand slopes.
Assuming that without labor price floors companies will suddenly take advantage of the workers is a bit short sighted. If companies want to attract a skilled labor force then they will have to pay, otherwise those desirable workers will go elsewhere. That has never been as true as it is now. People can job search on the internet for jobs all over the country. People can easily relocate to almost anywhere. You go where the jobs are.
Yes, unions did serve this country well, many years ago. However, we currently have enough labor and labor related regulation in place to protect workers. I once heard a union worker state that without a union, he wouldn’t have any of the safety gear he has. I guess he hasn’t heard of OSHA.
Yes unions bargain for benefits like pensions, health care, etc, and all that becomes a part of the cost of labor. Manufacturers have to absorb the cost or tack it onto the product. Then you encounter similar supply and demand curves based on product price.
If you feel that company executives are overpaid barons that are trying to bleed everyone dry, then you are free to work to put yourself in a position of authority to change that. Go to school, make the personal sacrifices needed to achieve a executive position and change things.
I don’t blame unions for all of GM and Chrysler’s economic woes. Their management played a big role in the demise of these once great brands. Banking heavily on large vehicles even as fuel prices climbed, then acting surprised when people quit buying SUV’s and trucks when gas hit $4.50 a gallon. Still, the unions are not without blame. They continued to push for concessions and benefits even as they watched sales slow to a crawl as if the money came from magic beans planted in the field.
And yet when the whole thing started falling apart, our elected officials decided they would save the day. Free stuff, everybody likes it. They came in and made deals with the unions, left the bond holders out and told them if they complained, they would get nothing. So much for the rule of law. Of course the politicians would come to the aid of the unions, they will help you with campaign contributions and votes. Everybody wins! Except the tax payers and bond holders. Don’t think you were affected, if you have an IRA or 401K, chances are you paid part of the price for that shady deal.
Yes, Ford took Gov’t backed loans, for the Administration’s “green energy” plan. Who would blame them, cheap loans with tax breaks to boot. However, Ford wasn’t falling apart at the seams like GM or Chrysler. Ford had to deal with the same unions, government regulation and encountered the same economic woes, so how did is it they didn’t have to be bailed out or go through bankruptcy after the bail out? Slightly better management I would venture to guess. Still, let the government get involved in your business and it is bound to have its affects. Ford seems to top another list floating around of most unreliable vehicles and I think the hybrids are a big part of that. Selling your soul doesn’t come cheap.
So I am not some anti-union evil demon, but I recognize the destructive power they have. I know many people who vowed to never own a Chrysler Jeep product when the union workers who was caught drinking and smoking marijuana on the job were reinstated due to the union. The unions don’t just push for artificially high wages, they also enable the lazy, criminal and inept to keep their jobs (with back pay). But many union supporters won’t see the irony in that. Sure, they got to keep their jobs, but the bad publicity hurt sales. Oh well, plant some more magic beans in the yard and ask for more money. We’ll just promise to help the politicians.
Don’t think the unions and government result in destruction, look at Detroit. Detroit’s fate awaits any municipality or region that allows Unions, government, lobbyists and politicians to climb into bed together.
So drink the kool-aid and stick your head I the sand when you see companies moving jobs overseas due to high labor costs. I am sure some politician will come along and tell you “it isn’t your fault”, it is that “other” guy’s fault you lost your job. Everyone likes being told they are a victim and unions and politicians are so good at selling victimization.
The fact that GM has slightly lower truck sales than Ford is simple. Ford manages to produce a product that is more desirable and priced at a point that is more appealing to consumers. Whether Ford’s increased sales are based on a better product, aggressive pricing or better marketing I can’t tell you, if any of us knew for sure, I am certain executives in the auto industry would like to talk to you.
Don’t even get me started on the “too big to fail” banks. I think the government should stay out of all business. I did not like the bank bail outs either. Again, that was another money laundering scheme for politicians. Tax payer dollars to the banks, campaign donations to the politicians along with other shady deals.
OJ
