{"id":30945,"date":"2008-11-20T01:01:01","date_gmt":"2011-05-19T03:05:24","guid":{"rendered":""},"modified":"2011-05-19T03:05:24","modified_gmt":"2011-05-19T03:05:24","slug":"unions_and_the_auto_industry","status":"publish","type":"post","link":"https:\/\/admin.rushlimbaugh.com\/daily\/2008\/11\/20\/unions_and_the_auto_industry\/","title":{"rendered":"Unions and the Auto Industry"},"content":{"rendered":"
\n

RUSH: All right. Bob in Livonia, Michigan. You\u2019re next here on the EIB Network, sir. Nice to have you with us. Hello.<\/p>\n

CALLER: I finally get a hold of you. (chuckles) Say, I\u2019m one of those retirees from Ford, coming up on two years in December.<\/p>\n

RUSH: Yeah.<\/p>\n

CALLER: And I was watching some of the hearings there in Washington, and nothing\u2019s changed. I saw the same arrogance that I saw when I worked there.<\/p>\n

RUSH: Management arrogance?<\/p>\n

CALLER: Management and union — and union. Look, I hired in \u201975 at $4.42 an hour, and you remember 1980 what happened. I was laid off for four years. Okay? We got subpay back then, but it ran out very quickly in four months and so did the unemployment at six months. You know, 26 weeks. My health care, I think that stayed for about a year, but the dental went right away, within that first month, at the end of the month. And, look, Rush, I had to go out and get two $5-an-hour jobs, okay? My wife had to work. So, you know — and, look, you\u2019re looking at a 15 1\/2 percent unemployment rate; you\u2019re looking at a prime rate of, what, 21 and a half. This country was really screwed up.<\/p>\n

RUSH: Now, that was during the Carter years. You said you hired —<\/p>\n

CALLER: \u201980 — \u201984.<\/p>\n

RUSH: No, you said you hired on in \u201975. What was your hourly?<\/p>\n

CALLER: $4.42 an hour.<\/p>\n

RUSH: $4.42 an hour.<\/p>\n

CALLER: Yeah. In \u201968 when I hired the first time, was $2.28.<\/p>\n

RUSH: $2.28. Okay. <\/p>\n

CALLER: Yeah, and then I went in the service. But, see, wages went up over the years. I made a good wage, but, look, I went out and I spent my money wisely. The only thing I owe right now at 58 years old is four years left on my mortgage. I don\u2019t owe a dime to anybody, okay? I put three kids through college. I spent almost like 10,000 bucks in Hawaii on a vacation, another 10,000 in Alaska. I\u2019ve been to California, been to Disney World, been on cruises. My money is gone into the economy to help jobs for other services in this economy. It\u2019s not that it just went away.<\/p>\n

RUSH: Yeah, that\u2019s what the old days we called it trickle down. <\/p>\n

BREAK TRANSCRIPT<\/p>\n

I want to continue here with Bob from Livonia, Michigan. Bob, you\u2019re still there, right?<\/p>\n

CALLER: Yeah, I\u2019m still here.<\/p>\n

RUSH: What you were describing here was trickle down. You\u2019re running around spending the money that you\u2019ve earned and therefore you\u2019re helping other people stay employed.<\/p>\n

CALLER: Right.<\/p>\n

RUSH: You\u2019re spending money in Hawaii and Disney World and so forth, so you\u2019re facilitating other businesses operating. <\/p>\n

CALLER: Right.<\/p>\n

RUSH: So you got a good handle on it. But, look, strip all that away for a second. You\u2019re retired.<\/p>\n

CALLER: Yep.<\/p>\n

RUSH: You gave us the circumstances of your retirement. Are you still depending on Ford? You said you worked at Ford.<\/p>\n

CALLER: Yeah. Well, the last years that I worked there I was placed in that jobs bank. I was unhappy with it. I worked, so I —<\/p>\n

RUSH: I just wanted to specify Ford. Are you still being paid —<\/p>\n

CALLER: Yeah, yeah, yeah, yeah.<\/p>\n

RUSH: — a pension?<\/p>\n

CALLER: I get my pension, yeah, right. You know, 3,000 a month, whatever it is, with the survivors benefits, all that stuff.<\/p>\n

RUSH: And health care?<\/p>\n

CALLER: Yeah, I get the health care, too.<\/p>\n

RUSH: You get health care. So when you watch all this, when you watch all this take place and you hear that some people think, ‘Look, we just need to let \u2019em go bankrupt and redo these union contracts that just can\u2019t be honored. You can\u2019t continue to pay people that do not produce anything, that kind of money,\u2019 what do you think when you watch people say this?<\/p>\n

CALLER: Well, the retirement\u2019s one thing, but the jobs bank is the other thing. See, Rush, back in the eighties, I went to Minnesota after four years. Ford called me up one day and said, ‘Hey, we got a job for you, but guess what? It\u2019s in Minnesota,\u2019 and I had to make the gut-wrenching decision to root up my family and go. The way it is now, you could sit in this job bank and you could turn down an offer for another state. You don\u2019t have to go. To me, Rush, they\u2019re trying… They got socialism mixed up with capitalism, you know, with the business. It\u2019s like a socialistic thing. It just doesn\u2019t mix. You can\u2019t do that.<\/p>\n

RUSH: Wait a second. I just want to understand here. You\u2019re in the job bank. Are you being paid while you\u2019re in the job bank?<\/p>\n

CALLER: Yeah, we were paid in the job bank, but I got out of it. <\/p>\n

RUSH: But —<\/p>\n

CALLER: I retired. I flat-out retired.<\/p>\n

RUSH: Wait, now. You\u2019re not working, you\u2019re in the job bank but you\u2019re being paid. Then they call you up and they say, ‘Here\u2019s a job for you in Minnesota.\u2019<\/p>\n

CALLER: No, there was no job bank in the eighties. There was no job bank in the eighties. Everything ran —<\/p>\n

RUSH: No, I know. I\u2019m talking about now. I\u2019m trying to figure out how it operates now.<\/p>\n

CALLER: Now? <\/p>\n

RUSH: I\u2019m trying to figure out how it operates now.<\/p>\n

CALLER: Oh, now.<\/p>\n

RUSH: My question is: Do you get paid even when you\u2019re not working when you\u2019re in the job bank?<\/p>\n

CALLER: Yes.<\/p>\n

RUSH: And if today, when you\u2019re in the job bank and they call you and they say, ‘We\u2019ve got a job, and it\u2019s not where you live,\u2019 you can turn it down and still get paid. Is that what you\u2019re saying?<\/p>\n

CALLER: Exactly. That\u2019s the way it was set up. See, and it\u2019s disgusting. It\u2019s disgusting. That\u2019s why I left. I bought a franchise in fixing windshields. I\u2019m a franchisee, and that\u2019s what I\u2019ve been doing for the last three years.<\/p>\n

RUSH: Well —<\/p>\n

CALLER: It\u2019s worked out very well.<\/p>\n

RUSH: This —<\/p>\n

CALLER: I hire six employees, and that\u2019s what I do.<\/p>\n

RUSH: Okay, good for you. You\u2019ve finally entrepreneured it. That\u2019s superb. I love hearing things like that. I love hearing stories like this. Now, here\u2019s what\u2019s tough for me about this. I mentioned this earlier in the program. I am all for everybody earning as much as they can. I am not one of these that wants to sit here and place an arbitrary value on what someone\u2019s worth is. I want the market to do that. Interestingly, this is one of the — not problems; it\u2019s one of my — observations about unions in the past. They\u2019re fine, if that\u2019s for you, and if that\u2019s what you want to do. But when you join a union you have to realize that you\u2019re giving up your individuality and you\u2019re part of a giant unit and you\u2019re not going to earn any more than anybody else there does, regardless how well you do your job; unless you can finagle, you know, lots of overtime, things of that nature. <\/p>\n

But at some point when you\u2019re earning more than the market would otherwise say, there\u2019s going to become a day of reckoning. Now, I understand the auto companies. They agreed to this deal in the collective bargaining sessions with the autoworkers. This job bank business where you get paid for not working? (laughs) If you just strip it all away, who wouldn\u2019t take that? (laughing) <\/p>\n

‘You mean you\u2019re going to pay me and give me a pension and health care benefits for not working?\u2019 <\/p>\n

‘That\u2019s right, son.\u2019 <\/p>\n

‘Sign me up! And then you\u2019re going to tell me even if a job comes up, I don\u2019t have to take it, and I can still get paid?\u2019<\/p>\n

‘That\u2019s right, son.\u2019 <\/p>\n

Who is not going to take that? So these poor guys in the union — and I\u2019m talking about the rank-and-file now — who wouldn\u2019t take this? The auto companies negotiated these deals. I don\u2019t know what kind of gun was at their head and so forth. I have no clue. All I know is now that the day of reckoning has come, and whatever these labor costs are, particularly the labor costs on top for people who are no longer working, which means they\u2019re not producing anything, that just can\u2019t go on indefinitely. The tipping point here has been reached. (laughing) Snerdley is asking, ‘Why can\u2019t it go on forever like this? Government does.\u2019 The market imposes itself, eventually, here. These companies can\u2019t go print money, Snerdley. The government can. The government can continually run a deficit. That\u2019s why I said the other day, just bail out the government. Screw all of this and just bail out the government. <\/p>\n

We don\u2019t need to raise taxes. We don\u2019t need to do anything. Just bail out government. Just bail out the government. If we\u2019re going to bail out everybody else, bail them out, too. ‘Rush, that don\u2019t make any sense.\u2019 That\u2019s right! Exactly right. Now you understand why no bailout works. ‘How do we bail out the government?\u2019 Well, we just bail \u2019em out. ‘But the government is the one bailing out.\u2019 That\u2019s right. The government should bail itself out. ‘But, Rush, that can\u2019t happen.\u2019 Right. Exactly right. Nobody can be bailed out. All that does is forestall and delay the eventual day of reckoning. Now, as I mentioned earlier, labor costs are as much a factor in being competitive in the auto business as any other business. <\/p>\n

If one company making a product (in this case, cars) or if three companies making cars have labor costs that are twice as high as their competitors\u2019 labor costs, well, mathematics and human nature and behavior are quite common, and they\u2019re predictable. And it\u2019s very simple to see that the guy who makes the cars for half the labor cost of the other three companies is going to be able to sell his cheaper — and guess what people are going to buy? They\u2019re going to go buy the cheaper cars, particularly if they think they look better, or if they have whatever. They\u2019re going to find the deal. Everybody loves to tell you how they screwed the dealer, do they not? Everybody loves to tell you how they went to the dealership and they jawboned them and they argued with them and they got to below sticker. <\/p>\n

You say, ‘Wow, how did you do that?\u2019 And they tell you some cock and bull story about how, ‘Well, I offered cash. They\u2019ll take cash right off the barrel.\u2019 (snorts) I bought most of my cars recently with cash. It doesn\u2019t do a damn thing to the price. There are all these myths. When people buy a house, they can\u2019t wait to tell you how expensive it was; but when they buy the car, they tell you how cheaply they got it and how they really screwed the dealer. They knew more about the business than the dealer knew. They went to the website, they found out what the wholesale cost was. They knew where the lies on the sticker were, all that stuff. The point is, people are oriented toward the cheapest price they can get on a car. <\/p>\n

So these labor costs have come home to roost. (sigh) It\u2019s a real tough thing, for me, because I am not anti-union, and I am not opposed to anybody making a lot of money. I want anybody to make as much as they can when they\u2019re working, but there\u2019s no way… We\u2019ve proven it in Social Security; we\u2019ve proven it in Medicare. There is no way even a society as large and as prosperous as ours, the most prosperous in history, human history. There\u2019s no way a society can pay people enough money — interminably, forever, to where their life is also prosperous — when they\u2019re not working. It just doesn\u2019t work. At some point (and I fear that we have reached it) the golden goose, it\u2019s come home. I don\u2019t care who you want to blame. At this point, that\u2019s pointless. <\/p>\n

Blame the execs and you get all bent out of shape, they\u2019re flying in for these sessions to beg for money on their corporate jets. They\u2019re going to… It doesn\u2019t mean anything. Just it\u2019s bad PR for those guys, but they can\u2019t get in much worse PR shape, so what does it matter? You can get mad at the union leadership, the thugs out there who negotiated the deal. You can get mad at the rank-and-file. All that\u2019s pointless now. This is a situation only the market can repair. And that would appear to be through bankruptcy, either Chapter 11, Chapter 7, or 7 going into 11, however it all works. The bailout is… This bailout, I\u2019ll tell you something. You know what this really is? And I mentioned this yesterday, and this is even scarier. <\/p>\n

And I think this is why Obama is happy for even more crisis to come down the road and more volatility, more instability, \u2019cause Rahm Emanuel said: A crisis is a terrible thing to waste. You don\u2019t want to waste a crisis. Stop and think of that, folks. You don\u2019t want to waste a crisis. Meaning, to these guys, this crisis is an opportunity. It\u2019s not an opportunity for us. It\u2019s an opportunity for them. What they really want to do is use the panicked and crisis mode of the auto industry to set the guidelines by which they reorganize, with bailout money. This is what the Obama camp\u2019s going to do. And these auto companies are going to have to promise to make all kinds of environmentally friendly cars, as designed by environmentalist wacko lobbyists and activists both inside and outside the Obama administration. <\/p>\n

The greening of the US auto industry is where this is headed. ‘But, Rush! But, Rush! How do you know?\u2019 Because I know who Obama is, folks. We all do. We know where this guy\u2019s come from. We know what inspires him, what\u2019s informed him, what motivates him. He looks at every problem through the prism of socialism, collectivism, you know, whatever word offends you the least. ‘The government in charge of it all,\u2019 whatever you want to call it. And this is the greening of the auto industry, that\u2019s what\u2019s coming. And in addition to that, there will be limits on what executives can make. <\/p>\n

The unions will stay intact. Nothing will happen to them. There will be limits… Barney Frank, I think we\u2019ve got the sound bites. Barney Frank said. ‘Hell, 25 billion is not near enough. They\u2019re going to need a trillion.\u2019 Barney Frank\u2019s idea is that the US government own 80% of the US auto business. The Big Three that get the bailout, he wants the government to own 80% of it. When that happens… (interruption) No, no. I\u2019m not making this up. I read it in show prep today. I\u2019ve got some audio sound bites. We\u2019ll take a break here and I\u2019ll get to the Frank sound bites on this afterwards, when we come back from the break. <\/p>\n

But this is going to be loans, and until they pay it back, the government has an 80% stake. When the government has an 80% stake, they write the rules by which the company operates. That\u2019s where we\u2019re headed with the auto business, and any other business that gets bailed out. And then, once the government owns 80%, don\u2019t be surprised if somebody like Frank comes along and says, ‘You know what would be really fair? Let\u2019s us in the government just gift this 80% stake to the unions, and we\u2019ll have the unions own the auto companies. The unions will own 80% of the auto industry, and they\u2019ll get to operate it — and we\u2019ll finally get even with management, after all these years.\u2019 You watch, folks. Don\u2019t be surprised if down this road this is exactly what happens.<\/p>\n

BREAK TRANSCRIPT<\/p>\n

RUSH: Barney Frank. He was on NPR\u2019s Morning Edition today. Steve Inskeep was the presenter, and he said to Barney Frank, ‘I want to ask you about something mentioned in that report from economists from the University of Maryland. What makes you think the $25 billion for the Big Three would even be enough?\u2019<\/p>\n

FRANK: We don\u2019t think it would be enough. The way we have this structured, they will get $25 billion if the bill passes with a lot of conditions. If on March 31st the president does not believe that this is going to get viability with energy efficiency cars, they have to repay the loan, they get no more money. If they can show by March 31st a plausible way to go forward, then we would consider giving more money under, again, equally stringent conditions.<\/p>\n

RUSH: Are you hearing this? Give them the $25 bill, they have got \u2019til March 31st to move forward on energy efficient cars as designed by Barney Frank and the government. They can\u2019t retool that fast. Then they\u2019ve gotta give the money back. But if they can show plausibility to the (unintelligible), then they\u2019ll get more money. Now, here\u2019s more. So 25\u2019s not enough. How much you going to need?<\/p>\n

FRANK: AIG, which I don\u2019t think anyone would think was as important to the American economy as the auto industry, got $40 billion just now to make it up over $100 billion. To some extent let\u2019s not have a white-collar\/blue-collar bias in our public policy. There are those who say, hey, go bankrupt so you can cut back on what the unions have won. The unions have already made some concessions, but, you know, we\u2019ve had enough anti-union activity and enough increase in increment equality in this country, I don\u2019t want to set a precedent that bankruptcy now is the way in which you undo what gains unions have been able to hold onto.<\/p>\n

RUSH: So you can see how this is shaping up, we don\u2019t have any blue-collar\/white-collar bias in our bailout. This is the chairman of a House committee now, hundred billion may not even be enough, and he wants an 80% stake in the company for that. He didn\u2019t say that.<\/p>\n

BREAK TRANSCRIPT<\/p>\n

RUSH: Auburndale, Florida. This is Don. Don, I\u2019m glad you waited. Welcome to the EIB Network.<\/p>\n

CALLER: Hi, Rush. How are you doing today?<\/p>\n

RUSH: Just fine, sir. Thank you.<\/p>\n

CALLER: I spent 26-1\/2 years working for this corporation, and I was offered an early out at 55.<\/p>\n

RUSH: Which corporation? For which did you work out there, Don?<\/p>\n

CALLER: Do you want me to get killed? (chuckles) I don\u2019t know if I should tell you that, Rush.<\/p>\n

RUSH: Okay, okay. Was it auto company?<\/p>\n

CALLER: Yeah, yeah, yeah, yeah.<\/p>\n

RUSH: Okay.<\/p>\n

CALLER: I\u2019m 84 now, and I have been drawing a pension longer than I worked there. So that\u2019s doing pretty good, but I think the party is over. I really think that they\u2019re going to have go bankrupt, to save the companies.<\/p>\n

RUSH: Well, ultimately, yeah. See, if that\u2019s the objective. If the objective is to save the unions, then they won\u2019t go bankrupt. They\u2019ll do bailouts and continue to do bailouts and if the objective is to save Jennifer Granholm, if the objective is to save the state of Michigan.<\/p>\n

CALLER: It\u2019s not going to happen, though.<\/p>\n

RUSH: If the objective is to consolidate power for the Democrats and Obama, they\u2019re not going to let it go bankrupt. They\u2019ll keep bailing them out. There will be a bailout next year. There will be.<\/p>\n

CALLER: I would probably lose about two-thirds of my pension, but I\u2019m willing to sacrifice if I have to, to save the companies I worked for.<\/p>\n

RUSH: That\u2019s awfully big of you, Don. There aren\u2019t too many people that would do that.<\/p>\n

CALLER: Well…<\/p>\n

RUSH: Especially not at your age.<\/p>\n

CALLER: Well, I have an IRA. I went into job shops after I retired for ten years, and I saved quite a bit of money in IRAs, although they\u2019re in the tank now; and all my stock market investments are in the tank. (laughs) So I don\u2019t know, Rush. We\u2019re just hanging on by our teeth. <\/p>\n

RUSH: Yeah, but you\u2019re still laughing about it. What else can you do, I know. But you still have a great frame of mind about it.<\/p>\n

CALLER: Well, there\u2019s no sense. I have my health, so what do I care?<\/p>\n

RUSH: Well, that is number one. People sometimes forget that. But the older you get, the more you realize that. I\u2019ll tell you, the only honorable thing I think these auto execs can do now to save their companies and to save capitalism is to go the bankruptcy route. Because if anybody thinks that Harry Reid, Nancy Pelosi, Chris Dodd, and these clowns up there, Durbin, Schumer — if anybody thinks they know the first thing about running the automobile industry, then they deserve what they\u2019re going to get.<\/p>\n

CALLER: They can\u2019t… Rush, they can\u2019t put enough money in to sell cars at a thousand, 2,000, 3,000 more, then the Japanese are. It just will never work.<\/p>\n

RUSH: Well, you\u2019ve gotta get the operating costs down. If you don\u2019t have competitiveness in all of your cost areas, then your goose is cooked and that\u2019s what\u2019s happened. Don, you\u2019re a big man. I\u2019m glad you called. I\u2019m proud you\u2019re in the audience. <\/p>\n","protected":false},"excerpt":{"rendered":"

RUSH: All right. Bob in Livonia, Michigan. You\u2019re next here on the EIB Network, sir. Nice to have you with us. Hello. CALLER: I finally get a hold of you. (chuckles) Say, I\u2019m one of those retirees from Ford, coming up on two years in December. RUSH: Yeah. 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(chuckles) Say, I\u2019m one of those retirees from Ford, coming up on two years in December. RUSH: Yeah. 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