Photo by cursedthing
We saw the beginnings with the Battle of Wisconsin. The one place were unions were growing robustly was in the public sector, surpassing the private sector for the first time in 2009. But then 2010 happened.
International Metalworkers’ Federation
The Obama administration, having stepped in it with both feet to protect their union backers rather than let two of the three U.S. automobile companies go into bankruptcy, are now weighing the sale of the stock owned by us, in an Initial Public Offering (IPO). Their plans are to scale back the offering to prop up the price that they might be able to get in the market so that they can ultimately get most of the taxpayer money they spent, back.
“While both G.M. and the Treasury still hope to reduce the government’s stake in the company to less than 50 percent and rid the company of its Government Motors nickname, that goal may not be met, one of the people said,” according to the New York Times. In saying that, auto analysts are increasingly projecting that the government could get most or all of its remaining $43 billion investment, but it will takes years to accomplish. Uh-oh.
Our once proud automobile industry
The government institutes regulations such as CAFE that force the automobile companies to build many cars they can’t sell at a profit for each car they can. The unions negotiate contracts that pay people who have been let go 90% of their salary and give retirees extremely generous packages. The automobile companies stagger under this load to the brink of bankruptcy and what happens? The CEO of GM gets booted out and the government and the unions end up owning the car companies. In the case of Chrysler the UAW will end up owning 55% of the company if the government’s plan is approved.
Had the automobile companies gone into bankruptcy before the bailout, as this author advocated, the union contracts could have been voided and a new workable deal struck. But the government said bankruptcy was bad. The government said we had to give the car companies billions of our tax dollars. The government said, if you automobiles companies don’t accept our deal, you will be forced into bankruptcy. Huh?
So tell us again, Mr. Obama, how this is not socialism.
