I worked at a grocery store that was unionized, and it sucked. We had to pay $6 a week for basically no reason, because the union only helps people that have decided to make a career working in a grocery store. Biggest waste of $700 in my life.
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Originally posted by Pandagirl! View PostI worked at a grocery store that was unionized, and it sucked. We had to pay $6 a week for basically no reason, because the union only helps people that have decided to make a career working in a grocery store. Biggest waste of $700 in my life.
My 2nd and 3rd co-op terms in univesity were working as a junior financial analyst for a municipal health care facility. All non-management workers, including myself, were unionized. Union dues were ~$25 a week, I was not allowed to go over 40 hours a week and I made $23 an hour doing basic analysis in Excel.
Now imagine how surprised I was to find that all my co-workers were 45-55 year old women who had been working at the same position for 15-20 years. They were probably making $60-70K doing the same job a university student would be willing to do for half that.
I don't like the idea of businesses exploiting workers, but I also don't like a system that encourages mediocrity with little reward for self improvement.
I'm now a Senior Analyst for one of the countries largest companies (in market cap), making $65K in base salary. Of course I also average 52 hours a week, which works out to $24 an hour. My role and knowledge are vital to the company and the Finance department would be screwed if I left, but I'm making just a little more per hour than a union co-op position.
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Unions are well worth shitting on for getting us into this mess but, let's be honest, they aren't the main culprits.
Yes, unions have fucked the car industry with high wages and pensions and unemployment and, as vihtha pointed out, paying people to NOT do their jobs. But the car companies have placated the unions for how long? (Granted with the help from the Federal government)
I place the majority of the blame on the car companies for all the reasons I put in my wall of text 5 posts ago. Those being:
1) The Big 3 haven't posted gains in more than 2 decades. If we give them 25 billion in taxpayer dollars, what reason do I have to believe it won't just go down the tubes?
2) The writing has been on the wall for, like, ever. I think it was Dodd who was like 'no one can say they didn't see this coming.' And that's exactly right, companies (especially huge ones like GM) have analysts whose only purpose is to forecast sales and general trends. So, either these analysts were completely retarded (doubtful) or they were saying what they needed to in order to keep their jobs and CEOs happy.
3) The car industry in the United States is obsolete. We will never again be able to compete with foreign manufacturers. We simply can't make cars at the same cost as foreign manufacturers. And we ignored the general trending of the Global markets need for fuel efficient vehicles in favor of SUVs and trucks. Now the Big 3 say they're in the process of reorganizing but this isn't a new concept, it's been the reality for years.
4) For the people who are like 'how come these banks get a bailout and we don't,' you're stupid. The banking system, by and large the US banking system, is what holds up the global economy for better or for worse. If all of these banks were allowed to fail, the upheavel would be much worse than the loss of 1.2 million jobs. (And the bankers knew this)
5) The unions are bastards. These people make the most money and get the best benefits compared to any other assembly-line workers in the country. And when American's started buying less cars the solution, in the eyes of the UAW, was not to fire people, it was to close factories yet keep the employees on the payroll. What other industry does this? I can't think of any, that doesn't mean they don't exist. These people are like a leech stuck to the back of a leech.
6) It honestly just really pissed me off that the CEOs feel entitled to this money, as was evident if you saw the hearings. Fuck these guys. You've cried wolf practically every half a decade so now when you throw around this Chapter 13 bullshit no one believes you. Wonder why.
Edit: It's also worth noting an article I read yesterday about what the effects of the bank bailout will be. It said that the money being injected into the banks is likely to help sure up credit for medium to large sized businesses. So, in essence, the trickle down bailout that was supposed to eventually help out 'main street' is doing just the opposite, and the federal government has fucked us again.Last edited by Vehicle; 11-19-2008, 04:22 PM.Vehicle> ?help Will the division's be decided as well today?
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2:BLeeN> veh yes
(Overstrand)>no
2:Vehicle> (Overstrand)>no
2:BLeeN> ok then no
:Overstrand:2:Bleen> veh yes
(Overstrand)>oh...then yes
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what, after one bailout everyone starts asking for bailouts? wonder who called this one
what, unions suck? wonder who called this one
what, companies are living on government subsidies which mask their economic failings which lead to massive problems like this? wonder who called this one
the current fiasco is what happens when you think the economy is some static model, and you can keep it going by ensuring that "key" industries stay afloat. because in the real world, things change. quickly. like when Vehicle asserts that the american car industry is now dead - because he has no way of knowing whether or not someone is in their garage, right now, tinkering away on some air-powered engine of the future. i hope we don't make any pre-mature decisions on the fate of the car industry!
i hate unions, and yes, i blame them. my city is a GM city, my truck was made right here, probably by people who live on my street. but i gotta make my distinction here. i think that if employees are working shit conditions, then they are completely free to organize. but if that organizing is made into a 'legal' entity - ie, a government-sanctioned union - that's when problems start.
(edit: btw, at my last job, my fellow employees and i did actually organize against the owner and we got wage raises from 6.50/hr to 9.00/hr. and we did it without one law being passed. awesome)
the current situation is a glorious example of one of my favorite arguments against altruism - the question of who gets what, how, and when? here we are arguing over whether or not automakers are 'entitled' to anything - because once you make that altruistic jump, the idea is that you help everyone, and you put the good of everyone before yourself. i love how in one industry we would just love to help people, but in another industry, we scream and claw at the thought of helping them. it's as if this glorious altruism is some cut-and-paste philosophy that applies to some people, but not to others.
of course, most of you already have a car, so you could give less of a damn about those guys. but bankers do hold your money, and that money is yours - so you'll want to ensure that those banks stay afloat, because them failing could mean you losing your money. it's awesome how altruism always seems to be merely the most vain egoism, hidden in even more vain altruistic rhetoric.
i don't see any reason to not help the automakers. by the prevailing philosophies of the day, it's the most imperative thing to do. free markets have failed. the CEO's have failed. selfishness has failed. individualism has failed. so why not take this moment to begin the new Sarkozy-style capitalism? it's like capitalism, except the 'capitalism' part. crank up those printing presses and let the money flow. because it's not goods that are valuable, it is money in-of-itself. as long as we have enough inked paper floating around, the fundamentals of the economy will remain strong.Last edited by Jerome Scuggs; 11-19-2008, 05:04 PM.
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Companies that can actually compete, be innovative, and function without government funding will rise from the ashes if we allow these gluttons to burn to the ground (like they so well deserve to). Once you cry that you can't keep running without the government handing you the tax money of every working American it's time to cut your losses and drop out of the market. The entire notion that a company is "too big to fail" is ridiculous. Not only that, but these companies had every advantage in the world when they started out, and squandered it by refusing to stay in touch with where the market was moving.
Smaller companies in the world grew large enough to threaten them because they actually have to make a decent product to continue posting profits. The same sort of thing will happen within the country too when we stop subsidizing incompetence.help: (qg) (javs): i think my isp is stealing internet from me.
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another thought: now that we have begun bailing out industries of any nature - is that what is going to happen the next time an industry fucks up? or do people seriously think that banks will never fuck up this bad, again? especially now that they know that their fuck-ups will be taxpayer- and treasury-funded?
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I think a more basic problem with the American car companies is actually a structural problem. The problem is in a few different ways:
1) They companies got too big for their own good
The problem when you have very large players is that, in order to protect market share, they have the scale and power to do very preditorial pricing which protects their position. But then again, on the flipside, very large corporations are so well established, that after a long time, they have less and less incentive to innovate. This is due to a very basic human instinct. There's no one to 'beat', so there's no reason to try harder.
2) Government intervention and union power
A large corporation by itself is no problem as there are three major carmakers in the USA. That is more than enough to ensure good enough to ensure competition. The second part of the problem is that since every company got the same labour contracts thanks to the UAW, a lot of possible competitive edge from one company to another was destroyed. Furthermore, government intervention to keep these companies afloat (i.e. lax mileage rules which hurt foreign car makers, bailouts) also keep these companies very static and complacent, so the effect of having three competitors is greatly diminished as no matter how hard you hammer your competitors they will not fail nor do you have to try all that hard thanks to low mileage rules until the recent oil crisis.
3) No room to expand
The USA is only so big. Most people who can afford a car already have a car, and then a second car and then a third car. Meanwhile foreign countries have very powerful import rules and levies on foreign car manufacturers. For this reason, you'll only see German cars in Germany and Japanese cars in Japan. With the exception of China (which GM for instance is thriving in), most countries outside of North America have very strict rules for cars. Meanwhile North America has very lax rules, where any company is allowed to set up shop here.
What does that mean? It means that foreign car companies have a monopoly in their home markets, and have a safe base there to expand to Canada and the USA. Meanwhile American car companies find it very hard to go foreign, but even their own home turf is continuously under heavy competition from foreign competitors.
Going back two paragraphs we see the problem. Because population growth is only so fast, the way car companies have made people buy more American cars is: VERY LIMITED foreign expansion comparatively, and at home forcing people to buy more cars. This means that per capita people own a lot of cars, but even that isn't enough to keep up growth. So then they started making crappy cars that break very easily, so people will need to buy MORE cars. Surprisingly, cars made in the 50s and 60s were much more well made.
This was not such a big deal in the 70s and early 80s when foreign competition was still taking root, but has now increasingly become a huge problem. Because of heavy concessions to organized labour, and an inability to do bold expansions (thus have the borrowed capital to switch things around) American companies have been slow to turn away from the mantra of easy to break, more purchase back to that of quality.
4) Union power
No, not what you think. I've already talked about labour costs, but the fourth huge problem in the American auto industry is dealing with organized labour. For the last 20 years, the energies of upper management has been concentrated on negotiating with organized labour, figuring out how to pay legacy payments, and finding creative ways to close factories and move them away to other countries while battling labour. All of this would quite obviously sap the energy of a lot of executives and could only be detrimental.
5) American-style capitalism
In America, it's winner take all, where CEOs and other upper executives have made unimaginable amounts of money even from a generation of Americans ago. This has been based largely on huge pay packages, and also on stock options. Auto execs are not immune to this, they want what other executives have, which is high pay. The American system focuses heavily on quarterly performance, and manipulating of quarterly results to have favourable stock outcomes. As well, the American systems have lately been much more about short-term gain than long-term planning.
This is contrasted with say the Japanese, who as a culture favour long-term planning rather than short term. As well, pay is much more equalized in Japan as well as in Europe, and huge short term compensatory gains are not as important.
What does this mean? It means that unpopular but long-term solutions are favoured in foreign car companies. It means that doing things like using profits to fund dividends and stock buybacks are not used as much and profits are funneled into R&D much more in foreign companies. It means that they invest more in the future, while American car companies try and use today's profits to make a quick buck without much thought to the future a lot more.
6) Dynamic
I've outlined how the size of American car companies are constrained by foreign import laws, and American population (and competition from everyone) growth limits the growth of these companies. I've outlined how government policies and union policies contribute to static market share between the big 3. I've outlined how executive compensation and American style capitalism favours short-term gain rather than long-term forsight. I've outlined how executive teams in the Big 3 are constantly hampered by the amount of time and energy spent with labour problems. I've outlined how the car company's strategy of building cars that need replacing faster backfired thanks to foreign competition.
Well all of this puts together for one final point I want to talk about, which is about the company themselves. The fact is, when you have static companies, which are not growing, and which do not value long-term planning, they will obviously not attract the best and brightest. This can be in any industry, the upstart and growing companies will take the best hires, and also attract the top minds because they want to be part of something growing (stock options aren't bad either).
With American car companies being so static, they really have not attracted the best talent out there. And they have further suffered from this. From shotty construction, to behind-the-times manufacturing processes, to ugly car designs, and cheap interiors, all the problems previously mentioned are further magnified when you don't have the best people working for you because they'd rather work somewhere else.
Putting it all together. What does this mean? It means the system of having a Big 3 is doomed to failure. One or more of these companies must fail because without that, the others cannot grow. The unions must be broken because they sap too much energy and resources. And new growth companies need to be made to attract the best and brightest.
Is the American car industry dead? Absolutely not. Perhaps the next generation of American car workers will be working for companies like Tesla Motors, who knows. But the Big 3 must go.Epinephrine's History of Trench Wars:
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Scuggs, I pretty much agree with you. The point we differ at, though, is a major one. Yes industry changes quickly when something revolutionary happens, but I think it's pretty fair to assume that American car makers have been in bed with the oil industry for quite some time. That fact, coupled with the complete idiocy of their business model as far as supply/demand over the past five to ten years, are what makes me say that the American car industry is obsolete.
If I was smart enough to argue the economics of it, I would also assert that manufacturing as a whole in this country is obsolete. We simply can't make things at a cheaper rate than other countries. Why should we continue making things? So people don't lose their jobs? Well my point there is that yes the economy will take a big hit when 1.2-10 (depending on who you believe) million jobs are lost, but in the long run I don't see how it isn't the smart decision. Right now might not be the best time, this is true, but feeding a monster that hasn't been able to feed itself seems detrimental to our economy as a whole, although there could very well be some economic model that says otherwise.
It's true to say that it's one-sided to offer a bail out to banking firms holding your money but not to car companies that doesn't affect you one way or another. But at what cost does bailing out this industry come, and I don't just mean the initial 25,000,000,000 dollars? (I like to put all the zeros in because then your brain is like "are you fucking serious") What evidence do we have to suggest that these companies will start making money? As a matter of fact when (I think it was) Chuck Schumer asked this same question to executives they said that all of their cards were pretty much on the table or in the process of being laid out. I genuinely don't see how these changes are going to affect their bottom line, and I don't think most Americans do either.
I read the Mitt Romney article because he's my favorite Massachusett's punching bag and I think he actually laid out a valid argument, one that I made to my roommate, whose entire family are car dealers, last night. If these companies have to file Chapter 11, new inroads into UAW negotiations coupled with possible consolidation and downsizing of the industry could genuinely turn it back into a profitable one. However, I don't think giving auto makers a 25 billion dollar check is giving them any incentive to do any of these things and, rather, is tacitly admitting that 'hey, we know you guys can't turn a profit but what are you gonna do.'
Edit: Thank you epi for making all of my points in a far more concise and well thought out way. You make me look stupid and I appreciate it.Last edited by Vehicle; 11-19-2008, 05:44 PM.Vehicle> ?help Will the division's be decided as well today?
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2:BLeeN> veh yes
(Overstrand)>no
2:Vehicle> (Overstrand)>no
2:BLeeN> ok then no
:Overstrand:2:Bleen> veh yes
(Overstrand)>oh...then yes
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Epi, that was probably the most well-written thing I've ever read on this forum
I really, if not completely, agree with this analysis. The only thing I would have to point out is the underlying trend of protectionism that plays a part in each of your points and their consequences. I think the world's economies have adopted heavy amounts of protectionist measures, though they are never called such. And damn, brilliant job of showing the operation of dynamic markets and how they naturally rise and fall, even on an international scale. I agree -we should see how the Big Three fare on their own.
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Originally posted by Liquid Blue View Post****EDIT****-- Also forgot, anyone affected by DHL shutting down all USA locations? Ohio got raped since it was mostly based there in the US- Paradise or Panda, have you two heard anything about it?The song doesn't make your hands clap,
The hand claps make the song
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yea thanks I just remember seeing on a CNN article that something like 9,000 jobs in Ohio are going to be lost once DHL pulls out
that's ridiculousMy father in law was telling me over Thanksgiving about this amazing bartender at some bar he frequented who could shake a martini and fill it to the rim with no leftovers and he thought it was the coolest thing he'd ever seen. I then proceeded to his home bar and made four martinis in one shaker with unfamiliar glassware and a non standard shaker and did the same thing. From that moment forward I knew he had no compunction about my cock ever being in his daughter's mouth.
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Didn't someone a couple of months ago suggest that it takes a few years for a presidents work to truly be shown?
What's been his excuse lately for all these job losses and economic downturn? Witches? Jon Stewart? The Pope?gravy_: They should do great gran tourismo
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In order to really fix something I believe you have to understand how you got there, so that when you do fix the problem you don't end up taking a step in the same wrong direction. We are bailing out industries, why?
Let's take a trip into the past, a mere 8-10 years ago. The auto industry was far from struggling, China had only realized what industrializing is, outsourcing was not the new fad, the housing market was afloat, the Dow was not plummeting hundreds of points daily, and we were not pissing off OPEC on a daily basis. As everyone knows though, the world changes.
Outsourcing was the first to strike. Companies are always looking for a way to cut the cost at the bottom and give more to the top. Factories left America due to the high pay that they are forced to shell out in favor of exploiting the cheap labor they can get outside of America. Nothing substantial was done to limit or stop outsourcing at the forefront. It was initially not a terribly huge problem, but has escalated into one of our economy's biggest problems, and China's greatest fuel.
With China being the optimal place to outsource, the Chinese markets gained an exorbitant amount of revenue. They took this revenue and put it into industrializing their country. When a country that holds a significant portion of the world's population chooses to industrialize, they consume enormous amounts of resources (particularly oil). With the increase in demand of a necessity to keep any modern country functioning, it gave the oil companies the room to jack up prices with no risk of losing business, and so they did.
On top of China's (a footnote being India too) emergence as an oil consumer and industrial powerhouse, as well as still a glorious place for companies to outsource to, America took up going to war- particularly in the middle east. The war had two primary effects, it pissed OPEC off enough to raise prices to the point where is was severely effecting the working man and the American economy, and it made the country as a whole consume more oil to power the American war machine.
With an increase in oil prices from the aforementioned and other causes, the working man was out of somewhere in the range of $20-$50 a week sheerly in gas costs alone for their car. What may seem like a small amount of money weekly from person to person is actually quite a substantial sum of money. Millions of people are being forced to take $20-$50 dollars (If simply 1 million people were out of $50 dollars a week for fuel, thats $50 million out of the markets weekly....that adds up over time) that would circulate into the American markets out of them and instead put them into foreignly monopolized markets.
Having to divert a portion of their income to an increase in their cost of transportation and various other necessary bills such as heating, some ignorant Americans sought out a way to lessen the costs of their bills and fell victim to predatory lending. This temporarily allowed some Americans to continue to put the same amount of money they had before the gas hike into the economy, giving a false sense of stability. Then the ARMs fired off. People could not afford the price hike or did not realize there would even be a price hike on the cost of their homes. Foreclosures aplenty, and inability to pay for the loans that had been taken out left even more money being able to be funneled into the economy. This on top of other things lead to our current recession, but that isn't the point of this.
With the increase in gas prices, the average person was looking for a way to cut their bills. The Auto-Industry had to adjust, and the popularity and demand for the hybrid, a car that American industries are not big on producing, flourished. SUVs and Trucks became obsolete due to the vast increase in the cost to drive them, and on top of that companies even began to refuse them for trade-ins leaving many Americans in deep shit. People stopped driving the gas guzzling American cars in favor of the fuel efficient foreign models. The American people were essentially out of money and looking for a way to cut the bills. American money now was going to foreign companies in both the oil and automobile industries, while the housing market was simultaneously failing and there was a lack of money being put into the economy, recession was just knocking.
Now we finally get to the Big 3 Auto industries. What are they to do? An industry dominated by unions meaning the employers have to shell out far more than normal for their employees, that is becoming obsolete and losing money. The small fuel efficient foreign cars are the new necessity to compensate for the increase in fuel costs and the crunch of recession. The Big 3 had their sights set on bigger and better and more impressive, not fuel efficient and cost effective. The market changed in a way that they were unprepared for and that they did not adapt to. People could no longer buy from them either. They began to stop accepting trade-ins of the larger vehicles knowing that they could no re-sell them. The method of trade-in is how most average Americans purchase their new vehicle, so they lost business. Even their smaller compact vehicles cost more in the long term than the foreign models, so an educated buyer would dismiss the possibility of buying an American car. Losing sales and having to pay substantially higher wages than the foreign companies which exploit the non-unionized and non-American government regulated wages, what other choice did the big 3 have other than to fail and begin relying on government subsidies and bailouts? Furthermore why should the government bail out an obsolete industry? Unless it adapts to the market and goes hybrid, fuel efficiency, or some new form of engine, it is bound to fail no matter how many times you bail it out.TWDT Head Op Seasons 2, 3, and 4
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Originally posted by Epinephrine View PostMeanwhile foreign countries have very powerful import rules and levies on foreign car manufacturers. For this reason, you'll only see German cars in Germany and Japanese cars in Japan.
As for blaming the Unions, i just dont know enough about the "american union" but... im pretty sure its not the workers fault if a company struggles. Of course it would be better if people worked harder for less money, if that were our goal.
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Originally posted by Fluffz View PostOut of curiosity, what rules are you talking about? I would be surprised if there is a difference between a car and any other good. The only problem is getting the US cars trough the emission and safety tests. Afaik.
As for blaming the Unions, i just dont know enough about the "american union" but... im pretty sure its not the workers fault if a company struggles. Of course it would be better if people worked harder for less money, if that were our goal.
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