No-one is saying workers are “paid” $70 per hour. They are saying that the auto companies’ true labour-related costs are $70 per hour. This is highly relevant, because if it is significantly higher than their competitors, it makes them less competitive, and thus more likely to go bust. Which is what they’re in the process of doing.
The figure couldn’t be more relevant if it were stapled to Dumbo.
Did you read my whole post sir? I pointed out further down that even taking out the $16 per hour in legacy costs would still place Big three compensation at least five dollars an hour higher. It’s hard to be specific because the article only says sub 50 for Japanese the manufacturers. I believe the number I’ve hard bandied about before was $47.
I promise you that even if you and I don’t know this number our company knows it. And they know what other companies in the industry’s total compensation is.
It’s all still irrelevant. They are paid what they are paid and the legacy costs are completely irrelevant when it comes to asking current workers to sacrifice.
Yep, and every single resource on my projects. As a project manager and accountant, it would be irresponsible of me not to. I can even break it down into salary, employer paid employment cost (taxes, insurance), facilities related cost (having a cube, a phone, heat, a computer). For ease, we generally use a blended rate rather than individual rates - but we can get the individual resource rates.
In the U.S. our total costs for an IT software developer is around $80. Here is the problem for the American worker - if I hire that person in India - its $25 and they have a Master’s degree. In China - its $8.
So, what should the companies do?
a) Welch on the agreed legacy costs they’re paying to retirees,
b) negotiate with current workers to reduce costs, or
c) go bust?
There’s a hidden d), of course - “get the lovely taxpayer to subsidise inefficient businesses in perpetuity.” How does that sound? And how does one ever reduce one’s legacy costs without negotiating with existing workers? How do benefits get defined in the first place, if not by negotiation?
I do wish we could stop describing human beings as “resources”, though (no offence, Dangerosa, just a pet peeve).
Dead Badger, tagos, you’re both wrong.
Dead Badger: Legacy costs are part of the cost of employing previous employees. They represent a liability which the company must pay which is independant of current employment levels, and in any company worth its salt should have been taken into account when setting salaries for those previous employees.
tagos: The compensation provided to the current employees includes their salary and the cost of providing any other benefits like company car, health benefits or future pensions, not just their fortnightly pay packet.
I know. I’m just opposed to the ideological sleight of hand going on demanding that current workers, whose salaries are not the deal breaker anyway, should sacrifice the pensions and benefits of previous generations or sacrifice for them. They’ve agreed a deal for 2011. And I notice the complete lack of any call for the layers of management actually responsible for this shit-storm to take responsibility. It’s just Repugs fighting the good class-war fight. We fuck up, you pay.
Oh please. There are provisions in the bill to limit executive compensation. Besides, it doesn’t matter if the Republicans have the evilest of intentions, their position is correct. Why should my tax dollars support some greedy overpaid person, whether that be a CEO making 25 million, or a janitor making 60k?
Eh? I’m well aware of this - hence my questioning whether it would be reasonable to simply abandon legacy commitments. However, when you’re dealing with large portions of such costs on a pay-as-you-go basis, it’s a labour-related running cost that has to be factored in. And yes, the only way to remedy the problem is to negotiate with existing workers. The alternatives are going bust or continuing as a taxpayer-funded basketcase in perpetuity, a reality which tagos seems quite insistent on ignoring. What else do you do?
Well certainly, great, we can all tut at the Big Three and roll our eyes at their incredible lack of forethought, but it doesn’t change the fact that those legacy costs exist, and are part of the reason the companies are circling the drain. Moreover, it’s impossible to fully predict future conditions, so setting such lagging costs at appropriate levels will always entail a large degree of risk. And while talk of “taking responsibility” may feel good, it’s notable that nobody has any serious suggestion as to what a company in as shitty a situation as GM might actually do to reduce costs other than negotiate with workers. If everyone above VP level worked for free, they’d still be fucked; maybe tagos would feel better about it all, but nothing significant would’ve changed.
Because that CEO got paid tens of millions a year for actively screwing up and won’t suffer in the slightest even if paid zilch (Which they won’t. you know as well as I that these people will keep their snouts in the cream, they’ll just relabel the bowl). The janitor, or in this case, the retired janitor are expected to pay.
And no - their position is not correct. The bail-out success is not dependent on the workers bending over the ex-workers and screwing them. It was just a minority of RePug senators aided and abetted by 1 Dem standing in the way of a deal that had the majority support of both Houses and the Bush regime.
And I still have no doubt that this was just a form of filibustering to ensure the 3 get their money without any executive bonus or environmental requirement strings.
This situation is a lovely little simulation of the US as a whole down the road, what with the national debt being as high as it is and going higher. Same thing that people say with all the spending the US does today - we are punishing our grandchildren with what we use today. Looks like the current UAW members are those “grandchildren”. Their “grandparents” took as much as they could, when they could and now someone else has to pay for it.
The requirement to match pay doesn’t have anything to do with the retirees. Besides, you didn’t answer my question. Why should my tax money go to support some greedy and overpaid janitor?
Getting labor cost parity with the foreign automakers is part, and returning common sense to the layoff structure are necessary parts of returning the Big 3 to competitiveness. I don’t see a path to profitability without that. If the UAW doesn’t want to do so, then as far as I am concerned the Big 3 can go bankrupt. That’s a better option than pumping 20 billion into the Big 3, and have them come back in a year with the same problems.
I thought the sticking point for the UAW was that they had to take a pay cut but the corporate exec’s making millions a year did not.
It’s going to support a bunch of fucking rich bastards who should, if the world was just, be crumpled bleeding forms in front of a high, pockmarked wall so why not.
You are effectively are asking UaW workers to sign up to lower than industry wages to bring that $70 down to the level of younger non-unionised factories with less incurred legacy costs.
Why the fuck should they when the deal has been agreed by all concerned except a minority of Senators and they have a cost-reduction agreement already in place?
Besides - it is not your tax dollars - it’s China’s and it’s all the other purchasers of US debt.
The real question is:
Why should a minority of Senators be allowed to derail an agreed package for ideological spite?
Mu answer is - it was a deliberate tactic to ensure the Big 3 got the money with no strings attached.
We are asking not asking them to bring the below industry we are at least asking them to lower their wages to what others pay. I have posted twice using Gonzo’s citation that UAW workers even when you take out legacy costs make more per hour then their non UAW counterparts. I don’t know why you have twiced ignored that part of my post in your attempt to make points.
If that were true, no one would be using that $72 dollar an hour figure. Many are using it.
Can you guess where the United States invests your social security?
So we shouldn’t give them money at all?
This is all in your imagination. All the amendment requires is that the wages+benefits of Big 3 workers match the wages+benefits at the foreign competition.
Because they aren’t doing it for ideological spite.
So you’ll continue to spout the line that labor is only 10% of the cost of manufacturing a vehicle?
Only because it is true and I have given you cites. You just want to keep believing it is not true. More blue collar bigotry.