Thread: Protesting in Wisconsin....Just the beginning?

I understand what you're saying, but why move to Mexico? Why not stay in the states and move to another state somewhere? When companies move, they move to a country where there are no labor laws, barely any regulations, etc. You don't see them moving to Canada, Germany, Sweden. Instead it's Mexico, Vietnam, Cambodia etc. It's just an excuse.

John

John, I agree with you. It is terrible when we move jobs out of the country where wages are so low the people making the product can't afford to buy the product they are making. My point is that excessive union demands (not all union demands) play a factor in companies leaving. As much trouble as GM was in two years ago, all the workers just received profit sharing checks. It would have been better if the money had been used to pay back the tax payers and strengthen the company. Another thing I don't understand is how the UAW took ownership of 30% of GM...Are they now negotiating with themselves...or is this a conflict of interests.

My problem is not with unions, it is with excessive union demands. I just retired from the Michigan Department of Corrections and was a member of a public union. Our union stewards spent 90% of the time protecting 5% of our members. These same 5% were constantly in trouble and were extremely hard to work with. This 5% was a drain on the other 95% and on the taxpayers. There were also several lawsuits filed by prisoners due to the actions some of this 5% that have resulted in well over $100, 000,00.00 to date. The taxpayers simply can't afford these types of things.

Our retirement system is based on the 3 highest years of pay. We had Corrections Officers who worked all the overtime they could get for 3 of their last 5 years. They were Corrections Officers who retired on annual pay over $100,000.00. One actually averaged around $125,000.00 per year and his retirement was based on this average. I would hope nobody would consider paying this pension over the next 30 years as fair to the tax payers.

I will most likely lose a large part of my pension over the next few because of budget cuts. This is the same thing that happened to my Dad when Detroit lost the steel industry. Financially I was better prepared than my Dad because I learned from his misfortune.

Back to Wisconsin...when unions bargain their contracts with politicians, they are bargaining with politicians. State politicians are basically temporary employees who rely on votes to keep their jobs. This in itself creates a conflict of interest for politicians who are hoping for union support to get re-elected. These same politicians are not dealing with a profit or loss margin and do not have the same vested interests in being financially intelligent as their private sector counterparts. This has created the time bomb we are facing today.

Should unions go away...definitely not. They create a safeguard that benefits most people from being taken advantage of by their employers.
Should factories moving away be stopped...definitely yes.
Has NAFTA benefitted America...definitely not. It has not even slowed down illegal immigration from countries that benefit by NAFTA.

I have enjoyed this posting. It is always good to hear well thought out and intelligent opinions and knowledge from others. I realize my opinions are not always right and I need to benefit from others who have knowledge, opinions and experiences that I lack. I hope I have not upset anyone by what I have said. I realize this is a very pointed subject that can turn ugly very fast. Personally, I have benefitted by reading and learning from the postings others have created.

You certainly have not upset me. I agree with what you say in many aspects. One thing I notice, and I don't mean from you, is that people always seem to complain with what the workers are making but seem to be oblivious to the bonuses the upper management people get in addition to their pay. Again, if it weren't for the assembly line workers or laborers these people wouldn't be making what they make. They are basically being paid off the sweat of the workers.

The reason for this in my opinion is that people feel that these people are easier to get to. They're their neighbors, their kids friends parents etc. The ultra rich and the politicians are so far removed from society that most people don't personally know any of them. Jealousy also plays a big part too. If we all just changed where we're looking and instead of looking at people who we feel are below us or on the same plain as the problem and looked upwards I think things could possibly start to change.

As for GM, I believe they've paid back the loan the the government with interest, which is more than what the banks have done or ever will do. The person who was in charge of the overseeing the bank bailout came right out during a congressional hearing and stated that we will be lucky if we get 80% of that money back from the banks. To show how much out of reality some politicians are, when they were questioning him they stated that they didn't think it fair that under the restructuring some of the bank management went from making over 3 million dollars a year to under 500K. Also, the bonuses they were getting weren't performance based (obviously), they were guaranteed. When it was brought up that the banks could go under unless they forego the bonuses, not one of them agreed to it. I don't recall them being too concerned about the concessions some workers had to make to keep companies going, while they were still giving out bonuses to top management. As a matter of fact, the UAW has agreed to pay new hires at a rate of half that of existing workers, around $14.00 per hour.

There is no doubt in my mind that companies that have been bailed out or have gone through tough times will be back to business as usual and not learn from past mistakes, which is unfortunate. Many of the banks that were "too big to fail" are even bigger now. One of the good things I've noticed from the automakers bailout is that more of the American automakers are making their cars here. I would hope that was part of the deal they had by taking government money.

For years the American Made Index by Car & Driver had more foreign automakers than American in the top ten. I think in 2007 there were five Toyotas and one Honda in the top ten. To qualify, at least 75% of the vehicle including all its components had to made here. Even BMW is building an SUV here, I think in NC.

Anyway, enough of my ranting. I've enjoyed reading the comments here. I think most of them have been civil and factual. Thanks.

John

Another comment in regards to NAFTA. That hasn't helped the average Mexican at all. Many of the farmers who have run family farms for generations have had to fold up and move to the cities to work. The reason being is that many of the agrigiant companies in the US have gone in and have been able to sell corn and other vegetables cheaper than the family farmer, who was living in poverty anyway. The massive influx to the cities for work has cut poor wages even more and has caused many of the families to cross the border looking for a better life for their children.

President Clinton recently commented that he regrets ever supporting the deal, particularly after seeing the devestation "free trade" agreements have caused in places like Haiti. The unions here AND in South Korea are opposed to the newest one we have with them. There are more in the works in the Latin American countries. I try to buy American as much as possible and if I can't I try to buy from a country where I know the workers are paid decently with good benefits, many better than here such as Canada, Germany etc. If not I try to look for Fair Trade items. Every bit helps...I hope!

John

The bottom line is we are part of the world economy and all things considered that means the world is in competition with each other and that also means things gravitate to the lowest common denominator. Poor countries eventually improve and rich ones go downhill. Yes we can specialize in highly technical types of manufacturing however say in 30 years or so when China and India really become world powers do you think with our population we can outproduce them in Scientists and highly educated people. Both are still second rate countries and we worry about them now.

Back during WWll the U.S brought POWs to the U.S to work on farms and in factories. Mostly Italians but some German's too. All low ranked enlisted types. One Italian who remained after the war wrote about his experiences. He told about his train trip from N.Y to the Mid west and seeing the population of the U.S and Factories that seemed to be miles long and huge cities and he realized the war was lost. There was no way the axis powers could ever produce war material in competition with the U.S and supply the manpower.

This is how we can look at China and India. Down the road we don't stand a chance unless some very big changes happen.

China is ahead of us in many aspects and continues to move ahead. Part of the reason is probably the fact that for many years we did look at them as nothing more than a second rate country. We've done so at our own peril. When I was growing up I doubt anyone ever thought China would be ahead of us in some technologies.

John

Originally Posted by kerryman71

China is ahead of us in many aspects and continues to move ahead. Part of the reason is probably the fact that for many years we did look at them as nothing more than a second rate country. We've done so at our own peril. When I was growing up I doubt anyone ever thought China would be ahead of us in some technologies.

John

Yeah, this and the fact that Middle Class America has been outsourced and as a result China has a burgeoning middle class and ours is shrinking at an alarming rate. Even 50 years or so ago, there were all kinds of factory jobs in America where even someone without much education could make a liveable wage. Not so now and probably never will be.

We've financed our own demise and probably deserve everything we get but I don't recall any votes as to whether we should invest heavily in a communist dictatorship with a pi$$ poor human rights record. It seems to have just sort of happened.

Yet we have an embargo on Cuba. Go figure.

The point you make about someone with minimal if any education at all being able to make a good living is excellent. My grandfather, most likely as well as many others grandparents here, finished ninth grade and that was it. I'm not suggesting we go back there, but he was able to work in a shop and retire with a pension.

A high school diploma is getting to be where it won't mean anything here. Unfortunately not everyone can afford to send their kids to college and will have to settle for that. We're going backwards here. I teach my kids as much as I can about life and tell them that some of the clothes they are wearing was probably unfortunately made by kids their age. They're 9,7 and 6 years old. If we keep going backwards we'll probably end up with child labor again.

Henry Ford, who hated unions, at least knew enough that you had to pay the workforce enough to buy the products they produced. There's a quote of his in regards to this. He says that when the day comes that they can't "we're cruising for a bruising".

John

Originally Posted by 1OldGI

Yeah, this and the fact that Middle Class America has been outsourced and as a result China has a burgeoning middle class and ours is shrinking at an alarming rate. Even 50 years or so ago, there were all kinds of factory jobs in America where even someone without much education could make a liveable wage. Not so now and probably never will be.

I think it is worth looking beyond the labels. There's pretty huge difference in standard of living between 'middle class' in USA and China or India.

The issue is that nowadays more and more people have to compete on a larger scale. It's now easy to ship manufacturing abroad, so the manufacturing jobs have to be competitive on a global scale.

I think the view that the manufacturing jobs is what US needs is completely misplaced and is just a mechanistic reflex. The 1950s and the 1960s are gone and are not coming back. The fact that the back then the economy was driven by industrial production doesn't mean that doing the same thing 50 years later will produce the same results. On the contrary, due to the huge technological innovations over half a century, sticking up with the old economic model means a guaranteed decline.

Ever since shortly before WW2 US has imported, by stealing or buying any innovation they could from europe and japan, which were the most developed places. After the dissolve of the iron curtain there was the additional transfer from that part as well. However that isn't going forever. Europe and Japan are certainly getting much better at retaining their brains and Russia and China are getting back at it as well.
The main advantage US still has in attracting innovation is the freer economy.

What does this mean?

You can do what several posts above propose and move toward protectionism and isolationism. Unfortunately this will at best delay the inevitable by say a couple of decades, may be one generation, and then US will be in much worse position to do anything.
Or you can keep the open economy and try to remain as competitive as you can on innovation. Eventually China and India are going to dominate, that's just inevitable, but that also requires an open market and may be when this happens the national borders will be fairly meaningless thing (e.g. at this time most people do not think of say New York and Texas economic rivals?).

However choosing the second path means that instead of trying to keep the jobs where even non-educated people could make a good living 50 years ago, you need to work on getting people capable of doing jobs that can provide good living not just now but hopefully 20 years from now. And it seems that all of these jobs require not just education degree, but the analytical skills that a education degree is supposed to correspond to.

Coming back to the original topic of this thread, the problem is that instead of addressing the serious long term problem the Wisconsin events are just one big political circus. The issue shouldn't be whether the teachers can bargain collectively or not (apparently that's perfectly fine for the police). Neither it is fiscal responsibility (after all the same governor gave away plenty of money to businesses).
The issue should be what kind of contracts are being signed (e.g. rewarding seniority instead of competence seems like a pretty good thing to change).
And secondly, the exact same argument that republicans make about the need of high 'compensation' for executives in order to attract and retain talent ought to be rethought for teachers who are basically in charge of ensuring the competitiveness of US in the next generation (may be nobody is making it because the best teachers aren't in it for the money, while the best executives are, but what if you change this and see what happens).

A couple of decades ago the Irish thought that higher education would mean a turnaround for their impoverished country, they did not concentrate on manufacturing, technology or job creation. Their greatest export was educated Irishmen. You have to have the manufacturing capacity, it is manufacturing a raw material into a finished product that creates wealth. Technology does not. Everything Silicon Valley comes up with is shipped overseas, where the uneducated produce it, creating the wealth.

BTW It was the Tariff Acts of the early 19th century that spawned the birth of American Industry. Protectionism works. Japan exports to us but accepts little from us and in doing so created the worlds 2nd largest economy at that time. Protectionism works. China exports everything they can to America, what do they buy from us? Nothing, and now they are the powerhouse. Protectionism works.