Bailing Out the Auto Industry is a Horrible Idea

I’m going to ask one simple question — what incentive do the Detroit Three have to become more efficient, if we show them that we’ll pay for their losses? 

The Auto Industry Financing and Restructuring Act, if it hadn’t been shot down by the Senate, would have put in place a presidential designee, who would have the power to tell the car companies they must produce “a product mix and cost structure that is competitive in the United States market”.  The remove the doublespeak, there would be a government entity that could tell the car companies what cars to make, and how much they can be sold for.  We’ve socialized banks, and now the government wants to socialize the bloated auto industry.  Fantastic.

According to GM, the average factory worker makes $29.78 per hour, plus benefits, and Democrats say “I think they [the UAW] have made plenty of concessions” (McCaskill, D-MO).  Really?  Let’s tally up what the UAW has conceded:  They offered to delay (that’s delay, not discontinue) company payments into a union-run trust fund that will take over retiree health care costs starting in 2010.  They agreed to end the controversial “jobs bank” program in which laid-off workers get most of their pay and benefits after unemployment pay runs out (translation: a program where people who aren’t working are still getting paid — this is how much extra money the UAW has laying around!).

The Detroit Three are going bankrupt because they can’t make cars cheaply enough, or sell them expensively enough to make a profit.  Those UAW workers that make $29.78 per hour…that comes out to almost $60,000 per year.  I don’t make that much with my college education!!  Guess what, folks — you’re overpaid!!  But that’s right, they’ve made enough concessions.  They shouldn’t take a pay cut from their $60,000 a year jobs. 

Fine, UAW, you don’t want to be part of the solution?  What kind of wage are you expecting from a company that goes bankrupt?  If the car company dies, your job goes away, so it might be in your best interest to, oh I don’t know, lift your little finger to help.

Sen. Kent Conrad (D-ND) told CNSNews.com he does not believe it is the government’s role to tell companies what they must pay their employees.  Really?  It’s not the government’s role to tell companies how to do business, but it IS the role of government to float private enterprise a loan that will never be repayed, when private enterprise fails to be competitive?  I’m confused about which government interventions into private enterprise are okay, and which aren’t.  Can you clarify it for me, Senator Conrad?  Or is it really that several Democrats are so obviously bought by the UAW that they might as well be on the payroll?  If you really believe that the government shouldn’t tell companies what to pay their employees, Senator Conrad, would you support abolishing the federal minimum wage??  I’ll bet my next paycheck that you wouldn’t.  If you really believe that free enterprise should be free, then why do you support spending taxpayer money to cover the losses of those enterprises??

Unions had an important role in protecting workers.  They lobbied for the 40-hour work-week, minimum wages, workplace safety standards, and fair treatment, all in their time.  Nowadays, however, unions play an important role in strongarming employers into contracts that are so bloated that the companies can’t afford to stay in business.  Yeah, that’s a great long-term strategy — price yourselves right out of a job, then refuse to bend when the company can’t afford you anymore. 

Let the companies go into bankruptcy.  Let the workers lose their jobs.  Let the UAW run out of money, then maybe they’ll understand the err of their ways.  The problem is that won’t happen.  One way or another, the federal government is going to float the auto industry. 

So my only remaining question is this: when do I get a fat check from the government, or am I just a revenue source meant for bailing out ineffective companies?

I’m disgusted.

^Z