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When the corporate media start to chastise corporate executives, it should make you suspicious. A good example of this is the not so mainstream media's war of words against the automotive bailout. The same media outlets that pushed a $700 billion bailout for banks and brokerage firms have been pushing just as hard against a much, much smaller automotive industry rescue.

They are up to something.

Some rightist pundits have openly expressed the real agenda behind efforts to block the bailout. In "Auto Bailout Aimed at Unions, Not Companies" on TheStreet.com (11/18/08), Debra Borchardt overtly spelled part of out the real agenda. Often, you need to read business news to find out what the corporations are really doing.

The bill circulating in the House of Representatives would allow the automakers to continue making payments to the trust fund established to fund obligations for retiree health benefits.

The automakers established the Voluntary Employee Beneficiary Association in 2007 to get the health plan funding off their books. VEBAs, a popular tool for distressed companies, also help protect retirees' benefits in case the companies go bankrupt, according to Voluntary.com. Obviously both the automakers and the union saw the writing on the wall last year and began making strategic moves to prepare for it.

The only problem is that the automakers ran out of cash to keep feeding the beast. Starting in July, the companies began requesting payment deferrals. The UAW granted the request, but the union is getting antsy for its money.

No healthcare for those damned middle class retirees. Only the rich should get that. What is Congress thinking?

Kathleen Pender got down and dirty in the San Francisco Chronicle 11/20/08, arguing in favor of bankruptcy filings for automakers. If you keep scrolling down a while, you find the dirt.
Many employees lose their jobs. The businesses that go into Chapter 11 on average come out with about half the workers they had before they started downsizing, LoPucki says. "The employment loss is not caused by bankruptcy. Bankruptcy is simply the recognition that you needed to shrink the business."

In bankruptcy, unions are forced to renegotiate contracts. Members of the United Auto Workers have benefits that far exceed what most Americans have, including generous retiree health plans and pay for time they are furloughed. Those would undoubtedly shrink in bankruptcy.

In other words, the corporate media want to take benefits from retirees and to make unions give up wages and benefits for people who still have jobs. This isn't just about autoworkers. Good union jobs put upward pressure on wages and benefits throughout the economy. This is an effort to redistribute wealth from the middle class to the rich in the long term, taking advantage of a crisis in the short term.

The crack about "benefits that far exceed what most Americans have" is particularly interesting. It is an appeal to envy and resentment, when collective political action and solidarity actually can help all the middle class and poor people being screwed.

Shock Doctrine anyone?

 

3 comments

  1. Christopher Says:
  2. Yes, yes, yes!

    I've read so many liberal bloggers cheer the possible destruction of the U.S. automakers.

    I don't get it. They hate SUVs so they want American workers to suffer as if the American worker decided to make SUVs. This was a management decision.

    I saw an African American woman (a single mother of two) on CNN a month ago who told of being deserted by her husband and she was forced to go on welfare. A job at GM came open and she took it, getting off welfare and even buying a modest house in Detroit.

    She said if her GM job disappears, she will very possibly end up back on welfare because the jobs market is so bad in her area. She is the face of the Big Three.

    If we bailed out Wall Street, we had better the fuck bailout Detroit too.

     
  3. libhom Says:
  4. Christopher: I hate SUVs and want as much as they do, but I think there is a more rational and productive approach. Automaker bailouts can have strings attached forcing better fuel efficiency. Thanks for getting it on the class warfare implications of the media's efforts to block the bailout.

     
  5. Pagan Sphinx Says:
  6. Listen, I want to support the auto industry for the sake of the workers and the unions that allow them to make damn good money. They deserve it. But we all deserve it. I've been a "public servant" my entire life, making pennies working for non-profits and the public school system. You have to admit they make a very, very good wage compared to most Americans these days.

    Both my parents worked in sweat shops. My mother for a electrical wiring company sticking dog only knows what into a hot oven. My father was a union welder. He did pretty well but his union was constantly on strike and he did not earn nearly the money that his counterparts of the time in the auto factories did.

    I'm conflicted on this but I do want to err on the side of caution for issues I care about and so I side with the bailout loan to the Giant 3. But I'm not thrilled about it. 60-something % of Americans appose this bailout. It's very unpopular and it's not hard to see why. I am royally pissed at the fecking auto companies! There better damn well be some changes. Some real changes, not just symbolic ones like trading jets with hybrid cars.

     

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