The Downward Spiral
Mar 31st, 2006 at 11:29 pm by Susie
You know what? Maybe there’s legitimate cause for this specific company to do this. But tactical bankruptcies have also become just one more trick in the management toolbox, and I’m tired of reading about rocketing corporate profits that lead to workers getting kicked in the teeth:
DETROIT, March 31 — Delphi, the nation’s biggest auto parts maker, on Friday asked a federal judge for permission to throw out some of its labor agreements, a move that could cost 20,000 union workers their jobs and leave thousands of others with less than half their current wages.
Delphi, which is operating in bankruptcy, wants the judge’s permission to impose sharply lower wages and benefits on six unions, setting up a confrontation that its largest union, the United Automobile Workers, said could lead to a lengthy strike.
A strike could also cripple General Motors, which spun off Delphi in 1999 and remains its biggest customer. And any harm to G.M. could eviscerate the U.A.W.’s own influence as one of the nation’s most socially progressive and powerful unions, while accelerating the slide of the American auto industry.
Delphi said it would close or sell all but 8 of its 29 plants in the United States and cut 28,500 positions around the world. Beyond the 20,000 of its 33,100 hourly jobs in the United States that Delphi plans to cut, another 8,500 salaried jobs worldwide are to be eliminated.
“I took this job thinking this was my future,” said Tracey Huffman, 37, staring blankly down at a table at Jamins, a pool hall next to the U.A.W. Local 651 hall on the east side of Flint, Mich. “Now I don’t know. It’s like starting all over again.”
Ms. Huffman, who is scheduled to be laid off temporarily at the end of April, now fears that her layoff could become permanent. Any decision by the judge, however, is expected to be weeks or even months away.
The confrontation promises to become even more fierce in coming months, as G.M. tries to extricate itself from its worst financial crisis in over a decade, and the U.A.W. fights Delphi over the deep wage cuts that it wants to impose.
All sides could be losers. A strike by the U.A.W. could send G.M. into bankruptcy alongside its former parts unit, a fate that would be an even bigger debacle for the union and the industry than Delphi’s bankruptcy has proved to be.
And unless a judge rejects Delphi’s effort to abrogate its contract, the U.A.W. faces the prospect that it can no longer give its workers the security it has fought for years to provide, leaving the union’s president, Ron Gettelfinger, distressed.
I guarantee you at least one talking head on the Sunday shows will bring up our booming economy, and wonder aloud at the stubborness of the general public which refuses to acknowledge the economic miracle that is the Bush era.
Because in Georgetown, things look great - except for the people expecting indictments. But I’m sure their stock portfolios are doing just fine.
Obviously, those inside the washington beltway don’t have to deal with the results of the ‘economic miracle’.
When was the last time they had to really work for a living? Yea, I know it was rhetorical.
@#$% ‘em.
the revolution will come and pass them by and they will wonder why it happened.
Thank you, Susie, thank you for bringing this up. It seems that much of the “reality based” community is too in a twist about whether Bush should be censured to notice this assault on more than 20,000 workers, not to mention the UAW, not to mention the entire labor movement in America.
It is a booming economy for Bush’s true base - the top 0.1% bracket. Corporate profits have doubled under Bush, inflation adjusted wages have stayed flat or declined. Break out the champagne.
It wasn’t unexpected. I think GM will be next. Still, I worked at Harrison Radiator just outside Dayton, OH for a time before GM spun it off into Delphi. They shut down a downtown factory and moved everyone south to this suburban industrial facility, a former Frigidaire plant with portions built pre-WWII. Like so many things we move from sprawl to burnout and abandonment. Most of the workers were near retirement when I was there, but what about their pensions, and will the a/c compressor manufacturing move out of the country? I’m more interested in what Delphi and the city will do with a suddenly-vacant building with over 1 million square feet under one roof, and some serious environmental cleanup issues to address — what the heck do you do with something like that? And this is just one of 21 plants being shut down.
GM is opening up a new factory in Mexico, are you suprised?