The Detroit auto makers find themselves in economic trouble not only because they gauged the market for SUVs incorrectly, but also because they went along – too long! – with the demands made by the United Auto Workers.
Detroit auto workers are paid far more than auto workers for Toyota and Nissan. In addition, the corporate costs for the pensions and medical care for Detroit auto workers have put the Big Three farther down the road to insolvency.
Knowing the deleterious results of capitulating to union demands has not prevented other unions from making ruinous demands at a time when not only the auto industry, but also the entire country is precariously poised to face greater economic troubles than it is currently enduring.
In Chattanooga, Tennessee, for example, union leaders are demanding that hourly wages paid by Volkswagen be increased by 25%. Company officials say that the wage increases may result in a loss of jobs, the delay or cancellation of a new factory, and a diminution of tax revenues for the city and state.
The demand for increased wages has come from the Plumbers and Steamfitters leadership in Washington. D.C.
It is time for unions to contribute to the goals of a full economic recovery and not be a roadblock to national prosperity.
