Tuesday, December 16, 2008

Why Are These GOP Senators Unhappy?

Why Are These GOP Senators Unhappy With Auto Aid?
Rescue Opponents Want More UAW Sacrifices

By Todd Spangler and Justin Hyde | 16 December 2008

WASHINGTON— Over the last decade, the UAW has spent more than $10 million to elect Democrats and defeat Republicans— some of them the same GOP senators now being asked to rescue the domestic auto industry. Those Republican senators, who may hold the key to getting the $14-billion lifeline to General Motors Corp. and Chrysler LLC passed through Congress, are clamoring for deeper union concessions as a condition of any kind of support.

Sens. Richard Shelby of Alabama, Bob Corker of Tennessee and Minority Leader Mitch McConnell of Kentucky represent states where foreign automakers have significant operations and the UAW has less sway than in Michigan or Ohio. Each also has been the target of considerable political support from the automakers' union flowing to Democrats who have opposed the senators in elections.

Complicating matters for the union— which has been lobbying hard for passage of the rescue plan— is that it threw its political weight behind many of the Democratic opponents who managed to beat Republican incumbents last month. Now those same defeated GOP senators are being asked to save the domestic auto industry from ruination before giving up their seats. In this year's elections, the UAW gave $40,000, for instance, to six Democrats who won seats currently occupied by Republicans.

On Wednesday, Shelby— who once was a Democrat but now leads the forces lining up against the automakers in the Senate— said the most recently unveiled legislation reveals "the influence of the UAW," as it calls for no specific cuts in health care benefits or wages. Corker, meanwhile, has demanded that the union accept wage cuts that put it on an even keel with nonunion plants in the South, a provision even the Bush administration didn't insist upon as a condition to passage.

"Here's the tension," Deputy White House Chief of Staff Joel Kaplan said Wednesday. "A lot of people would like us to write the concessions into the legislation: The unions must take exactly this pay cut. ... That's not something we believe that the Congress is best suited to do."

Foreign Automakers

Against that background is the fact that Shelby, Corker, McConnell and others represent states where foreign automakers have a presence. Alabama is home to plants for Mercedes-Benz, Honda, Hyundai and Toyota. Tennessee is getting a new Volkswagen plant and is home to Nissan's North American headquarters and other manufacturing facilities. Georgetown, Ky., in McConnell's home state, is the site of Toyota's biggest plant outside Japan.

Sen. George Voinovich, R-Ohio, a supporter of the auto industry rescue plan, said he's still waiting for specifics on what the legislation's critics are demanding. "I think it's antiunion. I think that's the motivation behind it," said Mike Kennedy, 44, of Warren, a member of UAW Local 961 who works at Chrysler's Detroit Axle plant on Lynch Road. "They want us to file for bankruptcy so they can walk away from their obligations."

Kennedy said he's hearing a lot of anger toward Southern senators among rank-and-file members, likening it to a civil war ready to break out again, North against South. Messages left with some of the GOP senators' offices asking if campaign contributions played any role in their decision-making were not returned Wednesday.

Support For The Union

On the other side of the aisle, many Democrats said the union already has made more than its share of concessions— on wages, health care and more— during recent contract negotiations. Also, the UAW has signaled it would be willing to suspend its controversial jobs bank, which allows laid-off workers to continue to receive nearly full pay for up to two years.

The union also has argued vigorously that once you drop legacy costs to fund health care and pensions for retirees from the equation, line workers don't make much more than their counterparts at the foreign automakers' U.S. plants. In a best-case scenario, Ford Motor Co. presented information to Congress last week saying there was only a $4-per-hour difference between workers at Detroit Three plants and those operated in the United States by foreign-based companies.

Rep. Barney Frank, D-Mass., who chairs the House Financial Services Committee, said there appeared to be a double standard on the part of Republicans focusing on autoworkers' pay, when they voiced no similar concerns about employee wages or benefits before approving a $700-billion bailout for the financial industry.

"The average worker at AIG makes far more money than an autoworker. The average worker at Citigroup ... makes more than an autoworker," Frank said Wednesday. "Does anybody remember Citigroup being told that as a condition of its money, they have to get no more than a community banker gets?"

[ Normxxx Here:  And the banks, recipients of several hundred $billions directly and several $TRillions indirectly are reluctant to make any new loans to the automakers to "tide them over." Moreover, they are just as reluctant to make new loans to prospective car buyers.  ]



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