Tag Archives: Unions

Goodyear: Bad Policy

Posted on September 22, 2009 | Leave a comment

The United Steelworkers Union won one the other day. In the deal, the Union was able to win a number of concession from Goodyear:

  1. Minimum staffing levels
  2. Prevention of shifting production to any facility not represented by the Steelworkers Union
  3. $600 million in updates to the plants to keep them modern
  4. Wage and benefit increases
  5. Continuation of cost of living increases.
  6. A plant in Tennessee that was closed will have it’s employees to receive a buy out

So lemme get this straight.  Companies across the country, world in fact, are trying to cut back to minimize the impact of the global recession [which has most certainly ended by the way].  We are seeing staff reductions, we are seeing wage freezes and even in some cases wage roll backs.  All of this in order to keep companies from having to close.  But Goodyear?  What are they doing?  Why, of course, they are promising that they will keep a minimum number of workers on the job; not a maximum.  They are promising that they won’t move work to any plant not in America represented by the SWA.  Yeah, did ya notice that?  The Union didn’t say that they couldn’t move the jobs out of city or out-of-state or country, they simply said that the couldn’t move them where the union didn’t have representation.  So, if Goodyear wanted, they couldn’t move the plant to a Right to Work State and avoid a represented racket work force.  Nice.

Further, the Union was able to provide raises on top of cost of living increases to its membership.  All the while forcing Goodyear to spend $600 million in the plants so that they would be anchored to this ship wreck for the next several years.  Awesome.  Simply awesome.

Meanwhile,the only mention of why  these plants are in need of protection comes when the article mentions:

The Tennessee factory has been severely hurt by the economic downturn and an influx of cheap tires from China

Let’s ignore the fact that all of the tire buying American’s enjoy the “cheap tires from China.”  We like to have things provided to us at a price that is less expensive than we could otherwise find in the market.  So, while the American tire makers may see a decline in their sales, or at least in their profits, the rest of America see more money in their pockets.  This could be anyone from the single mother trying to make it to work to the florist that has to rely on tires to deliver her flowers on time.  All of this means added productivity.

Allocation of scare resources with multiple uses.

What we have now is an artificial allocation.  Or, people spending money on things that they wouldn’t otherwise spend that money on.  Which is almost always not optimal.  And somehow the press and the world rejoices at the fact that some Union jobs are saved at the expense of jobs elsewhere in the economy.  Jobs that have long ago ceased to be meaningful means of employment here in the US.  Here, you see, we are known for innovation and for services.  We need to free resources from the manual labor of tire making in order to free those minds to invent new kinds of tires.  Or news kinds of rubber.  Or any other of a long list of things yet to be invented but now prevented from being discovered.  All because of a racket.

But how, may you ask, can Goodyear continue to survive in this system where it is forced to pay fees and services to a work force that isn’t worth those fees and services?  Because, Mr. Obama has allowed Goodyear to charge an extra 35% for its tires adding directly to that companies bottom line.

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Posted in Economy, Politics: North Carolina

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Why Would We Tax Chinese Tires?

Posted on September 12, 2009 | Leave a comment

When American’s are really struggling right now to make ends meet, why would the United States impose a tax on tires being shipped to the country?  I mean, if we are really trying to give our consumers the opportunity to save and spend money, why, why would we tax something that they need?

“China strongly condemns this grave act of trade protectionism by the U.S.,” the spokesman for China’s Ministry of Commerce, Yao Jian, said in a statement issued on the Ministry website (www.mofcom.gov.cn) Saturday.

“This step not only violates the rules of the World Trade Organization, it is also contrary to the relevant commitments that the United States government made at the G20 financial summit.”

I am having a hard time understanding why we would impose trade restrictions that would endanger our relationship with China; one of our largest trading partners.

I should re-read this thing–be right back.

Oh, I see now:

The United Steelworkers union, which represents workers at many U.S. tire production plants, filed a petition earlier this year asking for the protection.

It said a tripling of tire imports from China to about 46 million in 2008 from about 15 million in 2004 had cost more than 5,000 U.S. tire worker jobs.

Forget I asked.  These are not the droids you are looking for.

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Posted in Economics, Politics: International

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Union Mentality

Posted on August 11, 2009 | Leave a comment

This from WRAL.com:

Although it is still unclear how many teaching positions could be cut because of the state’s long-awaited budget, educators are just now learning that their salary for the upcoming school year will be the same as last year.

How is that possible?

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Posted in Economics, Education, Politics: North Carolina

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Strange Numbers

Posted on July 6, 2009 | Leave a comment

This past Thursday, workers at a Smithfield Foods went to work covered by a Union contract.  And from all accounts, they are very very happy to finally be so covered.   For example, the article mentions as benefits:

  • Guaranteed sick leave
  • Time-and-a-half holiday pay
  • $1.50 an hour raise over the next four years

“We really did accomplish something with this union,” said Mattie Fulcher.  “We might not have gotten the raise that we wanted, but that will come in time. This is our first contract, and it is a start.”

Now, it’s hard to gauge “success” of this contract for the members.  Among the most glaring omissions of the article are the pre-contract benefits.  For example, what have the pay increases for the average worker been for the past 4 years?  Or, what was the pay multiplier for holidays and overtime before the Union came in to “save the day”?  We do get an idea of what pre-contract life might have been in respect to sick leave:

Fulcher said that on Thursday she got a 40-cent-per-hour raise…and she began earning sick time for the first time since going to work for Smithfield. The sick time is unpaid, but in the past workers earned disciplinary points that could lead to firing if they stayed home sick.

Okay, so lemme get this straight.  The new Union contract says that Ms Fulcher is able to begin to accumulate sick time.  Sick time that is unpaid.  And this is different than in the past when the worker was afforded unpaid sick time but could, if abused, be fired for taking too much sick time?  Now, the article doesn’t mention this specifically, it does point out that employees were given “discipline points”; whatever that means.  Look, I work in corporate America and my sick leave policy is pretty straight forward and generous.  If you are sick, stay home.  As often as you are sick.  And guess what?  few of us ever really call in sick.  But when we do, our bosses mark it down and track us.  Cause, ya know, far be it from an employee to take every other Friday off and claim to be sick.  Sheesh.

Next on the hit list, guaranteed hours:

The contract will also guarantee workers at least 30 hours of work each week…

Awesome.  Really awesome for peope who wanna work more than 29 hours a week.  Really REALLY bad for folks who don’t.  Cause guess what?  Those people get fired.  No company in their right mind is going to pay someone 30 hours of pay for 15 hours of work.  Nice.

And the last piece of good news:

Union members will begin paying dues of about $7 a week…

So, Ms Fulcher gets a $0.40 per hour raise AND gets to pay $7 bucks a week.  Let’s say, just for fun, that she works 40 hours a week.  40 hours at $0.40 is $16.  Assume a 15% tax burden and that 16 bucks goes to $13.60.  Of which $7 goes to the Union.  In the end, she gets $6.60 a week, or about $26.40 a month.  The Union’s take?  7 bucks.  7 bucks or $28 a month.  Guess who makes out better here?  The worker or the Union?  In this specific case, even considering that Ms. Fulcher kept her job, the Union made more money than she did.  But let’s not forget the folks that lost their job as a result of this.  In the end, they have lost the most.

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Posted in Economy, Politics: North Carolina

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Not the End, but The Beginning of Worse

Posted on June 26, 2009 | Leave a comment

I was reading the News and Observer this morning and saw that Smithfield Packing finally succumbed to the kudzu that is Unions.

Smithfield Packing, union agree on NC contract

TAR HEEL, N.C. — Smithfield Packing Co. and a union that worked for years to organize a huge North Carolina slaughterhouse say they have agreed on their first contract for the plant.

I have not yet taken the time to check and see if Smithfield Packing is a publicly traded company or not, but I am sure that the value of this company just took a 10% hit.  Not only that, but employment in the company went down today as well.

I repeat, there is nothing, not ONE thing that is good about unionization within a company.  Unless, of course, you are a Union official.

Unions effectively tax …  [company] investments by negotiating higher wages for their members, thus lowering profits. Unionized companies respond to this union tax by reducing investment. Less investment makes unionized companies less competitive.

And a less competetive company is a company that is not as valuable as a more competitive compant.  If you need further proof that Unionization is a bad thing, take a look at the States with the highest unemployment rates and see how many of them are Union states and how many are right to work.

Heck, I’ll save ya the time:

1 Nebraska Right to Work
2 North Dakota Right to Work
3 South Dakota Right to Work
4 Wyoming Right to Work
5 Utah Right to Work
6 Iowa Right to Work
7 Montana Forced Union
8 Oklahoma Right to Work
9 New Hampshire Forced Union
10 New Mexico Forced Union
41 Kentucky Forced Union
42 DC Forced Union
43 Tennessee Right to Work
44 Ohio Forced Union
45 North Carolina Right to Work
46 Nevada Right to Work
47 California Forced Union
48 South Carolina Right to Work
49 Oregon Forced Union
50 Michigan Forced Union

Interesting list, huh?

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Posted in Economy, Politics: North Carolina

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Teacher’s Unions

Posted on June 5, 2009 | 1 comment

I know that we don’t have teacher’s unions in Carolina, but still, the negative effects are everywhere.

Today, the N&O reported on the idea of merit pay for teachers.  In this case, the merit pay seemed to be limited to the type of school a teacher taught at; not how well that teacher did.  But still,  it’s a start.

I started my working career as a teacher, it was the first job I had after college.  Further, that first year was also a “negotiation” year for the “EA” and the school.  I remember the feeling when I saw the results of my elected representation:

No raises for teachers going from 0-1, 1-2 or 2-3 years of experience.  However, raises for everyone else.

I knew then that the whole “working for a union thang” wasn’t for me.  I left as soon as the year was up.

What I don’t understand is how so many people, with a straight face, claim that paying more money to a better performer is bad. Ffor anything.  Really.  Never ever understood that.  Ya know, while I think that the salaries we pay athletes is gross, at least we have the right incentives in place.

  1. We agree on a specific number of years in the contract.
  2. I will pay you according to the market.
  3. When you are no longer able to perform, you are no longer able to be employed.

Why would it be any different for teachers?  Why, WHY, do we want to protect low performing teachers?

I just don’t get it.

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Posted in Education, Politics: North Carolina

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The Damage Done by Unions

Posted on May 30, 2009 | Leave a comment

I have long felt that Unions in America are not only hurting the companies, but they hurt the workers too.  In short, Unions are damaging to the economy as a whole.The current exhibit in this long list of such exhibits?  The bond market.

Reuters reported last week that the bond market has turned.  What once was a very well understood relation between companies, unions and bond holders has suddenly been turned upside down.  Or, if not upside down, it’s at least been turned to the point that no one knows which way is up.  See, the point of buying a bond is that the bond is considered “secure”.  This term, in legalize, is meant to convey certain rights in the event of bankruptcy.  As it is now being played out, this right is being denied, or attempted to be denied to the bond holders of the auto makers; Chrysler and GM.

See, Mr. Obama is trying to put the bond holders behind other, more politically advantageous groups, in this case, the Unions.

…the Obama administration is offering most of the recovery value of those companies to “a favored political class, in this case the United Auto Workers…

What does this mean?  It means that people buying bonds are no longer going to do so with the secure knowledge that they are going to “get theirs” in the event the company has to declare.  And, you may ask, what does THAT mean?  It means, for companies with bargained for employees, that they are going to have a harder time selling their bonds and raising the money they need to conduct business.  And that, my friends, is BAD for business.

The whole concept is a strange one.  Politically attractive, sure, but strange.  See, on one hand, almost ALL of America is upset right now with “investors”, “speculators” and other groups of people that might have been making money when the banking crisis hit.  Most people feel that somehow it wasn’t the individual home buyers or the government that caused this problem, but that it was the folks trying to make money by floating that money.  So, Obama has a huge lever in the court of public opinion.

Then, of course, those bondholders are not united or organized.  While they may trend to act as a group, there is not formal organization and certainly they don’t have “members”.  So, by helpin the unions out, you have helkped out a very organized outfit complete with mind numbing numbers of people who just wait to be told what to do.

The other area that this is so concerning is that we seem to have people who actually believe that money just flows.  From somewhere.  Just waiting to be picked up.  And that if I don’t have enough of it, well then, by gawd, someone must have my share of it.  So I am going to go take it back.  Sigh.  I get so tired of that mentality, so so tired.

However, in the end, I really think that it is this movement toward the support of the Union that is going to be the largest threat to NC.  I just wonder if anyone else sees it.

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Posted in Economy, Politics: North Carolina

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Why We Have to Fight the Unions

Posted on April 23, 2009 | 1 comment

Certainly this last election was troubling for me here in Carolina.  We saw all the obvious, no need to rehash that here and now.  However, upon further reflection, I am perhaps most troubled by the increased influence of the labor movement here in North Carolina.  As a transplant, my history of struggles between the state and the unions is incomplete, but I understand that it has been brutal at times and even bloody.

Be that as it may, the impact of labor unions on the economic health of a state is dramatic and obvious.  And as the economic health goes, so goes the health of that state in general.  This includes the ability to create jobs, to keep those jobs, to balancing the budget and creating an environment that allows general and overall growth of that state.

This afternoon I came across this entry from Carpe Diem.  In it, Perry is showing that the highest ranking states in the “Economic Outlook Rankings” are almost all Right to Work states while the lowest are not.  Further, the net migration numbers are showing that people are leaving those Union Friendly states in droves.  And where are they moving to?  You got, Right to Work states.

But this is not news, it is just demonstrating what we really, already know.  That unions destroy economic progress.  And people, knowingly or not, vote with their feet and simply leave.  And typically, those that CAN leave are the ones that DO leave resulting in a continued downward spiral.  For example, see California:

California, which once lured Americans from near and far, is now driving out millions of the most productive residents – including high percentages of the most affluent.

“When California faced a Mount Everest-sized $14 billion deficit in 2003, one of the major causes for the red ink was the stampede of millionaire households from the state,” says a report called “Rich States, Poor States” by economists Arthur Laffer and Stephen Moore. “Out of the 25,000 or so seven-figure-income families, more than 5,000 left in the early 2000s, and the loss of their tax payments accounted for about half the budget hole.”

So this is what has me concerned about this past year’s election; the increased influence of the labor movement.  And here is why:

Big Labor’s Top Ten Special Privileges

1.  Exemption from prosecution for union violence.
2.  Exemption from anti-monopoly laws.
3.  Power to force employees to accept unwanted union representation.
4.  Power to collect forced union dues.
5.  Unlimited, undisclosed electioneering.
6.  Ability to strong-arm employers into negotiations.
7.  Right to trespass on an employer’s private property.
8.  Ability of strikers to keep jobs despite refusing to work.
9.  Union-only cartels on construction projects.
10. Government funding of forced unionism.

Just take a look at this list.  While I always have had a good healthy distrust and dislike for Unions, I have never seen it laid out bare like this.  Not ONE of these things even passes the basic sniff test.  Now don’t get me wrong, I fully support the right of worker or workers to “unite” in their common goal to approach management and offer a bargaining position.  What I do not support, is this legal mandate that exists that offers this kind of protection to a single organization.

And this is what scares me.

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Posted in Economy, Politics: North Carolina

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Government Employees: The Important Ones

Posted on January 13, 2009 | Leave a comment

So, this week the State’s Chiefs of Police are meeting in Durham.  They are here to discuss, among other things, how to attract and retain police officers.  I imagine that this is a dilemma that is not unique to police forces.  If asked, I am sure that Fire Chiefs would also list this problem at or near the top of their priority list.  So too would nearly every government agency.  And to make matters worse, we have elected or government appointed people running the show; this alone would cause me to hit the door.

As I was considering this today, I came across this awesome thought from TJIC.  While I have  never been able to express it quite this way, I have always thought that government always seem to lose their best due to circumstances like this.  Exposing your employees to competitive forces does not hurt the staff but rather increases the strength of the organization.  And, by the way, why would we want to protect our worst staff in this case?  I would seem that the top job of any supervisor to identify and remove the bottom 10% of the force?

Another way:  When you have an organization that only protects those who are not the top performers you should not be surprised when only the “not top performers” remain.

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Posted in Politics: North Carolina

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