The Pinball Bailout?

November 17, 2008 | Filed Under Budget, Business, Congress, Democrats/Leftists, Economy/Finances, Government, Corruption, John Armor, News, Publius Contributor, Security/Safety, Society/Culture, Taxes, The Law |

-By John Armor

Is the proposed bailout of the “big three” auto makers really for them? Or is it something else entirely?

Here I sit in a farmhouse on the Eastern Continental Divide. From my front porch, I can see most of upstate South Carolina. In that territory are several auto manufacturing plants that are doing just fine, thank-you-very-much. To my left, or west, is the Tennessee border. Over those mountains are several more auto plants which are quite healthy, also.

So, let’s chuck in the trash the idea that auto manufacturing in the US is failing generally. It isn’t. It is just the “big three” American manufacturers. Properly, it should be called the “big two and a half,” since Chrysler is in the bucket, once again.

Auto manufacturers must be in the business of not only manufacturing cars, but selling them. So, let’s’s start at the end and work backwards to a realistic starting point. Let’s say that next year General Motors will have a demand (both foreign and domestic) for one million cars and trucks. That means, regardless of corporate or governmental actions, it will need enough employees to manufacture one million cars.

Employees above that need are going to lose their jobs, no matter what the government, or corporate management, or auto unions do. That is, unless the government goes into the business of buying up stockpiling unsold cars, like it does for certain farm products. I begin with the assumption that the feds are not so stupid as to start dumping excess cars in silos in South Succotash, Iowa.

It follows, then, that enough GM employees to manufacture one million cars and trucks, will get to stay on the job in GM plants, doing that work, REGARDLESS of whether the feds bail out GM, or do nothing and GM has to file for bankruptcy.

In bankruptcy, GM would be rid of its present, clearly incompetent management. It would also be free of the tentacles of the United Auto Workers. If anyone is paying attention, the healthy auto plants in states other than Michigan, are generally non-union and in a welcoming environment for businesses generally.

There’s also the wrinkle that the unions operate a worker retirement and welfare plan which is owed a $7 billion payment early next year. If US auto companies get bailed out, that payment gets made. If not, then not. And don’t forget that only union contract employees pay union dues.

Bottom line, this is not a proposed bailout for the American auto industry. It is really a bailout for the auto unions. And, as the pinball bounces, it is also a bailout for a failed Democrat city (Detroit) and a failed Democrat state (Michigan).

This fits right in with the proposed federal law to end secret ballots in union elections. Except in the public sector, unions have been in a steady decline in membership for more than forty years. Terminating secret ballots in union elections will have only one result: more unions will be recognized in more places if union organizers can lean on employees personally and directly, to force their “votes” to go in the right direction.

This, by the way, is not a new concept. The secret or “Australian” ballot was not introduced in the US until 1888 in Louisville, Kentucky. Prior to that, the political parties printed their own ballots for every election, and urged their supporters to use them. The advantage was that party organizers could tell by the color or shape of the paper ballots whether each voter was voting the right way, or with the hated opposition.

What does it matter that the bailout is really for the unions, and for two, failed Democrat administrations? In the long run, this bailout is designed to save the Democrat Party itself. If the incoming administration is an abject failure, it will take hundreds of millions of dollars, and hundreds of thousands of warm bodies, to pull its chestnuts out of the fire in 2010, and especially in 2012.

Where are those bodies and that money coming from? Majority Leader Harry Reid has a plan for that. Watch the Senate on Monday afternoon as he fires the first shot in the pinball bailout.
____________
John Armor is a graduate of Yale, and Maryland Law School, and has 33 years practice at law in the US Supreme Court. Mr. Armor has authored seven books and over 750 articles. Armor happily lives on a mountaintop in the Blue Ridge. He can be reached at: John_Armor@aya.yale.edu

Fair Use: This site may contain copyrighted material the use of which has not always been specifically authorized by the copyright owner. I am making such material available in my efforts to advance understanding of political, human rights, economic, democracy, and social justice issues, etc. I believe this constitutes a ‘fair use’ of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for research, educational, or satirical purposes. If you wish to use copyrighted material from this site/blog for purposes of your own that go beyond ‘fair use’, you must obtain permission from the copyright owner.

Bookmark this story to your favorite service: