"What's Good For General Motors Is Good For The Country"

General Motors Corporation was once the largest corporation in the United States. It was also at one time the largest employer in the world. GM has been in existence since 1908 and is an American tradition. Now it is fighting for its life.

In 1980, the year I was born, GM sold 50% of the automobiles in this country. As of the 3rd quarter of 2008 that figure has plummetted to around 20%, falling 45% just the past year. Rising fuel costs, tightening credit, the auto unions, and foreign competition has lead to this downfall.

At this time the biggest problem, besides shrinking sales, is the huge overhead that plagues GM. Alot of this overhead has to do with the employee pensions and wages. I have been living in the Detroit area for the past four months. In this area many employees are offered a buyout by GM. These buyouts for assembly line workers average around $100,000. That is alot of money. Now I have a huge problem with this. Union workers on the assembly line at GM make anywhere from $20-$30 an hour. What is it they do you ask? Most of them sit there or stand there and have one or a few jobs to accomplish repetitively. So you have a guy (or gal) on the line tightening one bolt all day long making $30 an hour. This is a problem. You have a similar employee working for one of the foreign automakers and they make around $10-$15 to do the same job. Why is that? Well it is because most foreign automakers are not unionized.

With healthcare GM's unionized workers do not pay deductibles on their health coverage. Hourly workers only pay 7% of their total healthcare costs, compared to 27 to 32 percent paid by the average U.S. salaried worker.

GM is now burning through about $6 billion dollars a quarter in cash, and only have about $15 billion left. The buyouts and the high union wages need to stop. If they would take a pay reduction to a figure comparative to the foreign non-unionized auto companies, and pay the average in healthcare costs, this in itself would save General Motors from a government bailout.

So you don't think I exonerate the white collar workers of GM. Rick Wagoner current CEO (and all the board of directors) also needs to help and do what Lee Iacocca did when Chrylser was in trouble in the late 1970's and that is take just a $1 a year salary until he can turn GM around. His making millions at this critical time is a disgrace to General Motors. He needs to lead by example.

The white collar workers need a pay reduction until happier times, and the liberalized unions need to step away from the automakers for good and allow them to operate. If they don't then they will be bankrupt or the government (i.e. the taxpayer) will have to bail them out. GM failing, or any of the other Big Three (Ford and Chrysler), would be a huge blow to our society which would destroy the already fragile economy and send Detroit and possibly the whole United States into a depression. Get the unions out and GM would survive, without our taxpayers help!

God be with us all!
Terry


"Some have an idea that the reason we in this country discard things so readily is because we have so much. The facts are exactly opposite - the reason we have so much is simply because we discard things so readily. We replace the old in return for something that will serve us better."
-Alfred P. Sloan
GM CEO 1923-1946