The Automaker's Carcass: Hanging from a Union Tree

By Bill Glynn

Bail them out? Who is going to buy cars? And while they go bankrupt, union workers get paid way over market value. Sorry to say, unions are a thing of the past and will force other industries down the toilet just like the airlines. It's a form of cancer that can be cured but has to be ripped out of the body. The problem to be fixed isn't one company at a time; it is systemic and the entire industry needs to be revamped. The bailout buzz around the big automakers, especially GM, is finally coming to a head. Even if the companies are bailed out, the results will be the same - dying on a vine or in this case already a carcass hanging from one - and unions are a big part of the lynching. If the companies were bailed out, I will bet my life that people won't buy enough cars to keep them afloat anyway. Yes, the industry touches 1 in 5 jobs in America, but it's a dinosaur industry compared to the rest of the world. Strapped with unions and debt, and the fact that they have so many cars in the system right now that aren't selling, their dealers can't absorb more and stay in business as well. This means that automakers, even if they stay in business, can't push cars into a consumption economy that can't or won't buy them. So they keep making more cars and staying afloat, but in the end the body can't be resuscitated while workers keep getting paid and the cars don't sell - even to the dealerships. [more...]