Akkam’s Razor

So GM and Ford have been getting their asses handed to them in the showroom and on the financials.  What do the red state whiz kids come up with?  When in doubt blame the unions.

Rich Lowry, of the National Review, said in the Salt Lake Tribune via Left Lane News:

The announcement by General Motors that it is slashing 30,000 jobs and closing all or parts of 12 plants is the fruit of decades of "victories" by the United Auto Workers that even King Pyrrhus would consider shortsighted. The union has done so well at the bargaining table that it has priced its workers out of jobs.

According to the Bureau of Labor Statistics, the average hourly manufacturing wage is roughly $16. Autoworkers for the Big Three, in contrast, earn more than $25 an hour. Who says the UAW doesn’t get results? On top of the wages are cushy benefits that mean it costs automakers roughly $65 an hour to employ its workers. The expense of pensions for retired workers - and there are more than twice as many GM retirees as current workers - adds about $2,500 to the price of every car.

There is a high cost to unsustainably high wages and benefits - they tend to destroy the businesses in question.

If an enemy conspirator had infiltrated the U.S. auto industry with the mission of undermining it from within, he couldn’t have come up with a worse system.

Simpleton #2, the Wall Street Journal’s Michael Barone says (on a more fair and less ideology driven article) on Opinion Journal via Autoblog:

Union-driven legacy costs have already forced many steel companies and airlines into bankruptcy, with pension obligations fobbed off on the Pension Benefit Guaranty Corp. The Big Three auto companies might as well do the same. At least there aren’t that many big unionized private industries left to fall. Besides, taxpayers and politicians angry at costs imposed by unions–particularly in the public sector–can always change the rules and reduce unions’ bargaining leverage. Just as the economic marketplace eventually reduced the power of the old industrial unions, the political marketplace could, in time, reduce the power of the "post-industrial" unions.

The attempt to protect workers from all risk has turned out to be very risky indeed, since in a dynamic economy large corporations are subject to competition from firms with lower costs. In the auto industry the result is significant pain for those who relied on the Big Three and the UAW; but the result is also a vastly faster growing economy and many more opportunities than provided by the European welfare states.

So the conclusion obviously is, blame the victim for fighting to keep what he has.  What a load of shit.  Do UAW members design cars?  Did any of them sign off on the Aztec?  How about deciding to depend on fleet sales (and lower profits) to deliver volume, thus devaluing their cars (more cars on the used car market equals lower prices).

To understand this, you really have to delve into the anti-union paranoia of groups like the John Birch Society and the Federalist Society, and others who share the Joe McCarthy era anti-communism vibe.  See, labor unions are socialism in concept, which is communism, which is evil.  Therefore, they are to be hated and scorned.  Maybe that explains part of the Honda-Toyota effect, since there in “red” states who hate northern liberals.

See, everyone can have fun demonizing people and making reductionistic generalizations.