Sunday, November 26, 2006


Auto Execs Seek Out The Elusive Bush

Chief executive officers of the Big Three American auto manufacturers - i.e., GM, Ford and Chrysler - finally got to meet with President Bush on November 15th. This was conveniently after the elections, as has been much noted. Auto execs had been trying to meet with Bush since spring, but he had been putting them off. According to a UAW official in Kansas City, "The running joke around here was that the president had time to meet with the winner of 'American Idol', but he doesn't have the time to meet with GM's CEO."

The auto execs had some burning issues they wanted to discuss with Bush, such as trade and foreign currency - but also health care and "renewable fuels". Health care pensions for retired employees have been a major drag on the profitability of auto manufacturers. Auto execs and union officials implicitly agree that the ultimate solution is to replace private pensions with universal health care. "The automakers brought up their health-care costs, but that's a long-term problem that is connected to national policy," says auto industry research director George Magliano. "The industry can get behind trying to do something new with health care, but that's like turning an ocean liner around... it's going to take some time."

The auto industry's foreign competitors have national health care insurance, so why not the U.S.? According to auto industry expert Chris Kuehl, "Japan has a more comprehensive national health-care plan and pension system that allow... costs to be spread out and avoided by the employer." He adds, "That's true of the European players, too." UAW official John Melton asserts, "Health care is not a GM/UAW issue, it's the nation's problem. I think they'll start looking more at these things with the Democrats being elected last week. It seems like the foreign competitors have gotten all the breaks. Somehow, they've got to help U.S. companies, too."

With both workers and management clamoring for universal health care, the message is clear. The ball is in Bush's court, and if he has any common sense he knows what to do. It's not just the health of "the little people" that's at stake anymore - but the health of some of our largest industries. Unfortunately, the consensus is that Bush told the Big Three, "I feel your pain, but don't expect any cures." He apparently expects auto manufacturers to heedlessly slash all benefits as virtually all other industries have done to survive, but to their credit the Big Three would prefer to ensure the transfer of some of their responsibilities to the government rather than to relinquish them altogether.

"Big 3 auto execs meet with Bush" from Kansas City Star

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