Tags: UAW | bailout | GOP

Auto Union Accuses GOP of 'Subterfuge' On Bailout

Friday, 12 December 2008 12:32 PM

CHICAGO – The United Auto Workers union accused Republicans Friday of using politically-motivated "subterfuge" to undermine both Democrats and the union by scuttling a critical bailout of the automotive industry.

UAW President Ron Gettelfinger warned that General Motors and Chrysler would be "liquidated" and millions of jobs would be lost across the country unless the US Federal Reserve and Treasury deliver an industry bailout.

"It's important for the White House to exert its influence to get this money released as quickly as possible," Gettelfinger said at a press conference.

"We cannot afford for there to be a run on the banks, if you will, at these companies."

Gettelfinger, who has access to the financial records of the Big Three, said GM will run out of cash by the end of the month without government help and warned that Chrysler was not far behind.

Should suppliers begin demanding cash on delivery, plants would grind to a halt and a devastating domino effect would bring down the entire industry - including the US plants of foreign automakers like Toyota.

Last-ditch talks on a 14-billion-dollar package, backed by Democrats and the White House, broke down late Thursday after Senate Republicans insisted union wages be brought swiftly in line with those paid by foreign automakers.

Gettelfinger insisted the union had done its best in talks "knowing all the risk that was there, we were still willing to go the extra mile and negotiate with Senator (Bob) Corker on modifications to the bill that the White House had agreed to and had already been approved in the House of Representatives."

Even though the union was concerned it was being "set up" it agreed to make additional concessions including exchanging a large portion of its claims related to a retiree health care plan for equity or stock in the companies.

"These agreed-to changes would have made an enormous difference in the balance sheets of the companies and largely solved their financial problems," Gettelfinger said.

Claims that salaries were key to the breakdown was "just simply subterfuge on the part of the minority in the Republican Party who wanted to tear down agreement that we came up with."

"Senator Corker admitted to our people on the ground there that the other discussions over wages were largely about politics within the (Republican) caucus," Gettelfinger said.

"They thought perhaps they could have a two-fer here maybe, pierce the heart of organized labor, while representing the foreign brands," he said, referring to the fact that many of the Republican senators who most ardently opposed the bailout represented states where foreign automakers had set up non-unionized plants.

Gettelfinger said the union has already done much to bring their compensation levels in line with the non-unionized US plants of foreign competitors and that labor costs were not the major challenge facing automakers anymore.

"If we worked for nothing it wouldn't help them limp into January," Gettelfinger.

The legislation would have provided GM and Chrysler bridge loans to operate until March 31, the date by which they must have crafted a restructuring plan that ensures their long-term survival while repaying government aid.

The bill also required the president to name a special designee, or "car czar," who would oversee the process.

Republicans disputed Gettelfinger's claims and placed the blame squarely on the shoulder of the union for refusing to come up with a set date for when their compensation levels would come in line with those of foreign automakers.

"The one issue that stopped this thing - and I can tell you the Republicans wanted to get this through - was a competitive wage over time," Republican Senator Tom Coburn of Oklahoma told CNN.

"If you do not get that one vital component you can reduce the debt of GM ... you still don't have a way to create a positive cash flow and the only way the American people would ever get any money back is with a positive cash flow."

© 2008 Agence France Presse. All rights reserved.

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CHICAGO – The United Auto Workers union accused Republicans Friday of using politically-motivated "subterfuge" to undermine both Democrats and the union by scuttling a critical bailout of the automotive industry.UAW President Ron Gettelfinger warned that General Motors and...
Friday, 12 December 2008 12:32 PM
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