Wash. Times and Pittsburgh Tribune-Review publish false Heritage Foundation claims about autoworker compensation
SUMMARY: In recent days, The Washington Times and the Pittsburgh Tribune-Review published op-eds by members of the Heritage Foundation containing the false claim that union autoworkers earn $75 an hour in wages and benefits. In fact, according to General Motors, these claims are based not only on current workers' hourly wages and benefits, such as health care and retirement, but also retirement and health-care benefits that U.S. automakers are providing for current retirees.
In recent days, The Washington Times and the Pittsburgh Tribune-Review have published op-eds by members of the Heritage Foundation containing the false claim that union autoworkers earn $75 an hour in wages and benefits. In a November 28 Washington Times op-ed, Heritage Foundation president Ed Feulner claimed that "UAW [United Auto Workers] employees earn three times as much as an average blue collar worker makes -- $75 per hour on average in wages and benefits." Similarly, in a November 25 Pittsburgh Tribune-Review op-ed, Heritage fellow James Sherk claimed that "UAW workers are among the world's most affluent. They take home an eye-popping $75 an hour in wages and benefits -- triple what the average private-sector worker earns." In fact, autoworkers do not take home an average of $75 per hour. According to General Motors, these claims are based not only on current workers' hourly wages and benefits, such as health care and retirement, but also retirement and health-care benefits that U.S. automakers are providing for current retirees, as Media Matters for America has repeatedly noted.
Heritage senior research fellow James Gattuso also recently asserted without challenge on MSNBC's Hardball that "there's no reason that a UAW worker should get total compensation of $70 an hour when the average American only makes about $25 an hour in total compensation." Numerous media figures have also advanced the false claim that autoworkers earn $70 or more per hour in wages and benefits, some using it to blame auto workers for the domestic auto industry's financial straits.
From Feulner's November 28 op-ed in The Washington Times:
For starters, the Big Three need an affordable labor deal. Across the decades, Detroit's powerful United Auto Workers union has negotiated unsustainable pay packages for its members. UAW employees earn three times as much as an average blue collar worker makes -- $75 per hour on average in wages and benefits. That's also about $25 per hour more than American employees of Japanese automakers earn.
Health care for retirees and current workers costs the company $4.6 billion in 2007. That, in turn, adds $1,200 to the cost of each new GM vehicle produced in the United States.
A bailout would mean taxpayers -- many of whom make far less than the average autoworker -- would be stuck paying for these unaffordable pay packages. Under bankruptcy protection, though, automakers could hammer out better deals, allowing them to close unnecessary plants, trim their work forces and reduce pay and benefit packages to bring them in line with those offered by other heavy manufacturing.
To succeed in the long haul, the automakers must also be able to shut down makes and models that don't sell very well, and also close underperforming car dealerships.
From Sherk's November 25 op-ed in the Pittsburgh Tribune-Review:
Many factors have combined to bring the Big Three down, including poor management, too many brands, poor product design and too many costly dealerships. But the main reason they're on the verge of bankruptcy can be summed up in three letters: UAW.
UAW workers are among the world's most affluent. They take home an eye-popping $75 an hour in wages and benefits -- triple what the average private-sector worker earns. They get seven weeks' paid vacation and holidays.
UAW workers retire after 30 years on a generous pension. If they don't qualify for Social Security benefits because they're in their 50s, they get special bonus payments until they do.
[...]
Management also made its share of mistakes. Focusing on gas-guzzling SUVs was foolish in hindsight. But even that was brought on by the UAW. At $75 an hour the Big Three couldn't compete in the small and midsize car market. So they concentrated on making the trucks and SUVs on which they could still make a profit. Until oil hit $140 a barrel.
I mean, really, is it that hard of a distinction to make? You'd think that these folks were doing this on purpose to make the UAW look like a bunch of liberal elite money makers (making 150k/year working on an assembly line - like that's going to happen), just because they're in a union and all.
Oh wait, that IS what they're doing.
A little perspective for the right wingnutz claiming our auto workers are overpai: There was an article in Jim Hightower's excellent newsletter a while back that said the average American CEO's salary is over $7,000 per hour...
When there are dozens of ways to get ourselves from one place to another, why do we even want to keep building cars here in this country? The answer depends on what you think an economy is for. Expanding the middle class and lifting the most people out of poverty is what the economy is for. Building cars and paying people a living wage for their labor so they can cover their essential living expenses and retire comfortably with a little left over is why I think we should keep the big three strong. But the conservative argument that pushing down the cost of labor is an acceptable and natural function of markets is the kind of thinking that presides over the foreclosure of opportunity and oversees the outsourcing of good paying jobs. Conservatives, apparently, prefer elitist rule with a sharp divide between the very wealthy and the very poor; otherwise, they would fight for the right to a living wage for all workers instead of fomenting resentment among wage earners in an effort to besmirch union membership.
One of the authors of one of the above editorials makes a wage comparison between American and Japanese workers, albeit with fictitious American wages; first he ignores that Japanese auto makers are free from the cost of healthcare and; next he ignores They don't have the large amount of retiree pensions to pay because they have only been employing people here for 25 years.
As an aside, can we outsource CEO jibs, too, please? It's good business sense to dump these CEO salaries that drive up the cost of cars. For example, "in the fiscal year that ended in March 2007, Toyota’s top 32 executives — a group that included CEO Katsuaki Watanabe — together pulled in $7.8 million in bonuses on top of salaries of $12.1 million. For the comparable period, one single GM exec, CEO Rick Wagoner, raked in $10.2 million."
I think you've nailed it. The Conservative philosophy that has been spoonfed to the Troglodytes by Rush Limbaugh and his imitators is that the purpose of the economy is to make a handful of people filthy rich. In their perfect world, corporate profit is all that matters. If outsourcing jobs to another country improves the company bottom line, then so be it. If we don't reverse this trend immediately, we're screwed.
The weird thing is that the people who support this destructive philosophy will chant "USA...USA" at political rallies, and vilify Democrats for "not loving America".
Don't ya just love it? Liberals hate America.
Sarah Palin can thank a liberal that we so loved our country that we fought to expand rights for all Americans. Were it not for liberalism women like Sarah would not have the right to vote, forget about running for office. If conservatives had their way in the day, women would still be chattel.
Thing is, Toyota turns a profit. GM doesn't.
I know you care, that you respect the dignity of laborers, so I'm assuming you're not arguing for GM to dump their pension obligations. I'm guessing you believe that auto workers make an honest wage and have earned their benefits. So what's your point?
The UAW president got a few words in this weekend with Wolfie B. Good, we need more of their side on our head-in-the-sand media.
So, MMfA is claiming that the papers mentioned are double-counting retirement & healthcare benefits in that hourly wage, right? Because we WOULD correctly count healthcare & retirement in their hourly wage one time around.
If there is double-counting, shame on those claims, but if we assume that 50% of their hourly wage is going to benefits, they're still making approx $58/hr on average, and if they work 40hrs a week for an average of 50 weeks/year, they still make something like $115,000/yr? That's a pretty sweet annual haul and I can see why GM, etc may not have the profit margins that companies like Toyota have when they pay their workers $15-$25/hr.
I wish I could assume a wage like that.
So they've lied, its $116/hr on average um? By mid December it'll be $200/hr the way it keeps going up.
As cheap as nonunion labor is, $4 to $6/hr, its not enough for Toyota. Their going to Canada, where they don't have to pay for their serf's health coverage.
I find it much easier to make convincing arguments when I can just "assume" crucial points.
Hey, I'll admit I don't know exactly. Should we increase the % that goes to benefits? Decrease?
Increase them for every worker everywhere. And anyone who whines about the cost of labor can kiss my a... If an employer can't afford to pay living wage, they have no moral right to be in business in the first place.
I've read your posts my little cluckito, assumption is your middle name!
What?
I assume your referring to the $4 to $6 dollar figure. I was a bit quick there. Thats how much less an hour that the Japanese auto makers make per hour. Thats actual paycheck money, not the obscuring figure given out by the media.
Thing is, the average wage for the line workers who are also members of the UAW are around 28-30/hour. A lot less than what you're "assuming".
Does that figure include benefits and retirement for those workers?
Hourly wages are what people make in wages from hour to hour. Workers do not take an hourly portion of their retirement or benefits to the supermarket each weekend to buy chicken nuggents and milk.
We're getting off topic here, but yes they do take that to the supermarket, just after they retire.
It's dishonest to factor health care costs and retirement of current (and past) workers into someone's pre-taxed 'take home' pay.
Dexteritas knows that, but don't expect him to admit it.
History can actually read where I said it was wrong to combine both current and benefits, but don't expect him to admit it.
To sort of answer your question, I assume that you have a job. I will also assume for the sake of this answer, that you receive benefits in your job, such as employer paid healthcare, dental, vision, 401k, and things like that.
Do you take that money home with you at the end of the week, or every 2 weeks? I know that I don't.
I know it's just a typo, but your use of the term "chicken nuggents" brought to my mind a nightmarish hybrid of chicken nuggets and Ted Nugent. I might never sleep again.
What's happening is that the high number counts not only the average employees wages and health/retirement benefits, but also corresponding benefits being paid to retirees, i.e. non-employees. The way they arrive at that figure is that they take the total expenditure from the company that goes toward all wages and benefits, regardless of whether those benefits are for current or former employees, and divide by the number of current employees.
The resulting number might be useful for determining just how much these employers have to shell out, but it becomes misleading (and just plain misinformation) when the resulting number is touted as going to actual current employees.
Furthermore, the number is no longer accurate, because it doesn't take into account that the automakers no longer make these payments themselves. The money to fund retiree health care has already been dumped into funds and the employers are no longer responsible for administering any of those benefits. Also, since the enactment of the poorly named Pension Protection Act, the assumptions that the Heritage Foundation use to arrive at the disputed number are no longer accurate.
I don't know if that totally answers your question, but the long and short of it is that the number is BS.
How on earth could an auto worker's hourly wage include benefits paid to retirees? This is amazingly dishonest reporting.
I feel like a complete idiot since this new math has come out. I work for somebody else now, but I employed people in the past when I had a small business. I was dumb enough to sit down with everybody I hired and negotiate their pay, not realizing that I could have included contributions to my own 401k as part of their wage.Dang.
I believe what they're looking at, is total cost of what they put into a car per worker. Now if they would make this distinction, it wouldn't be a bad thing, but alas, they keep saying the average wage for a worker is 78/hour, which is flat out wrong, and if it were right, we'd see a crazy long list for people trying to get those jobs.
The math is just wrong and the implication that America's working class are somehow being paid too much is truly disgusting. After taxes, the average autoworker takes home about $3,500 a month, about $42,000 a year. That's about $808 a week to use to pay bills and buy food.
Compensation PACKAGES always refer to a: HOURLY WAGE b: MEDICAL c: DISABILITY AND WORKMAN'S COMP d: RETIREMENT That is exactly what was stated because that's exactly what it is!!! DUH!!! Even the boneheads @ MMFA, who will "file 13" this email when they "review" it, should be able to figure out!!! I guess since it only takes a GED to work @ MMFA, English isn't a priority!
I'm not sure what this email is you're writing about, but it may just be one more thing you're confused about. Take a look at this line from one of the articles above;
They take home an eye-popping $75 an hour in wages and benefits...
Do you think this was deliberately trying to deceive? Do you think the words "take home" were just sloppiness or an accident?
If you've got that figured out, here's something else to work on. If somebody asked you how much you "take home" at your current job, would you give a number that included money your employer is paying to former employees?
This shouldn't be that difficult. Try making English a priority.
This is what guys like sigtek always say when they write something stupid, they put out the disclaimer such as, "I bet *name your website here* doesn't dare to print this!!! LOL!!!" because then when they get things removed for, you know, not being relevant to the discussion at hand, they scream about persecution, and 1st amendment rights, and other things that don't apply.
Thanks, Mag. I was a little unclear, but I guess Siggy thinks he's emailing somebody when he posts here. I thought it was all the Caps and quotes and !!!! and ???? that had me too disoriented to make sense of it.
Hey Dunce,
Why don't you tell us how much you make, including medical, dental, disability, retirement, and workman's comp? I'm willing to bet, you don't even know. Also, I'm sure that, once again, like the rest of us, you're more concerned about what money is going into your bank account (as in, your salary) as opposed to the total being paid out by your company for you to work for them.
What I find remarkable in this whole debate is the absolute hypocrisy demonstrated by the Conservative side. (Yeah, there's a surprise!)
When Obama said he was going to increase taxes on those making 250,000, they didn't consider 250,000 to be very much money. In fact, they implied that it was practically middle class. Joe the F***ing Plumber was sure that he would make at least that much next year!
Now, the same people are absolutely hysterical over the "excessive" amount paid to UAW workers. But, even if we concede their $73 per hour figure, it is still much less than $250,000. Joe the F***ing Plumber would be insulted by $73 an hour.... at least in his fantasy world.
You're right. The more we peel back the layers of their hypocritical argument, the more it becomes apparent that the core of this assault on living wages isn't about lowering costs of cars for consumers. It's about killing the union.
Another layer of the screaming right wing's hypocrisy is their fake a.. faith in the free market. In a truly open free market laborers would be FREE, and indeed, encouraged as a natural function of the market, to organize themselves for more equal bargaining leverage. Fat chance fining a market fundie who admits, let alone supports, that truth.
What's your definition of a living wage? $32/hr is GREAT living for a single person.
An adult wage for a single person. The average CEO does $7000/hr. Enough for a goodly yacht and a support in style for the trophy mistress.
Yeah, $32/hr would be a great living wage. Too bad the Cons kick and scream every time we try to raise the minimum wage, which is about 20% of that.
What's your argument? That $32/hr is too much? It's a solid middle class earning and if we all got guaranteed healthcare and free education, I think your number is a good start. Index the minimum wage to inflation and share the company profits that even janitors help create. That's a good starting formula for a living wage. Make the middle class as large as possible, I'm all for it, buddy. Don't know what your problem is. Shoot, brother, If we all made one tenth of GM's Rick Wagoner, we all would be making a cool million a year and that guy makes chump change compared to banking execs. I mean, is the guy who runs YOUR company really ten times smarter or ten times more productive than YOU?
Why on earth you would argue for greater income inequality is a mystery to me. Wealth is created as a function of accumulated knowledge and nobody is THAT much (500 times) smarter or more productive than anybody else.
Outrageous financial inequity is all about ego and feeling superior. Nothing more.
Go ahead keep racing to the bottom of the wage barrel, numbskull,
Basic rule of thumb: if it's printed in the Washington Times or released by the Heritage Foundation, it's a lie.
This whole "$75/hr" thing is as ridiculous as noting the CEO pay at GM. It looks like GM lost over $4000/vehicle last year, 39B loss, maybe 8 million vehicles sold world-wide. The UAW could work for nothing, the CEO could work for nothing and they still would have lost somewhere around $1000-2800 per vehicle, depending on how the wage thing is figured. The whole business plan is out of whack at GM and I doubt it's much better at Ford or Chrysler.
DOH!
Don't look now, but the "Obama Recession" started almost a year ago.... before Obama was even the official nominee. Now, THAT's power!
http://www.huffingtonpost.com/2008/12/01/us-recession-began-one-ye_n_147421.html
That's no problem for conservatives. Grover "Obama is Kerry with a tan" Norquist says that the problem all started with the Democratic takeover of Congress in 2006, which alerted Wall Street to the possiblity that the Bush tax cuts would be allowed to expire in another four years.
He calls it the Pelosi-Reid-Obama recession. It's not very catchy, I know.
Ah yes. The old, "Blame everyone else but ourselves" catch all. I love it.
I'm willing to bet that Krugman, you know, a guy that is a liberal and actually knows what he's talking about, would disagree with Grover on, well, just about everything, and then Krugman, would actually be correct.
I'd put Krugman's, Nobel prize against Norquist's tiny minded ideology any day.
I keep waiting for Media Matters to report the actual hourly wage (and that does not mean you simply repeat what the UAW says.)
If you can't tell us what is right how can you tell us what is wrong?
What the UAW says is the figure in the contract negotiated with the Big Three. Why don't the Big Three simply state what they pay per hour? Because they would rather slant things in their favour.
The MSM is revealing to American workers that they have foud out who is to blame for the recession/depression - the workers! Workers are paid too much and get too many benefits which drives the companies into bancruptcy. Free market dictates that the Rich are supposed to get richer and the Poor are supposed to get poorer.
Out for another early morning troll are we? We went through this last week and the breakdown was posted. Yes it was from the UAW. You have a problem with this why? Here is another analysis from Jonathan Cohn at the New Repulic. But if you have been following thse pages you already have this information. The burden of proving otherwise is now on you. We know what is right. You don't. Ignoring facts and arguments won't cut it here. Get yourself some headphones and go back to listening to broadcasts from Hannity, Limbaugh, and O'Reilly from your Mothership. Make sure you are in the fetal position and with your thumb in your mouth and your eyes closed while you do this. That way you won't be troubled by facts and evidence.
"If you can't tell us what is right how can you tell us what is wrong?"
I have another question--if you don't know anything at all why bother to post? On second thought--don't bother to answer. Clearly in your case none of this is worth the effort.
But, Blueneck, al "keeps waiting" for MMFA to provide the info he wants. Sure, it's been covered here, but al seems to be working in real time, where there's no burden on him to find the info., it's up to MMFA to have it on their home page in big red letters every day. And that goes for anything al wants on any given day.
You guys can continue to argue over whether or not the UAW guys earn 75 bucks an hour or not. The bigger picturs is that they are pricing themselves right out of existence. Does it really matter when many of them may be out of a job?
Not really. The UAW has made major concessions in decreased pay and benefits over the last 4 years. They have done their part to keep the company competitive, but management fails to make commensurate sacrifices and develop a better product.
Meanwhile, Japanese auto execs make 10 times less than their American counterparts and still manage to oversee the production of cars people want to drive. How is that, Dave? How is it American auto executives get their butts kicked and sill they try to tell us they're so much brighter, more productive and more deserving of their outrageous compensation than the people they compete against.
Have you seen the difference between what the average worker of GM makes compared to what the average worker of say, Toyota makes? Its no wonder the big 3 find themselves on Capital Hill today asking for money. The business model they've constructed for themselves won't work.
So what is the difference? And why do these conservative media outlets need to lie about it?
In real dollars, among workers here in the U.S., it ain't that big of a difference. But, I really don't care what the difference is because I am not here to stoke resentment among wage earners. I'm not here to argue that workers ought to just shut up and accept less and less so executive bastards can take more and more in exchange for failure and massive income inequality.
You cons have abandoned the core family values that set your movement apart. You have sacrificed those values at the altar of the free market. The greatest human goods of all, a strong family and nurturant community, which both require living wages to be sustained, are assigned zero value in your cultic, market fundamentalist daze that rationalizes injustice of inequality.
The rant is noted. But we Conservatives have never gone against our core values. Free market and taxes being the most important. We do have some Cino's in our ranks, as do all parties...that's a given. The strong family value thing is becoming less and less important, at least here in NY, but it is still an important part of the C itinerary. IMO, the big 3 have priced themselves out of the global market and do not deserve a bailout. Let them fail. And let the Execs find other jobs. I have no problem with that. The market will decide their fate.
Dude, I know by the way you slink away from your main points that you're just talkin' smack. You're pathetic.
Anyway, I don't see tax policy or market ideology as being a value, but you're right, you haven't strayed from the ideology of tax deals for the wealthy and market fundamentalism, in doing so, you cons have failed on the promise of creating broad prosperity and opportunity. Your day is done. You failed. Good riddance.
Family is all we're going to have left to turn to in these lean times, so go ahead and forsake those human ties if you think it prudent. Your answer is drop dead anyway, so I guess that's consistent. You would have millions of workers out of a job, on the public dole and eventually taking low wage service sector jobs in exchange, thereby creating even sharper divides and steeper climbs between income possibilities. Why? Because you believe the market will take care of things in the long run. Well, Mr. Hoover, in the long run we're all dead. But your answer is drop dead anyway.
You suffer from a lack of vision and anger that is not only self-loathing but destructive for the country. You can't see the long term consequences of letting the big three fail and gutting the unions.
Reality refuses to conform to your beliefs, so you rage in destructive fits and yell, "nobody deserves a bailout," not even realizing that you are like a disillusioned religious zealot who has just had his world topple under the weight of its own fantasy.
Dude, I know by the way you slink away from your main points that you're just talkin' smack. You're pathetic.
If you can tell me what I've "slinked" away from I can explain it to you. I thought I've been pretty explanatory. And as a side, I'm not angry, I've no stake in the UAW. I drive primarily a Mercedes. Good car.
Your main point was that autoworkers at GM make so much more than Toyota workers and that was the problem with GM. Then you dropped it. Slinked quietly away from it, in fact, never brought up the point again once you were challenged on it. To me, that's pathetic.
Yes, you do have a stake in the UAW and I don't care what you drive. They (UAW) represent 3 to 5 million people and should the big three go bankrupt the repercussions would be calamitous for the country at large and the economy. That includes you and me, we will be affected, too.
As for your anger, it is evident in your willingness to offer no help, to watch people suffer because you do not believe they lived in accordance with your harsh economic dogma. Then again, maybe it's not anger, maybe in typical con fashion, you delight in the entertainment of witnessing the pain of others.
Instead of re-envisioning a more equitable U.S. auto industry, in which, the product is more in tune with our needs (as the Japanese are able to produce) and the profits are shared throughout the company (as it ought to be anyway), you say punish them for not adhering to my personal market fundamentalist view.
No response, Dave? Typical.
Just a note to the general conversation. I found this on the net (sorry no link)
But these days, health care costs are causing enormous financial headaches for the Big Three. G.M. has an unfunded liability of $85 billion in today's money to cover future health care costs for workers and retirees. That is seven to eight times the market value of the whole company.
General Motors estimates that health care costs add about $1,500 to the cost of each vehicle it makes in the United States. Chrysler claims a health care cost of $1,400 per vehicle. Ford says its burden is $1,100.
The operative word here is "unfunded". If GM had invested some of its profits during the "good time" when it was making $10,000 profit off of Suburbans, etc then their labor and pension costs would not be in the $70 an hour range. Granted a big reason Toyota and Honda don't have as large a labor and pension obligation is because they don't have 400,000 plus retirees, and spouses, that they are paying benifits for, GM wouldn't have as large a burden either, if they had invested wisely.Here is what I do not get. Whether or not the CURRENT workers make $70 or not is irrelavent. The fact is, every single GM car cost more to make, on average, than a Toyota, Honda, amazingly even a BMW (compared to a similar Cadlillac.) You can call the $70 "labour costs" or "costs associated with all current and former employees", but the fact is, that is about $1500 PER CAR that Toyota or Honda or VW can use to either add $1500 worth of features, take $1500 off of the price, provide $1500 worth of free warrentee coverage, or some combination thereof. That means GM makes worse cars than the others for the same price. Which, along with the higher resale value for the aformentioned foriegn cars, is why anyone with half a brain would buy anything but an American car, all else equal.
Sure, a few models made by U.S. companies here and there are good, but if you buy a camry or an accord, you will get $1500 worth of features that you would NOT get on a similarly priced malibu, PLUS you know from Kelly Blue Book that the Japanese cars will re-sell for 40% or so of their original price, versus 20% for the chevy. Its a no-brainer.