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Steve Chiotakis: So, General Motors and Chrysler get a bailout — $17 billion in loans to help them through a tough period. There are strings attached involving wages. The United Auto Workers union doesn’t like those strings, and that’ll make for a rough road of negotiations ahead. Here’s Marketplace’s Steve Henn.
Steve Henn: The UAW has agreed in principal to a series of concessions, including ending job banks which pay workers even after they’re laid off. But many analysts say deeper cuts are needed.
When Don Grimes was a young man, he got a job on a GM assembly line.
Don Grimes: It certainly helped pay for college. It was very lucrative and I’m very thankful for that, but the truth is it’s unsustainable.
Today, Grimes is a researcher specializing in labor issues at the University of Michigan. He says when he was young, the Big Three basically had a monopoly. Workers and management divvied up windfall profits. But those days are gone.
Grimes: It doesn’t give me any pleasure in saying this, but you have to have labor costs that match up with your competitors. That’s the end of the story.
The bailout signed last week call for the automakers and the unions to do just that. But union leaders may try to rework that deal in the new year after President-elect Obama takes office.
In Washington, I’m Steve Henn for Marketplace.
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