LET'S GET READY TO RUMBLE---IT'S EITHER UAW UBER ALLES OR IT AIN'T

From time to time over the past few months I have commented on the widely held opinion that "it is impossible to stay in business if you have a UAW contract." The first bankruptcy revolving almost entirely around a UAW contract---pensions, medical care, work rules---is under way. Delphi is an auto parts manufacturer and the biggest supplier of parts to GM. It used to be a part of GM and was spun off in 1999. However, you can never divest yourself of the UAW once they are in the door.

Among the thorniest problems will be deciding who is responsible for post-retirement and health-care benefits that GM, which shares many of the same problems that sent Delphi into Chapter 11, has said could cost it up to $11 billion.

That is eleven billion that not even GM has in the til. Delphi wants to junk the entire UAW contract and the UAW ain't happy.

Alluding to that possibility, UAW leaders said in a statement on Saturday that it would be "an extremely bitter pill" to swallow. "I think this case is, in fact, a watershed. I think what it does is -- in the most dramatic way we've seen to date -- it introduces the wages of the global economy into Main Street in Michigan, Ohio and elsewhere," said Harley Shaiken, a professor at the University of California-Berkeley specializing in labor issues.

The courts could rule several ways here---there is no doubt that Delphi is broke---they could order a near bankrupt GM to take back the company which would probably cause GM to file too; they could allow Delphi to remain in business with a shell of a UAW contract they would have to honor; or they could go along with what Delphi says it must have if creditors are to be satisfied. The trial will be conducted in New York, not in Michigan where the UAW has literally appointed most of the judges. We all have a stake in the outcome, because if the judge rules largely in favor of Delphi it may mean that Ford and GM can bust away from their UAW contracts. Stay tuned on this one. The UAW has thugs galore, has rioted in the past, and can paralyze the country. There is also the usual race component because the UAW was in the forefront of the Civil Rights movement in the mid part of the century and forced companies to hire Blacks who are a large part of the union. The UAW is the last large industrial union standing, their members regard their jobs as an entitlement, and don't think for a moment they won't resort to violence if their candy is taken away. There is a major article HERE that states:

Banc of America Securities, a brokerage firm that tracks companies for investors, released a report that said Delphi's bankruptcy created a 30% chance GM would follow suit. Standard & Poor's downgraded GM's long-term credit rating, already at junk bond status, to BB--, meaning the company faces uncertainties that could keep it from meeting financial commitments.

Both of the photos were taken in Detroit during two riots, one of which (1943) quickly degenerated into a notorious race riot. You will note in the fuzzy black and white picture that Blacks are shown looting downtown businesses exactly as they do today. The sepia tone photo shows mostly white people turning over a car and breaking into an unidentified structure, presumably a unit of the Ford company. White mobs always turn cars over, whether they are rioting over winning a game or having their beer taken away. The UAW has a long history of violence, which was originally started by corporate thugs hired by both GM and Ford to beat and assault workers. The workers retaliated and these stories have become legend and lore within the UAW. The violence was a function of both sexes as the famous picture below shows....
















Two women battle to the bloody end in the Ford strike.