Union Destruction

The unions are at it again. The UAW has nearly killed the big three auto companies but fails to connect their actions to the decline in union jobs, decline in profits, and slow deaths of the companies they are bleeding dry. Through their lobbying on congress the UAW managed to get some protective tariffs in place but rather than making the foreign manufacturers less competitive they simply began manufacturing their products in the US in non-UAW plants. The UAW maintains that without their pressure these plants would not be paying the high wages that they do. Certainly there is some truth to this allegation but the UAW tries to ignore the fact that these foreign manufacturers are not burdened with a seniority system or debilitating retirement programs, or onerous healthcare obligations. These are all “benefits” that the UAW has won over the years for their members. The result is an aging workforce, exorbitant healthcare costs, a generous pension program that cost more each year, excessive numbers of employees, and an uncompetitive salary structure.

The UAW is now trapped in their own rhetoric and any retreat from these “benefits” is almost impossible. Their membership continues to decline as the companies they have unionized continue to sink into irrelevancy with ever declining market share. Of course, the management of these auto manufacturers shares some of the blame as well. After all they surrendered to the union blackmail year after year and kept feeding that tiger until now the tiger threatens to consume them. At least some of this problem lies with the incestuous relationship within the auto industry. Auto executives simply move from company A to company B then to Company C and then back to company A. No company would even consider hiring a senior executive who wasn’t a “car guy”. This attitude has ensured that no fresh thinking would be introduced to challenge the status quo. Recently Ford has hired an executive outside of the auto industry and this is a first. However, it may be too late because Ford like all of the big three auto companies is bloated and virtually paralyzed by the UAW. The challenge for the non-car guy will be to find a way to escape the clutches of the UAW and undo years and years of management thinking that has pitted labor against management.

However, the auto industry isn’t the only industry that is dominated by unions that are gradually destroying their industry and the teacher’s union is a prime example. This is a group who are heavily unionized, have no quality metric, and protected by tenure. This is not a problem in and of itself, but when high schools are graduating students who can’t read or spell and who have limited mathematical skills, then that is a problem. At the same time these teachers are complaining that they are under paid and over worked. The underpaid argument rings very hollow when you examine their pay on an hourly or per diem basis. When teachers are measured on their actual scheduled work days, their pay is equivalent to that of computer programmers and engineers. The reality is that these teachers only work nine months of the year and of those 270 days they actually work less than 180 days. Of course the teachers like to point out that they are required to constantly educate themselves and frequently work long hours. Naturally they seem to not realize that ALL professionals require constant education and the 40 hour work week is only a baseline and most professionals work well over the 40 hour baseline.

Another factor that the teachers fail to recognize is that unlike virtually all other professionals they have no metric. They produce educated students but they resist all attempts to measure the quality of the education of these students. Even when standardized tests are forced upon them, there is no punishment for those teachers whose students fail the tests. They mumble and grumble and blame everyone but themselves. The incompetent and the competent are treated alike unlike normal business where the incompetent are weeded out. In the education community they are given tenure and protected by their union. The result is the continued erosion of the public school system and the continued decline of their reputation as professionals.

What about universities and their professors? This is a very good question and it appears that as the quality of education has declined the tuition for a substandard education has increased. This is especially true for the highly prestigious universities where the tuition commonly runs in the tens of thousands. These highly vaunted bastions of education are rated on reputation which is based on the number of PhD’s they have and the professional stature of those PhD’s. Of course the undergraduate student may never actually see his professor and the greater the prestige of the university the more probable that is true. The student enrolls for a class taught by Professor Doe only to discover that the actual class is conducted by a teaching assistant. In any other business this would be called fraud but at the university level this is called standard practice.

As bad as this is, the worst is that these bastions of learning have become so politically correct and so concerned about creating an egalitarian society that they no longer fail students and the letter grades have become so eroded that any student who has less than a 3.0 average must be brain dead. In fact the grade erosion at Harvard has gotten so bad that almost half of the graduates are Cum Laude. Some examples of university level work are:

Europe was disrupted by the fast paste of change
Thomas Jefferson was president, founder of the University of Virginia, and author of the Decoration of Independence.
Germany’s William II had a chimp on his shoulder.

These gaffes can be attributed to misspellings due to haste rather than a poor understanding of the subject or an inability to spell. But these are not the only things they come from college graduates. All too often when questioned college students and college graduates show an appalling lack of knowledge of such things as geography; for example:

The first example of modification was in small cities such as Connecticut.
Northern Africa is the region which lies just north of Africa and is therefore not part of Africa.
The five European grade powers were France, Germany, England, Russia, and Australia-Mongolia.

These are products of our current university system, young people who have paid a considerable sum of money for their “education”. You can rest assured that the professors who have produced this shoddy product are either unionized or protected by tenure or both. The time has long past when teachers and professors should be called to account. Also students should not be given a passing grade when they clearly don’t deserve it. Unions are killing industry but it seems to me that the greater threat is to our students.

Another View From The Couch

As I watch the world flash in front of my eyes via television I continue to be astonished by virtually everything that I see. From my perch I am beginning to grasp why the world is in such poor shape, because what I see is a vast throng of people who seem unable to think for themselves but instead are being led about by their nose – or should I say nose rings. Mostly these are the youth of America who are determined to express themselves and demonstrate their uniqueness by being like everyone else trying to be unique. You see these folks every where, with the obligatory tattoo(s), body piercing(s), or my very favorite – black nail polish. Wow – Gee Whiz – how original. But these are mostly kids or immature young adults and so I guess this is somewhat understandable but what about all of those unshaven guys that are popping up everywhere? Are these guys expressing themselves and if so how? It looks like a simple case of laziness translated into poor personal hygiene and an inability to think or act independently.

However, it isn’t just the sameness and lack of independence that I see presented to me, but the truly alarming shallowness of what I see. In fact just last night I heard the announcer selling a new TV show describe it as being “extraordinarily and deeply superficial”. I gave him stars for honesty but I somehow doubt his target audience reacted negatively to this announcement, not because they were repelled by it but because they didn’t know the meaning of superficial. You doubt this? Have you recently read anything written by a high school or college graduate? Let me provide you some examples of responses offered by college students.

The Industrial revolution was slow at first due to the lack of factories. European nations had the raw materials to start and(sic) industrial revolution, but they did not have the knowledge to start a revolution and thus were retarded. – I’m sure this response made some high school teacher race to his/her union steward and demand to know what is wrong with this answer. How about this one:

The Russian Revolution of 1905 began about 1907. Unfortunately the Czar was easily influenced by flutterers. The Triple Alliance faced NATO. This too was produced by Bismarck who worked for Caesar at the time. Certainly this student seems to be a victim of poor spelling at the very least and totally confused chronologically at worst, but who is responsible for this the student for failing to learn? The teacher for failing to teach? Or the school administration for allowing this student to graduate from high school and then enter college. Who is minding the store? You must wonder what is being taught in school these days or more importantly is anything being taught. If I hear some idiot say “I seen it” one more time I may throw a brick through my TV or even assault the person. I can see the headline now – “Student violently assaulted by insane grammarian”. At the very least we can conclude that verb conjugation isn’t currently being taught.

While flipping through the channels I came across an series of interviews with young skinheads. These were mostly young men between the ages of 16 and 21 with the obligatory shaved heads, tattoos, and attitudes who were being led by young men in their 30’s who were certainly old enough to know better. These boys could be described as disaffected or life’s losers but listening to them you quickly realize they have virtually no real understanding of the world, their environment, or what is happening. They explain that they are victims of “affirmative action” because all jobs go to minorities and besides the entire economy is moving into a service economy. These glib answers roll off of their tongue like rote responses but clearly they have no idea as what a service economy is or what globalization is, or what is happening to all of those factory jobs that they thought they should have. They blame “affirmative action” without actually being able to connect that to their plight. They fail to grasp that there is a very low demand for unskilled labor and that jobs go those with skills. Instead of an education they got tattoos and seem unable to connect the dots between their decisions and their current situation. It is easier to blame some external force or group than to look in the mirror.

The morning news brought the stunning revelation that unions might actually be a drag on the Michigan economy. This little gem of logic was offered with a sense of surprise and discovery, which is not surprising since Michigan is not only heavily unionized but it is virtually a neo-socialist state. Between the teachers union, the UAW, and the gaggle of other unions, there is a sense of entitlement that is pervasive. These unions were intended to protect the worker from exploitation but have resulted in oppressing the employer. Unions can no longer control the supply of unskilled labor because that type of labor is now available on a global scale. The unions set uncompetitive labor rates and the result is fewer jobs. This connection between their unrealistic expectations and the globalization of the labor market seem to be beyond their comprehension. They appear on TV and in the newspapers blaming the Republicans, the politicians, executives, illegal aliens, and for all I know aliens from outer space for their plight. They believe they have a “right” to a high paying job that expects them to screw two parts together. More than that, even those that are still employed are aghast at the prospect of actually having to pay some portion of their healthcare. They feel they have a “right” to free healthcare and benefits. They seem unable to grasp that nothing in life is free and that if they aren’t paying for their benefits someone somewhere is paying.

Of course television isn’t a complete wasteland, from time to time something pops up that you won’t see anywhere else. It seems that the accepted scientific fact that a meteor killed off the dinosaurs has come into question. Naturally the entire scientific community is up in arms over this but unfortunately some very awkward fossils have turned up. Adding to the problem is the realization that the fossil record for the Cretaceous shows a steady decline in dinosaurs over several million years. The conclusion is that the lush vegetation needed by the dinosaurs was disappearing and the dinosaurs were dying out naturally. The meteor(s) did not kill off the Dinosaurs but may have been the final nail. Even without the meteor(s) the dinosaurs would have gone extinct. Of course this will probably not cause any changes to the true believers in science who still believe in Evolution and other scientific dogmas.

So the couch is a wonderful perch from which to view the world. Right now I am off to buy some of those marvelous drugs that have what seem like some very challenging side-effects.

Collateral Damage In The Global Economy

There is no doubt but that we are competing in an increasingly competitive global market, but this is a market environment that has its dark side. The United States is the largest consumer market in the world with Europe a close second but these consumer markets rest on a foundation of wealth which in turn rests on wages. But wages are increasingly under competitive pressures from abroad where highly trained people plus thousands of unskilled workers are available for a fraction of the cost in either America or Europe.

At the turn of the 20th Century more than half of the population was engaged in agriculture with a relatively small percentage engaged in manufacturing. By 1950 the number of people engaged in agriculture had dropped to a small percentage and 50% of the working population was engaged in manufacturing. During the first half of the 20th Century the union movement was instrumental in creating high paying jobs and curtailing the exploitation of the worker. The union movement reached its apogee in the 1950’s and has been declining ever since – primarily because manufacturing jobs have declined to the point where less than 10% of the working population is engaged in manufacturing. Today most manufacturing is done overseas using cheaper labor but the actual unemployment level in the US is approximately 5% which is about where it runs historically. The unemployment rate in Europe is over 10% and rising primarily due to their attempts to maintain employment levels through government control and tariffs. The US has not followed this path but nevertheless this shift from unskilled manufacturing has resulted in some collateral damage to the working class.

As the US moves away from manufacturing and into the service economy it is creating some displacement. The government and various pundits are pushing education as a solution and pointing out that there are plenty of jobs for those who have an education and skills that are not readily available overseas. While this is a logical solution for many people there are those in society who do not fit in a scholastic environment and these are increasingly becoming collateral damage. The service economy certainly includes all of those trained and educated workers but it also includes skilled workers such as; carpenters, plumbers, painters, small business owners, various healthcare workers, and a variety of similar jobs. For the most part these people are employed and make a living wage but there are many workers who are being displaced by machines and by jobs moving overseas who do not have these skills or training. These workers have few options other than retraining and if they cannot succeed in an academic environment then their options are severely limited.

There is increasing pressure for the government to do something and this cry is usually accompanied by the idea that the government should “create jobs”. But the reality is that the government cannot create jobs unless those jobs are government jobs. The government does not produce anything and certainly nothing that even resembles profits so the salaries for all government workers must come from tax revenues. This means that for every job created the government must either increase taxes or reduce spending on existing programs but as everyone knows neither option is attractive to a politician so nothing gets done. Besides, creating government jobs has been the European and UAW solution for years and the result has been catastrophic for both. European countries are staggering under the weight of their welfare states and the UAW is not only hemorrhaging members it is eliminating jobs as well.

As much as the liberal establishment may dislike it, jobs are created by capitalists – that is entrepreneurs and those individuals willing to invest their capital in the profit making enterprise. The less money that is taken from the capitalists the more money is available for investment. The sad reality is that those who advocate big government and government created jobs seem to think that the capitalists are those wealthy individuals with high incomes. This common liberal viewpoint demonstrates an appalling ignorance not only of capitalism but how a capitalist economy works. The money that is invested comes from capitalists alright but these are those individuals who are prudent enough to have saved money, which they have put into the bank, into stocks, or into mutual funds. This is the money that fuels our economy and generates tax revenues for the government, profits (dividends) for the investor (saver), and jobs for others. It is this growth in employment that generates increased tax revenues so as taxes are lowered more money becomes available for investment and paradoxically everybody benefits and the economy grows. As taxes are increased the capital shrinks, jobs evaporate, and tax revenues decline so taxes must be increased in order to sustain the government benefit programs, which starts a cycle of decline. This is a lesson that the big government liberal establishment seems to be incapable of grasping. Therefore, to blame businesses for moving jobs offshore is simply an example of how the Unions and Liberal establishment either cannot or will not accept the realities of a capitalist economy. In socialism the objective is employment in capitalism the objective is profit.

Although the issue is focused by the Unions and Liberal Politicians to the movement of jobs offshore, in reality there are many sectors of the economy that are booming and show positive rates of employment -- but not all. The US Bureau of Labor Statistics shows that production jobs have declined 6% since 1996 but manufacturing jobs have declined 17% and Production manufacturing has declined 42%. The sad reality is that these unskilled jobs are competing with cheap labor offshore and in order to remain competitive manufacturers must lower the cost of production. What seems to be ignored by the unions and the politicians is that even though the management costs, transportation costs, and tariffs are added to the total the overall cost is still lower than the cost of production is in the US. This should be a wake-up call that the status quo cannot be sustained.

But skilled labor seems to be doing well. The construction industry shows a growth of 31% since 1996 and as does Professional and Business Services. The High School Drop-out or those individuals who expect to join the union and get a “good paying job” are in for a disappointment because those are the jobs that are moving overseas. This doesn’t mean that everyone must have a college degree but it does mean that those “good paying jobs” will require some skill. However, for those willing and able to increase their skills through professional education, there are many opportunities and not all of these require an engineering degree, for example Home Healthcare Services shows a 537,100 forecasted growth in employment with a projected annual growth of 5.4%. Even the Entertainment Industry shows a modest growth in job opportunities and even though these jobs may not require a high level of education they do require a level of skill.

Clearly the impact of the Global Economy is reverberating throughout the industrialized world. The Socialist Economies of Europe are being hard hit because employment has always been one of their objectives. Ironically these countries have high unemployment rates and are struggling to retain the jobs they have. The situation in Europe is an example of what happens when the government attempts to “create jobs”. The government does not produce anything so there are few options available. They can hire people directly and increase taxes, which is never an attractive option to politicians – unless of course they are taxing the rich (meaning employed to most liberal politicians). They can increase corporate taxes, which is always a popular choice but even the densest politician knows that this not only slows the economy it usually increases unemployment. But then there is always the Socialist Solution – the one so frequently used by South Americans and Europeans – and that is to seize private businesses and nationalize them. This guarantees employment but it never provides efficiency or profits and in the extreme you have the Soviet Union and we all know how well that worked.

The Global Economy is having a huge impact worldwide as the labor force undergoes realignment and this will result in some collateral damage in the form of individuals who reject the idea of retraining or career changes. The reality is that there are many new jobs being created by industry but only for those flexible enough to change.

Progressive Thinking An Oxymoron

The morning paper always brings indications that the Neo-Marxists, now called Progressives, simply don’t understand economics, politics, or people. They continue their attacks on that moron in the White House, without actually specifically describing his failures and attributing his successes to the invisible and not so invisible puppet-masters. But their lack of thinking and understanding go far beyond this because they simply cannot give up their commitment to individual “rights”. Among these rights we find the right to hold a job – not any job but a job that pays a “living wage”. Presumably what this means is that these narco-illiterates must be given jobs that allow them to continue supporting their various offspring, keep up their child support, maintain their drug habits, and keep a roof over their heads. Therefore, it is time to raise the minimum wage apparently on the assumption that these minimum wage jobs should allow for the foregoing.

Then we find the right to an education. Of course for most of us taxpayers, we think that this right already exists. The public schools are available to everyone but of course you have to actually attend the classes. These means getting up early, catching the bus, going to class, and actually listening to what is being taught and of course – doing the work. Unfortunately, that four letter word “work” keeps appearing and those people, who were raised on the progressive ideas of entitlement, work never enters the equation. After all – what was the purpose of affirmative action? The whole idea was to provide the “minorities” with an equal opportunity to get an education at a prestigious university, without actually doing all of the work to either get there or stay there. Fortunately the alarm has been sounded within the minority community and while the progressives continue to beat the drum of racism it is sounding more and more like a dirge and less and less like a call to arms.

But to return to the morning paper, we find that the union movement is spending most of its time and money on political causes – causes generally not supported by the membership – and less and less on organization and recruiting. Naturally the real issue here is the anti-labor Republicans are in power and everything must be done to return the progressives to power. However, when you read the fine print, it seems that the overly generous benefits garnered by the unions, is killing jobs. It seems that the UAW members pay only 7% of their healthcare costs while the average American pays 32%. The Japanese auto manufacturers have approximately $1400 in profit in each vehicle with $400 going to healthcare. General Motors has only $700 in profit in each vehicle with $1000 going to healthcare. Of course nothing is said about the featherbedding and counterproductive union rules that keep excess employees and slow down the manufacturing process and even less is said about the declining membership which is driven by the declining number of jobs.

The progressives cannot give up their idea of rights and the responsibility of the government to redistribute wealth more equitably. Essentially these neo-Marxists, which is what they are, think that those people who worked hard, who attended school, who got an education or training that prepared them for the workforce, are obligated to share what they earn with the “less fortunate.” How I hate that term because the implication is that those who worked hard some how “got lucky” and got a good high paying job, while those who slacked off in school, who failed to get an education, who had multiple children they couldn’t afford, and who are too lazy to fix the situation, deserve to share in the wealth generated by the hard worker. This idea of wealth redistribution is called ‘progressive taxation (ironic or honest terminology -??)” and masquerades under the banner of “equality”. Of course the actual term is “egalitarianism`” which is the cornerstone of Marxism, but the Progressives really expect to take your money and redistribute it, not theirs. They are truly the embodiment of Orwell’s Animal Farm – where some Pigs are more equal than others.