Automotive Labor Unions Realize Need to ‘Tighten Belts,’ Hoyer Says

By Josiah Ryan | November 18, 2008 | 6:01pm EST

General Motors (AP Photo)

(CNSNews.com) – As the Big Three automakers lobby Washington for a $25 billion bailout, the automotive labor unions realize they also need to “tighten their belts,” House Majority Leader Steny Hoyer (D-Md.) told CNSNews.com on Tuesday.
 
But Hoyer declined to say what concessions the unions should make, or whether they should also submit to federal oversight, as some of the bailout legislation proposes for the management of the Big Three.
 
“Clearly, the unions themselves have recognized a need to tighten their belts,” Hoyer said when asked how much blame unions share in the financial woes of faltering automotive giants General Motors, Ford and Chrysler.
 
(CNSNews.com reported Tuesday that United Auto Workers union members make, in salary and benefits, $73.00 an hour. For contrast, Toyota plant workers in the U.S. make $43.00 an hour in salary and benefits.)
 
Congress, which is returning this week for a lame-duck session, is expected to grapple with legislation from the House and Senate that would provide the automakers with $25 billion in aid.

buy a car for her 18-year-old daughter, Kari Olson, left, Wednesday, Nov. 12, 2008, in downtown Los Angeles. (AP Photo/Ric Francis)

Some lawmakers want the bailout funds to be drawn from the $700 billion financial bailout while the White House said Monday it prefers to see loans allocated from existing funds at the Department of Energy. 
 
In September, Congress passed a bill to provide the automotive industry with $25 billion in loans to help re-tool and modernize factories. Another bailout-loan would bring the total to $50 billion.
 
House Financial Services Chairman Barney Frank (D-Mass.) said on CBS’ “Face the Nation” on Nov. 16 that if the government gives the automakers another $25 billion in aid, it must come with conditions for the company’s management, including a suspension of dividends for stockholders, "a very tough oversight board," and "no bonuses for anybody making more than $200,000 a year."
 
But, when CNSNews.com cited Frank’s comments and asked Hoyer if he thought unions ought to also be required to make concessions and, if so, what should those concessions look like, he said he did not want to get into the details of concessions but thinks the unions have already shown a willingness to negotiate.
 
“I am not going to get into what concessions or constraints ought to be placed either on management or on labor,” Hoyer told CNSNews.com in the press conference. “Clearly, the unions have already had some renegotiations. At this point and time it’s not as if they are saying [to the automakers], ‘You are in trouble and we are not going to do anything.’ They have already done some substantial things. Both sides have taken some steps.”
 
But on Tuesday, United Auto Workers (UAW) President Ron Gettelfinger testified to the U.S. Senate Committee on Banking that his organization rejects the idea that rank-and-file workers should make concessions on wages or retiree benefits under the bailout plan.
 
“We would also note that in the cases where the Treasury Department has acted to rescue financial institutions, it has only imposed restrictions on executive compensation,” said Gettelfinger in a statement prepared for the Senate committee. “It has never mandated cuts in wages or benefits for rank-and-file workers and retirees. Thus, there is no basis for singling out the auto industry for different treatment.”

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