[This has a predictable tone, coming as it does from investors whose rights are privileged above other stakeholders--like employees. But it might leave Canadians wondering about the fate of their own auto industry bailout and that muscle car revival we've all been looking forward to. Note what IBD takes to be the reasons why the auto industry is in trouble. Not credit. Not the price of gasoline. Not peak oil or a disastrously toxic product. Certainly not the bulemic executive dreamworld. No. It's those damn workers. -jlt]
The government gave the Big Three a $17.3 billion bailout based on the idea that both management and the unions would make concessions. Now the UAW says no thanks. Can we have our money back?
| U.S. automakers are in trouble for two reasons. One, they have massive legacy costs on their books to take care of retired workers, and two, their labor costs are much higher than their competition. |
Last week's deal was supposed to hold both the managers' and unions' feet to the fire. In handing out the taxpayer money, the White House insisted the auto union cut worker pay roughly to the levels of their successful competitors, Toyota, Honda and Nissan.
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