The Race To The BottomI popped over to read at BFP's place where she has a post titled, Why we should stop conflating the “big 3″ with “Detroit”. As always, it's an excellent post and you should go read.
Her first link is to a post Jill has up at Feministe, We shouldn’t bail out Detroit.
I'm in agreement with BFP that you can't conflate the big three automakers with Detroit, first of all. And that we do have to bail them out, secondly. What people who are making the argument that we should just let a huge industry fail don't seem to understand is that it isn't just the one company that will go under. There are suppliers, and suppliers to the suppliers, and so on down the line. All of these businesses will suddenly have less money to pay their bills and their employees, they will lay off workers who will suddenly not have paychecks, they may not be able to pay their bills.
-There will be more mortgage defaults
-There will be defaults on other consumer loans (charge cards, auto loans, etc)
-Physicians, eye doctors, dentists, go unpaid
-Less groceries are bought
-Will the electric get paid, can heating oil be bought, water bill, trash pick-up?
-Cancel the cable, cell phones, no more restaurants, no more movies and other entertainment, etc
In other words there is a domino effect. First it is the auto workers, then it's the suppliers, then it's default on all sorts of loans (banks start laying off), then it is the businesses and service industry (these businesses go under), and we keep going as more and more people are laid off and more businesses go bankrupt.
This is why it's not just Detroit, just because their main plants are there doesn't mean those are the only ones. My uncle retired from Chevy in Buffalo, he earned his pension and deserves every cent. There are plants and suppliers in several other states and hundreds of cities and towns. I worked at a plastics plant in Meriden, CT that makes parts for Ford.
Over at Feministe there was one comment that made me so angry that I had to post. It was this:
# Sarah says:
November 19th, 2008 at 7:24 pm - Edit
I think the post hit the nail on the head with the comments about healthcare. No other major car-producing countries have to provide their works with health care. Health care is, undeniably, a huge cost for any employer. Also, while I am not advocating pay cuts or the low wages of foreign workers, I do think that there are plenty of people in this country who are overpaid. Like another poster mentioned, even an unskilled worker is expected to be paid $50,000 a year. Why on earth…? The reason people are losing jobs to immigrants is because they are asking for $15 an hour to pick apples while the immigrants will do it for $5. That’s what the job is worth. Yes, I think that people should be paid enough to survive, but I think in some cases it’s a little extreme. I think one of the unpleasant and ugly truths is that everyone, even assembly line workers, is paid too much in American auto companies. Not everyone belongs in middle America, and as far as I’m concerned, with only a high school diploma, there’s no way anyone should be making more than $30,000 a year. Sound cruel? Then I wonder why other countries are flourishing. People need to be paid to work hard, not because the union says they need to be paid this much or that much.
This is why I titled the post, the race to the bottom. The conservatives have done a marvelous job spreading their anti-worker propaganda in order to see this kind of comment on a progressive blog. It also shows how dismal an American education is when people don't have the slightest clue about the history of labor in this country. We are headed right back to the 19th century, with the Carnegies, Vanderbilts, Duponts, and Rockefellers making millions while paying workers pennies with no benefits, 12-16 hr days, 7 days a week. Heaven forbid they want a living wage that allows them to own a home, a car, eat three meals a day, and have some enjoyment of life. No the greedy fuckers should be grateful with for whatever value their "betters" choose to pay, living 3 families to a apartment in a rickety tenement, with a loaf of bread to share amongst them for the day. Once the super wealthy have squeezed all usefulness from them and left them a broken husk they can just die. This was the way it used to be.
How about we consider something like...oh I don't know, maybe management take a cut from their hundreds of thousands to millions in pay instead, especially when the business is faltering? No fucking bonuses, stock options, or golden parachutes for top management when they drive the business into the ground?
And how about instead of lowering our standards to countries who do pay their employees pennies for a days work, we force them to raise their standards, or we don't do business with them or pay a tariff or surcharge for doing business with us. Fair trade instead of free trade, anyone? Instead of saying that union workers don't deserve decent pay and benefits, we say instead that all workers deserve decent pay and benefits. All workers deserve a chance at a better life.
But...I do agree with Jill that something has got to change, if it doesn't it is throwing money into a black hole. Since it's obvious the idiots running the big three won't do it on their own, make the bail out contingent on manufacturing what consumers want and need, fuel efficient and green technology. Tell them anyone who accepts the money must decrease their percentage of gas guzzling humungo vehicles and increase the percentages of both their smaller fuel efficient lines as well as electric, hydrogen, biodiesel, or other alternative lines.
One last thing, I'm not angry with Sarah for saying what she did. I am angry with conservatives for their anti-union, anti-worker, pro-corporatist, pro-uber-wealth propaganda. I am angry with the media and liberal politicians who aren't fighting back and calling it out for the bullshit it is. I am angry with our educational system that wants us to forget history and be mindless robots for the wealthy and powerful at our own expense.
Update: More on unions and the auto industry at Huffington Post.