DETROIT – Festering animosity between the United Auto Workers and Southern senators who torpedoed the auto industry bailout bill erupted into full-fledged name-calling Friday as union officials accused the lawmakers of trying to break the union on behalf of foreign automakers.
The vitriol had been near the surface for weeks as senators from states that house the transplant automakers’ factories criticized the Detroit Three for management miscues and bloated UAW labor costs that lawmakers said make them uncompetitive.
But the UAW stopped biting its tongue after Republicans sank a House-passed bill Thursday night that would have loaned $14 billion to cash-poor General Motors Corp. and Chrysler LLC to keep them out of bankruptcy protection. The Bush administration later stepped in and said it was ready to make money available to the automakers, likely from the $700 billion Wall Street bailout program.
Still, autoworkers remain angry with the senators who tried to negotiate wage and benefit concessions from the union, then scuttled the House-passed bill that would have granted the loans and set up a “car czar” to oversee the nearly insolvent companies and get concessions from the union and creditors. Their top targets were Senate Minority Leader Mitch McConnell, R-Ky.; Sen. Bob Corker, R-Tenn., who led negotiations on a compromise; and Sen. Richard Shelby, R-Ala., who has been a vocal critic of the loans.
Kentucky, Tennessee and Alabama all house auto assembly plants from foreign automakers, and union officials contend the senators want to drive UAW wages down so there would be no reason for workers at the foreign plants to join the union.
“They thought perhaps they could have a twofer here maybe: Pierce the heart of organized labor while representing the foreign brands,” UAW President Ron Gettelfinger said at a Friday morning news conference in Detroit.
Republicans in several Western states – where unions are often shunned – joined the Southerners in opposition.
But lawmakers and their spokesmen said the criticism is off base. Jonathan Graffeo, Shelby’s spokesman on the Senate Banking Committee, said the senator has consistently opposed taxpayer-funded bailouts.
“He opposed the Chrysler bailout in 1979 when there were no foreign auto manufacturers in Alabama, and he opposed the recent $700 billion bailout of the banking industry,” Graffeo said.
“Bailouts generally don’t work, and this is a huge proposed bailout, and I fear it’s just the down payment on more to come next year,” Shelby said on the Senate floor Thursday night. “These companies are either already failed or failing, and that’s a shame. These aren’t the General Motors, Ford and Chrysler I knew.”
Corker said the alternative he tried to develop would have provided federal money in exchange for restructuring the companies’ debt and making the UAW more competitive in wages with workers at U.S. plants of Japanese competitors.
“Our members wanted to know that the UAW was willing to be competitive,” Corker said.
“I basically pleaded with them to give me some language by some date certain that they were competitive with these other companies,” Corker said. “That’s where it broke down.”
Hourly wages for UAW workers at GM factories already are about equal to those paid by Toyota Motor Corp. at its older U.S. factories, according to the companies. GM says the average UAW laborer makes $29.78 per hour, while Toyota – generally viewed as the main competitor of the Detroit Three – says it pays about $30 per hour. But the unionized factories have far higher benefit costs.
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