# What was the point of bailing out GM..starting to move production out of Oshawa



## carverman (Nov 8, 2010)

Is this the beginning of a slow exodus of GM production out of Oshawa? 



> General Motors is moving production of the next version of its Camaro sports car from its Oshawa operation in Ontario to a plant in Michigan, a move the union says will cost 1,000 jobs at the massive factory east of Toronto.
> The Canadian Auto Workers estimated the move, which could also affect parts companies, could cost as many as 9,000 jobs in the region after all the spinoff affects are included.





> Ottawa and Ontario contributed $13.7 billion to help bail out North American automakers GM and Chrysler more than three years ago and combined own about nine per cent of GM's common shares.
> In its most recent deal with GM, the CAW agreed to a plan that would see new employees take longer to reach the top of the pay scale as well as receive a hybrid pension plan.
> The deal will also GM commit to creating, maintaining or extending 1,750 jobs.


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## sags (May 15, 2010)

Michigan just passed their "right to work for less" law. 

GM is heading to the promised land, where they can employ desperate serfs to do the work for minimum wage.


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## lonewolf (Jun 12, 2012)

The unintended consequences of minimum wage is taking away of jobs that are worth less then minimum wage. If someone wants to work what right does the goverment have stopping someone that wants to work? If a job is only worth x amount to a company they will only pay x amount to do the job or else the job will be eliminated. The goverment always seam to make matters worse. The goverment is not effecient & when it tries to create jobs it fails because the economy only has x amount of energy & as the goverment jobs increase the efficent private sector becomes smaller.


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## doctrine (Sep 30, 2011)

I believe the condition of the bailout was that they maintained 16% production in Canada as compared to the US. Although they're moving this shop out, because of increased production of other lines, they are still maintaining that 16% balance.


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## carverman (Nov 8, 2010)

sags said:


> Michigan just passed their "right to work for less" law.
> 
> GM is heading to the promised land, where they can employ desperate serfs to do the work for minimum wage.


I heard about that. You don't have to belong to a union to work in a factory in Michigan now. 
Maybe this was a timely decision by GM to start moving their production out slowly out of Canada, and avoid the unions, where they can, as you say, pay the hourly workers less..thereby maximizing their profit.
The other reason could be the return to "Made in America" policies to help their depressed economy by
hiring workers that will work for less with reduced pension benefits, since the UAW pensions are a huge
liability for them. 

A while ago, during the election, Romney mentioned about Chrysler moving the
production of the Jeep to China, but that was hushed up quickly.


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## andrewf (Mar 1, 2010)

Romney was hushed because he made it up. He was lying. And Chrysler doesn't like it when a politician lies about something they are doing that would hurt their brand.

GM is moving the Camaro to consolidate all of its rear wheel drive products in one plant. They just finished adding a shift in Oshawa. How about we take off the tin foil hats.


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## carverman (Nov 8, 2010)

Ok, I'll remove my tin foil hat...doesn't fit my swollen head anyway.:biggrin:

I just hope you are right about the changes. Because in the past they have made some changes that 
affected a lot of workers in the region afterwards. 

I remember that not that long ago when the Camaro was made in St.Therese QC? 
http://en.wikipedia.org/wiki/Sainte-Thérèse_Assembly


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## sags (May 15, 2010)

So people don't want to be forced to pay union dues, but still want to work in a union shop?

Do they expect to earn union wages...........or will they be negotiating their own contracts?

How do they think the dues paying union members are going to interact with them?

I suspect the next thing we will be hearing about, is some of those anti-union employees whining and crying that the union members don't want to be their friend.


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## andrewf (Mar 1, 2010)

It's been my experience that hardcore union types are not very friendly to outsiders of any kind. But then, a lot of that has been as a 'suit' at a big company. They just assume that you are out to screw them. Funnily enough, among non-union employees the environment is much more collegial. No one begrudges other people doing a good job, or complains about others pitching in to ensure the organization succeeds.

I guess it should come as no surprise that when you are part of a group that is extracting unearned rents from society, the rest of society is necessarily an enemy.


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## Daniel A. (Mar 20, 2011)

Non-union workers have much too fear in that the moment the boss decides your not on his or her team your as good as gone.
Witness the rules around company Christmas parties who wants to be working Jan. 2 

The only way to work in a non-union environment is with a contract something most managers have when they accept the job.

No different than union workers so the suit wants a signed contract why not just trust the company that offered a job.

Low level workers in non-union places don't have the protection of a contract like the bosses.


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## sags (May 15, 2010)

I don't get this part Andrew............

_I guess it should come as no surprise that when you are part of a group that is extracting unearned rents from society, the rest of society is necessarily an enemy._

What is a union, but a collection of employees banding together to present a stronger negotiating force to the employer?

In order for the union members to avail themselves to the same professionals (lawyers, accountants, economists) as the employer has at their disposal, they submit dues to pay for it.

People talk about unions as if they are somehow disassociated and distinct from the employees, which simply isn't true.

The members ARE the union. It isn't teacher "unions" that are on strike...........it is the teachers themselves.

Right to work laws are presented in a dishonorable way. The proponents claim it is freedom from the requirement of joining a union and paying dues, but they never disavow the myth that even without the unions in place........the wages and benefits will remain the same. Freedom for employees isn't even a consideration by business who push for right to work laws. Lowering their bottom line cost of labor is the only factor they consider.

Daniel A brings up a good point about consultant and management contracts. If they don't trust business to honor their commitments, why should hourly employees be any different?

And then there is the low end of the scale..........temporary workers who are forced to sign a contract with a temp agency if they want the job. A contract that specifies the employee has no rights or benefits, and will donate a portion of their income to the agency..........simply for offering them a job.

How is that any different than a city Mayor requiring kickbacks for a company to get a public works contract?


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## HaroldCrump (Jun 10, 2009)

sags said:


> What is a union, but a collection of employees banding together to present a stronger negotiating force to the employer?
> People talk about unions as if they are somehow disassociated and distinct from the employees, which simply isn't true.


What is wrong is that a small minority are allowed to gang up against, and blackmail, the vast majority of workers.
Unions are not workers against evil, blood sucking corporations.
Unions are a small, privileged band of workers ganged up against the rest - fully aided and abetted by the politcians and legislators they have in their pockets.

Nowhere is this more apparent than in the case of public sector unions.
That is a case of a small % of workers (say, 18% of working population, give or take) ganged up against the rest of the tax paying workers.

It is not the Marxist-Leninist proletariat standing their ground against the evil bourgeoisie.
It is a small set of workers pillaging the pockets of the rest.
It is a tug of war between two different groups of workers, who are really no different than each other.


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## sags (May 15, 2010)

I don't recall in 40 years ever hearing of a group of union members plotting against another group of workers. 

I do remember the many times the expertise, paid for by the union members dues, was made available to workers who had been unjustly terminated, encountered problems with workers compensation or unemployment, or needed participation in a charitable donation drive, such as the $500,000 donated by union members at CAMI to the local United Way.

Unions extend far beyond their own boundaries to help other workers and people in general.


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## sags (May 15, 2010)

Some people are disgruntled with public service wages and benefits, but their anger is directed at the wrong place.

Everyday there is another story of yet another corporation committing fraudulent, illegal, or morally corrupt acts.

Payoffs, bribes, fraudulent accounting practices, insider trading, dumping toxic waste, transferring the same rail cars across the border to gain carbon credits,......the list goes on and on.

The stories are only what is discovered. There is much yet to discover. The greed and avarice of corporations knows no bounds.

Business starts with all the power. Through contract bargaining, unions can only chip away at the rights of business.

As Amanda Lang said on a CBC panel the other night..........since corporations are sitting on all that cash and can't find ways to deploy it to create productivity gains........why not disperse some of it to their employees?

Why not indeed?


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## andrewf (Mar 1, 2010)

My experience with unions is not really a matter of pay, but of work rules that force businesses to be operated inefficiently. Role A can't trespass on Role B's responsibility. Net result is added cost, but no one benefits. It's pure waste. They also tend to create environments that reward mediocrity, by prohibiting meritocratic promotion or pay increases. Unions hold back the better performing workers and reduce the incentive to perform. Underperformers stick around even though unemployed workers out there might be better matches for the role.

Most workers are not members of unions. Private sector unions generally extract rents from the rest of society by driving up consumer prices. For example, car companies that used to be exclusively unionized. Result? Terrible, overpriced cars. Enter the non-unionized Asian makers with affordable, well-made cars to break the union monopoly. There are many industries where barriers to entry are high, thus it is possible for unions to hijack a business to extract unearned wages from consumers and investors. New investors are wary of creating competitors, because unions will similarly hijack their firms.


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## andrewf (Mar 1, 2010)

sags said:


> Some people are disgruntled with public service wages and benefits, but their anger is directed at the wrong place.
> 
> [...]
> 
> ...




Why not indeed, comrade. Can we confiscate your pension first?

One (anecdotal) wrong does not justify another. The proper response to misdeeds by corporations is stonger penalties, not unearned hand-outs.


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## andrewf (Mar 1, 2010)

And just like unions are not purely separate from their members (though there is an agency problem--the union elite does not perfectly represent the average member), corporations are not separate from the retirees, grandmothers, pension funds, charities, endowments, etc. that own them. When people advocate confiscating corporate assets, they are really taking wealth away from millions of retail investors.


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## sags (May 15, 2010)

Yes......and all those workers in non union shops enjoy the benefits of bloody union battles fought long ago.

I would take the history and legacy of unions over that of corporations any day.

You say to raise the pay of the workers would be equivalent to "unearned handouts", when the reality is those workers are the ones whose work earned the money for the corporation.

It certainly wasn't earned by the talking head CEOs that visit BNN and the country club.

Although I disagree with you, you do make well reasoned arguments Andrew............


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## andrewf (Mar 1, 2010)

Without corporations (limited liability shared ownership companies), we would not have seen much of the progress we've seen over the last few centuries.


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## HaroldCrump (Jun 10, 2009)

sags said:


> I don't recall in 40 years ever hearing of a group of union members plotting against another group of workers.


You don't have to go that far back.
Let's go back to this week, or last week, or last year.
The "plotting" in the case of public sector unions like the CUPE is because a very small % of workers are negotiating and using heavy handed techniques against the rest.
The govt. in this case is merely an illusion - it is the unionized workers bargaining against the non unionized ones.
The ever increasing concessions extracted by the unionized workers are extracted from the hard-earned wages of the non unionized tax payers.
The latter being no less skilled, no less educated, and no less deserving than the former.

It is bizarre that the union members and their supporters fail to acknowledge this.
They are not bargaining against the evil bourgeoisie.
They are simply bargaining against their fellowmen.



> Unions extend far beyond their own boundaries to help other workers and people in general.


Like how?
By volunteering in the soup kitchen?


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## sags (May 15, 2010)

You will get no argument from me that unionized workers have better wages and benefits than non union workers, which is why I would advocate for more people belonging to unions, if the goal is for more people to share in the distribution of wealth.

The formation of unions helped establish the middle class. As unions have declined, so have wage improvements, defined benefit pension plans, and other benefits.

The "wealth gap" continues to grow.

Even the most ardent supporters of capitalism understand the pendulum can only swing so far without causing serious disruptions for the economy. Consumer spending driven economies require consumers with money to maintain and grow.

Look at the US today. Both political parties recognize they can't afford a return to normal tax rates for the middle class, and the debate is over collecting more from those who can still afford it, or cutting services and benefits.

If the middle class hadn't been so gutted............they wouldn't be having this debate.


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## sags (May 15, 2010)

_*Like how?
By volunteering in the soup kitchen?*_

Yes, they volunteer in soup kitchens, as well as support many other causes.

My father spent the last few weeks of his life in a wonderful hospice, which is staffed by VON and volunteers, some of whom are CAW union members.

Unions are big supporters of such things as shelters for abused women and other socially responsible agencies.

They also allow staff, trained in women and child advocacy, workers compensation and unemployment issues, human rights issues, offer their services to people outside of the union membership. 

The CAW has defended female employees terminated by employers because they were pregnant and couldn't work the overtime hours demanded of them. (as an example)

The CAMI workers raised $500,000 for the local United Way campaign. This happens all across the country.

Gate collections and charity drives are common events.

Unions offer free education on various topics to non union shops.

Unions run national campaigns on social issues, such as workplace pensions, CPP enhancements, and health and safety issues.

Unions support, financially and with manpower, political parties and candidates who support the cause of working people.

There is far more activity going on within unions, than the often public battles between employers and the union every few years.


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## sags (May 15, 2010)

If we are going to talk about unions and socialism.............let's also put it into context.

The US is now totally dependent on government intervention..........but that isn't evil socialism............oh no.

The top three reasons given by an analyst why stocks will move forward in 2013...............

1) The Fed stating they will intervene in the US economy forever if needed.

2) The ECB announcing unlimited government funding support for Spain and Italy.

3) The Bank of Japan set to intervene in the economy.

It would appear that unfettered capitalism can't survive without socialism.


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## sags (May 15, 2010)

There is one bright side to the right to work laws...............

Perhaps unions won't have to accept everyone the company hires as a member.

As any plant floor level union representative will tell you.................

They spend 90% of their time dealing with problems created by 5% of their membership.


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## leoc2 (Dec 28, 2010)

sags said:


> They spend 90% of their time dealing with problems created by 5% of their membership.


Most teachers have the same problem as a union rep.


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## GoldStone (Mar 6, 2011)

Andrew and Harold, you are wasting your time arguing with sags and his ilk.

_“It is difficult to get a man to understand something, when his salary depends on his not understanding it.”_

-- Upton Sinclair


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## Nemo2 (Mar 1, 2012)

Bill Whittle touches on unions, their future, and the direction of government, in this video, (after the ~ 1 minute spiel, if you're unlucky enough to get it):

http://www.pjtv.com/s/GEYTGMBS


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## Jungle (Feb 17, 2010)

I think the negatives of unions outweigh the positives. Andrew mentioned above that there is no incentive to perform in a union, so people can become very lazy and lower productivity. 

If we let capitalism and competitive place everyone where they are needed, companies can run more efficient- they could then expand, hire and create more jobs. Instead we have unions that have waste and are not competitive anymore.

The world has changed and is more efficient IMO.


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## HaroldCrump (Jun 10, 2009)

sags said:


> If we are going to talk about unions and socialism.............let's also put it into context.
> The US is now totally dependent on government intervention..........but that isn't evil socialism............oh no.
> It would appear that unfettered capitalism can't survive without socialism.


The US is not unfettered capitalism, and hasn't been since the early 20th century.
The US is what is known as _State Capitalism_ i.e. capitalism by the state.
This system is characterized by a close cooperation between large monopolistic businesses and the government to achieve common goals.
The common goals being the preservation of the monopolies of the various corporations on one hand, and the maintenance of the status quo political system on the other hand.

Anyhow, inefficient unions in the private sector do not concern me as much.
andrewf pointed out several drawbacks of that kind of setup.
However, that problem ought to take care of itself in the marketplace i.e. inefficient organizations will lose out to efficient and agile organizations.

Market forces ought to take care of that - unless, such organizations exert an overbearing influence on govt. (i.e. tax-payers) and get them to bail them out approx. every 10 years or so.
For example, the auto companies, the airlines, the large steel corporations in the US north east, etc.

Like a well rehearsed ritual, they come, cap-in-hand, to the tax payers approx. every 10 years shedding crocodile tears about jobs and middle class and American values and get the tax payers to bail them out.
Rise and repeat.



> Yes, they volunteer in soup kitchens, as well as support many other causes.
> Unions offer free education on various topics to non union shops.
> Unions run national campaigns on social issues, such as workplace pensions, CPP enhancements, and health and safety issues.
> Unions support, financially and with manpower, political parties and candidates who support the cause of working people.


So do many non-unionized folks.
Unions benefit their own members (and even that is arguable) at the expense of the rest of society.

This is esp. true in the case of public sector unions because there is no free market to weed out inefficient corporations, as in the case of private sector organizations.
The public sector unions, like the CUPE, are a tax grab and income re-distribution mechanism to appropriate from non unionized tax payers and allocate to unionized workers.

All it has done is create a two-tiered society - the Haves and Have-Nots in the workforce.
There is no need, and no rational justification, for having unions in the public sector.

As for private sector unions, if only we can somehow stop bailing out those corporations, that problem will resolve itself natually over a period of time.


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## sags (May 15, 2010)

Public sector employees work for the government directly, or school boards, hospitals, municipalities.......many employers.

Taxpayers aren't the employer, anymore than a customer of Walmart is the employer of it's employees.


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## Rusty O'Toole (Feb 1, 2012)

What frightens me is how short sighted unions are. I can understand being self centered and greedy. What I don't understand is killing the goose that lays the golden eggs.

Would it have been possible to save the auto industry, and many other industries, if unions had take pride in their work and in themselves? If they had said, we want the best wages and working conditions because we are the best most efficient workers? Give us what we want and we will cooperate with our employers to make the best products at the lowest cost? It might not have prevented foreign competition from coming in but it could have prevented them from taking over so much of the market.

And what about the public sector unions in the US? All over the country cities and states are facing bankruptcy because they can no longer afford the high pay and gold plated pensions of their union contracts. This was totally predictable but politicians and union leaders happily signed contracts that anyone who could do math, knew could only end in disaster. How is this good for the union member, the private citizen, the city or the state?

It reminds me of the Australian auto worker's union that deliberately drove British Leyland into bankruptcy in the seventies. British Leyland was the third of Australia's Big 3 auto makers, after Ford and Holden (GM). Everyone knew they could not afford a big wage increase let alone a strike, but the union struck anyway and the company went under.

Afterwards a reporter asked the head of the union, "How could it possibly benefit your members, to have a third of the industry shut down their plants?"

The answer, "Can you imagine the power this will give us over Ford and Holden?"

Actually it gave them nothing, in fact made their position worse. The Japanese had been trying to get into the Australian market for 10 years but progress was slow as they had to set up a whole new network of dealers one by one. All of a sudden, one third of the car dealers had nothing to sell. The Japanese swooped in, signed up all the ex Leyland dealers, and overnight Japan owned a third of the Australian market.

Good luck, Aussie union, negotiating with Japan.

How could anyone familiar with the auto industry, not have seen this coming? If they knew what the result would be, why did they shoot themselves in the foot?

The only answer I can think of is, that is the way they wanted it. They had been so dedicated to fighting the evil bosses for so long, anything that hurt them seemed a good idea. 

Well they won, just like the unions won in Detroit. And everyone knows what a success that was. No more fat bellied Capitalists in top hats and striped pants. No more dark satanic mills, no more smoke stacks belching pollution into the air. No more soul destroying assembly line jobs. The poor downtrodden workers are free to dance in the sunshine, to express their personalities and show us the best that is in them.

How is that working so far? Are Ralph Nader and his pals taking bows in downtown Detroit?


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## sags (May 15, 2010)

GM's failure wasn't due to the unions, which were with the company during it's record profit years as well as the decline, but management taking it's eye off the ball............ which is the reason they were in business.

When management made the decision, the returns on invested capital, would be far superior in the mortgage lending business, they proudly claimed "we are no longer a car company, but a mortgage company who just happen to build cars", the writing was on the wall.

Hugely profitable, when everyone with a pulse was able to finance a home, the losses in their mortgage business brought GM to it's knees.................much the same way it did to General Electric and many of the banks.

With huge losses mounting, GM made the decisions that guaranteed their demise.........they tried to shrink their business to prosperity. Budget cuts to research and development led to poor vehicle models, poor quality, and lousy service to their customers.

Bob Lutz was brought in to design and build a new car..........and the best they could come up with was the 2 seat Pontiac Solstice..........with no trunk and no licence plate holders......whoops.

By selling off Delphi, and other of their in house parts manufacturers, they destroyed the vertical integration that had served them so well for decades, but they needed the cash to shore up the mortgage business losses.

Unions have made mistakes, but they don't have a monopoly on poor business practices.

The roadway is littered with now defunct.....or severely troubled companies..............that don't have unions to use as a scapegoat.


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## HaroldCrump (Jun 10, 2009)

sags said:


> Public sector employees work for the government directly, or school boards, hospitals, municipalities.......many employers.
> Taxpayers aren't the employer, anymore than a customer of Walmart is the employer of it's employees.


Oh no, no, no, let this be very clear - the tax-payer is the employer and the customer, in each and every case of the above.
Each and every public sector worker that works for a tax payer funded organization is an employee of the tax paying public.
When they bargain against, and strike against, the "government", they are striking against their real employer - the tax payers.

As a recent example - the teachers' strike in the last two weeks is not a strike against some illusionary government.
It is a direct slight against those that pay for the public school system and send their kids to the schools.
As a result of the strikes, we had 2 school trips canceled.
Worse, we had the Christmas concert canceled, for which the students (and teachers) had practiced for several weeks.

So I am sorry to say this, but every unionized public sector worker is accountable directly to the tax payers.
Their militancy, their impudence, and their arrogance is a direct slight against those that work hard and pay taxes, so that a small handful of others can work and enjoy comfortable retirements.


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## Dmoney (Apr 28, 2011)

But government employees pay tax too... 
In fact, since government jobs pay so well, government employees pay quite substantial taxes...
In fact, we should substantially increase the number of government jobs, since that would really drive an increase in overall government tax revenues, and would reduce the burden on the private sector...


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## HaroldCrump (Jun 10, 2009)

Dmoney said:


> In fact, we should substantially increase the number of government jobs, since that would really drive an increase in overall government tax revenues, and would reduce the burden on the private sector...


I'll assume you were being sarcastic, because it won't work out that way.
All that would do is increase the % of govt. spending as part of the GDP.
It simply creates a spiral of more spending > more taxes > more govt. jobs > more spending and so on....
...until you become Spain...and then finally, Greece.


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## Dmoney (Apr 28, 2011)

Harold, give me more credit than that... Of course I was being sarcastic. 
But I have heard this argument used in complete seriousness, and defended... Always by those paid from the public purse.


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## bgc_fan (Apr 5, 2009)

HaroldCrump said:


> As a recent example - the teachers' strike in the last two weeks is not a strike against some illusionary government.
> It is a direct slight against those that pay for the public school system and send their kids to the schools.
> As a result of the strikes, we had 2 school trips canceled.
> Worse, we had the Christmas concert canceled, for which the students (and teachers) had practiced for several weeks.
> ...


I won't argue about accountability of unionized public sector workers, but with regards to the teachers' strike affecting school trips and events shouldn't this be expected? After all, with all the rhetoric about teachers working only 22 teaching hours a week which is what their union contract states, why should we expect them to work outside their contract? After all, no one seemed to give any consideration for after hours work.


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## sags (May 15, 2010)

Teachers are on strike to protest the implementation of Bill 115.

The bill is located at the link and clearly defines the employment relationship as between teachers and school boards.

http://www.ontla.on.ca/web/bills/bills_detail.do?BillID=2665


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## sags (May 15, 2010)

The frustration of those with a "cut taxes" viewpoint, is that it isn't supported by the majority of people.

Polls have always shown that given the choice between tax cuts or cuts to benefits and services.....people choose to pay the higher taxes.

The US election was a similar result, and while Republicans spend months pouring over dozens of theories........they refuse to accept a simple truth. The voters don't like the message of cuts and less services.

Everybody wants to pay less.....until it affects them.

They want the police to come when they call. They want their garbage picked up. They want their tax refunds on time. They want their Old Age benefits...........and they want those who aren't paying their fair share...........to pay up.

As noted by Warren Buffet..........the average tax rate among the top 400 income earners in the US is 15% .............and 6 paid nothing at all.

*That* type of unfairness is what people want addressed, not quibbling over who gets the crumbs that fall on the floor.


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## HaroldCrump (Jun 10, 2009)

But sags, we are not talking about tax cuts here.
The tax rate paid by Warren Buffet is irrelevant to this discussion.

My point is about the two-tiered system created within the labor force by the unions - pitting one worker against another.
The unions have created a dual class labor structure.

And speaking of taxes, the public sector unions provide no benefits for the tax payers.
They siphon off value from the system and are essentially rent seekers.
We are in a vicious spiral of having to pay more and more in taxes to keep appeasing these impudent unions.

Where does this spiral of taxation end?
I do not see how paying them more and more is giving us any better services.
What level of annual pay raises, pensions, and benefits are required to keep the white elephant happy?


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## sags (May 15, 2010)

No doubt there is a growing gap between the wages of public and private workers.

As I see it, the gap has been created when private wages have not kept up with the steady increases unions have been able to negotiate on behalf of their members.

The debate could also be that private workers have not received fair treatment, given their wages have been stagnant for a long time, while productivity gains and corporate profits should have created the ability (if not the will), to provide higher incomes for employees.

I witnessed this happen with my own salary, which started out about even, or only slightly above, other manufacturing wages............and then rose rapidly primarily due to regular cost of living increases through the years.

Employees without the benefit of cost of living adjustments, had their standard of living constantly eroded.

The question is then...........how to fix the problem.

My contention is eliminating unions, and forcing public sector wages downward...........will not help those whose wages have stagnated to the point that they became dependent on debt to pay their bills.

It will only make a bad situation worse.


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## Dmoney (Apr 28, 2011)

Whether public wages fall or private wages increase, the effect is the same.

If private wages rise, prices increase, goods/services become more expensive relative to public wages, private wages have now kept up.
If public wages fall, in theory (good luck with this) taxes would fall, private sector would be relatively better off, public would be relatively worse off.

The only thing that matters is the relative wage, and right now it's off kilter. Over the past few decades, the public sector has gained at the expense of the private sector. The only option going forward is for the private sector to gain at the expense of the public sector. 

I think it will be near impossible to close the gap because of unions who aren't willing to give any ground. Any gains the private sector makes will be fought for by the public sector unions, and they will get it. Any temporary freezes will be more than made up for with future raises.


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## kcowan (Jul 1, 2010)

In the beginning, they were going for wage parity with the private sector. Once that was achieved, they dropped that mantra and then just kept going, relying on the fact that their employers were not fiscally accountable. That is the fundamental problem with public sector wages. No one is accountable for the costs.

It will only end with bankruptcy of the state.


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## sags (May 15, 2010)

There are many more layers than "two tier" economic classes, even within the "working" class.

Everything from heads of administration, which often show up on "Sunshine" lists earning over $100,000 per year, and often well over $100,000 per year........such as Judges ($250,000 per year), hospital administrators, crown attorneys, high ranking police officers...........etc.............all the way down to the housekeeping and kitchen staff at hospitals who earn $35,000 per year...........which is less than the median wage in Canada.

There is a great difference in wages and benefits among members of the public service, and the unionized workers wages are most often at the bottom rungs of the pay ladder. A unionized bus driver or school teacher doesn't earn anywhere near the salary levels of the layers of non union administration above them.

In discussions of the public service, it often revolves around blaming the unions.........when in fact the highest salaries in the public service are reserved for non union positions.

Unions make a handy target........and a diversion from where much of the cost of the public service is actually being spent.

Countless newspaper articles dissing union workers........and not a word about the highly paid administration in the public service.

The same political hacks who point the finger at unions.........are themselves shamelessly feeding at the public trough.

But to them...........that is different. They are special. They are worth it.

I sat in court one day, and listened to a highly paid Judge, who had been a former teacher and MPP, ridicule a young man who said he wanted to start his own business. "You have no money" laughed the old Judge.........who had fed off the public purse for her whole life.

But she felt superior. She was above all the hardworking people who entered her courtroom.

She is retired now..........well, sort of..........

She gets called in when Judges are absent, which is often it seems, and earns more in one day than many people earn in a week.

If savings are necessary.........how about we start at the top for a change.......instead of picking on people at the bottom?

Maybe management could set the example........starting with politicians and work on down the list from there.


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## HaroldCrump (Jun 10, 2009)

Dmoney said:


> I think it will be near impossible to close the gap because of unions who aren't willing to give any ground. Any gains the private sector makes will be fought for by the public sector unions, and they will get it. Any temporary freezes will be more than made up for with future raises.


The problem in this case is mostly political.
In an apolitical environment, this problem will be self-correcting.

Unions will have collective bargaining rights, and the tax-payers will have equal rights to not emply the unions i.e. procure labor from the free market.

However, because of vote bank driven politics at all 3 levels of govt. this is not possible.
Thus, public sector unions are able to enjoy their free ride at the expense of the other equally hard-working, tax-paying, non unionized workers.



sags said:


> Everything from heads of administration, which often show up on "Sunshine" lists earning over $100,000 per year, and often well over $100,000 per year........such as Judges ($250,000 per year), hospital administrators, crown attorneys, high ranking police officers
> The same political hacks who point the finger at unions.........are themselves shamelessly feeding at the public trough.


I agree with you, sags, in this case - it is an outrage.
The sheer number of paper-pushing bureaucrats on the "Sunshine" list, and what they make at the expense of the tax payers is shameless.
This whole sector is corrupt, decaying, and out of control.

We need a comprehensive rationalization of the pay, benefits, and pensions in the entire public sector.
As *Dmoney *said above, the public sector compensation in totality has to come way, way down.
Yeah, I know, good luck with that.

When the vote banks of Ontario elect people like Dalton McGuinty for not one, not two, but three consecutive terms, we know how hopeless change is.

But let's not let the outrageous compensation of non unionized paper pushing bureaucrats dissuade us from the fact that unionized public sector is pillaging the wallets of tax payers.


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## sags (May 15, 2010)

Best be careful we don't agree with each other too much Harold...............lol

But, I found this statement by you interesting.........something I hadn't considered...........and would probably agree with as fair and balanced.

*Unions will have collective bargaining rights, and the tax-payers will have equal rights to not employ the unions i.e. procure labor from the free market.*


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## andrewf (Mar 1, 2010)

This is what we were talking about originally wrt right to work legislation. No one is going to ban unions or prevent workers who want to form a union from doing so, only taking away their monopoly power to force people to join a union as a condition of employment. Monopolistic unions like CAW or public sector unions, which stifle competition, are a cancer on society.

sags, we could double everyone's salary tomorrow, but it wouldn't change anything. Relative income is a zero sum game. You can try to change the distribution of income--I am not opposed to that. But, we should do it in economically efficient ways--ways that cause the least harm to the economy (in terms of deadweight losses--no one gets to eat the slice of the pie because it gets tossed in the garbage in the process of redistributing).

Unions are not an efficient way to reduce income inequality. They tend to disproportionately benefit the few at great cost to the many, especially in a globalized world. High consumption taxes and highish income taxes on the wealthy with transfers to the poor and lower middle class (in terms of $$ or social services like subsidized health care and education, infrastucture, etc) is a good way of reducing income inequality. Corporate taxes should remain reasonably low as there is little sense in discouraging business from investing. And corporations aren't people, and don't consume, so for corporate profits to flow to private individuals, they would be caught through income taxes or withholding taxes (if they are foreign taxpayers). It's a good thing that rich people invest money rather than consume it. We all benefit from productive economic investments.


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## sags (May 15, 2010)

I would have to disagree with you on the right to work legislation, Andrew.

Introduction of the legislation is not to empower employees, but an attempt to weaken and destroy unions.

If............the laws stated that an employee doesn't have to join a union..............AND is not entitled to wages, or benefits negotiated by the unions..........nor entitled to any services offered by the union.........then it may be a fair deal.

But listening to interviews after the Michigan vote, the premise is that an employee can work in a unionized setting, enjoy all the benefits of belonging to a union, and enjoy all the rights as the union member to have the union represent them (and the union would be required by law to represent the employee)..............but have the right to refuse to pay the dues necessary to sustain the union........or even to contribute to the services they are using.

That being the case........these people want to "free load" off others.

Unions have played a role in redistribution of wealth, but I agree there are much more efficient and preferable ways to accomplish that.

The problem is nobody in particular, either corporations or governments, seems particularly interested in doing anything about the growing wealth gap.

Wages have been stagnant, adjusted for inflation, since the 1970s......the rich get richer and everyone else gets poorer.

Just as higher and higher taxes would eventually bankrupt the economy.......the growing wealth gap will eventually have the same results.


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## sags (May 15, 2010)

In a fair world, employers would pay an honest rate of pay, provide the benefits they could afford, and keep their good employees...........but that is the way it used to be.............not the way it is now.

One can't have an overall discussion on unions, wages, or the decline of the middle class, without including a discussion on how employment practices have changed over the years...........and not for the better.

Temp agencies abound all over the country. Starting out as clerical replacement centres, they have expanded into everything from manufacturing to transportation jobs.

Part time hours, no benefits, split shifts, work cancelled 30 minutes before the shift begins, unreported injuries, and poor health and safety records are all common.

There are Tier II auto suppliers who have gone through every eligible person in their area, with the promise that "good" employees will be hired after 90 days, when in fact "everyone" is gone after 89 days. The companies cry the blues about not being able to find people willing to work and want to bring in "foreign workers", as the mine in Ontario did after bringing in 200 Chinese workers with the government's approval, despite having declined over 300 job resumes for undefined reasons.

The temp employees pay the temp agencies a "fee", often as much as 15% - 20% of their wages.......for the opportunity to work. That is tantamount to illegal kickbacks, as far as I am concerned.

Governments abide this...........because they don't want to ruffle the feathers of business.

If we address some of the perceived problems............such as unions with too much power and influence, we should also address the dark side of business.

A restoration of balance is needed, but likely won't happen until after economies collapse.


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## kcowan (Jul 1, 2010)

One of the problems is that we elected a party with its roots in the reform party to correct some of these inequities Yet when they got in power, nothing changed and some things got worse.


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