Trust, willingness to cooperate needed in auto help debate

Published 6:00 am Monday, December 15, 2008

With Congress last week failing to approve legislation to helpthe ailing U.S. auto industry, President Bush is sending signalsthat help could come from funds originally targeted for financialindustry assistance. Controversy over public funds to aid privateindustry contributed to the assistance package’s failure inCongress.

While the help plans are no doubt controversial, a recent columnby Detroit Free Press columnist Mark Phelan addresses what he callsmyths that have fueled the fire against aid plans.

Citing criticism that the Big Three produce “unreliable”gas-guzzlers centered around SUVs and trucks while failing toproduce hybrid and more fuel efficient cars, the auto critic forthe Detroit newspaper points out that J.D. Power and Associatesstatistics rate the Big Three brands’ reliability and fuelefficiency as on par or higher than their foreign competitors. Healso points out that while they were slow to address futuretechnology, the U.S. automakers are quickly adding hybrid vehiclesto their product lines.

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A key sticking point in too much of the debate over the fundinglegislation are labor costs that put the automakers at adisadvantage to their foreign competitors. The newspaper columnistpoints out that the $70-an-hour figure is misleading because itfactors in the retiree pay of former workers that inflates thecurrent workers’ pay figures, which he says are actually closer to$48 including benefits for assembly line workers.

One can slice and dice expense figures but the fact remainsAmerican automakers’ labor and benefit costs when totaled togetherare higher than their competitors, which give the competitors aprice advantage.

The debate over assistance for the auto industry bears watchingbecause of the potential impact – both directly and indirectly – itcould have locally due to parts supplier Delphi being located herein Brookhaven.

Just this past week layoffs were announced for King’s DaughtersMedical Center due to losses from lower than normal bed counts atthe hospital. Citing economic conditions including cutbacks atDelphi as part of the cause of the hospital’s layoff, it is nothard to see that instability at Delphi has an effect on our localeconomy – not just at the hospital but at local businesses aswell.

There is no simple answer to the bailout question, for it isfraught with problems – problems that must be worked out withplenty of give and take between labor, management andWashington.

But somewhere in all of this we have to find mutual trust and awillingness to work together as one. At that point we can begindigging ourselves out of this economic mess.