Wednesday, September 19, 2012

Union members were made whole at the expense of non-union employees in auto bankruptcy

Fred Arndt and his brother Dave came to General Motors straight out of high school.
They spent their entire careers building the engine cooling systems that increase the lifespan of Cadillacs and other vehicles. Dave worked in assembly; Fred, one year younger, qualified for GM University, which propelled him to work as a draftsman and engineer. They worked the line side-by-side. Dave built the parts Fred had designed.
The brothers made their way to Delphi, an auto supplier spun off from GM that builds components—seats, instrument panels, steering and suspension systems—for cars.
After more than 30 years with the company, the brothers retired in their native Michigan. They watched as Delphi’s growing labor costs dragged it into Chapter 11 bankruptcy in 2005. It would not emerge until 2009 when the government stepped in with $50 billion for GM.
And then the Arndt brothers’ paths diverged. Fred, 64, lost his health, dental, and life insurance, along with 70 percent of his pension. Dave lost five percent of his health insurance and some dental coverage.
His pension, however, was made whole.
The difference: union membership. Dave is a member of United Auto Workers—the labor group that financially backs the Democratic Party. Fred was considered management.

Read more: http://freebeacon.com/the-delphi-debacle/

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