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| Herb Adcox | |
State and national labor leaders criticized Sen. Bob Corker, R-Tenn., Friday for his hard-line stance in auto bailout negotiations while supporting government incentives to develop a foreign automaker in his hometown.
In a news conference, United Auto Workers President Ron Gettelfinger questioned the senator’s unwillingness to back a federal loan plan after he had helped negotiate hundreds of millions of dollars in state and local incentives to lure German-based Volkswagen to build a plant in Chattanooga.
“They use taxpayer dollars to subsidize our competition,” Mr. Gettelfinger said.
Sen. Bob Corker, R-Tenn., arrives for a news conference on Capitol Hill in Washington, Friday, Dec. 12, 2008. Corker, a key Republican negotiator, said the Bush administration undercut his negotiating power with the UAW by making clear from the start that the industry would get an emergency life line if talks with Congress collapsed. (AP Photo/Susan Walsh)
Sen. Corker said in an interview it was the UAW’s unwillingness to compromise on what he called “flexible” concessions that prevented a deal from happening. He said he asked labor leaders to commit to wage and benefit cuts by some time in 2009, but UAW officials would not budget from their proposed date of 2011.
“I wanted to make a deal,” Sen. Corker said. “All we wanted was, ‘Look, just tell me when. Give me a date.’ That was not possible to get to.”
Sen. Corker, a former Chattanooga mayor, countered criticism of his support of VW by noting that General Motors also received government incentives for its plant in Spring Hill, Tenn.
GOVERNMENT HELP FOR VW
City, county, state and federal governments have pledged to provide $577 billion worth of tax breaks, worker training and infrastructure improvements for the $1 billion Volkswagen plant in Chattanooga. The incentive package is the biggest among $3.58 billion of incentives provided for 20 foreign-based auto companies since 1980.
* Tax credits in current dollars* — $239.2 million
* Site preparations and infrastructure — $208.8 million
* Training and recruitment assistance — $81.2 million
* Land — $40 million
* Welcome center — $6 million
* Marketing — $2 million
Source: Good Jobs First, University of Tennessee Center for Business and Economic Research
Mike O’Rourke, president of UAW Local 1853 at the GM plant in Spring Hill, Tenn., accused Sen. Corker of “playing politics and risking the jobs of 110,000” people related to the automobile industry in the Volunteer State by opposing a $14 billion loan plan approved Wednesday in the U.S. House of Representatives.
The package was meant to address severe economic distress that could lead two of Michigan’s Big Three — General Motors and Chrysler — to bankruptcy in weeks. Officials at the third major automaker, Ford, have said their company’s situation is not as dire.
The Senate voted that plan down Thursday after the negotiations on Sen. Corker’s alternative proposal collapsed.
Area dealers respond
Local auto dealers noted that foreign automakers can’t flourish without stability in the domestic carmaking business.
“If either (GM or Chrysler) were forced to close, their volume that they buy from suppliers would affect the suppliers so much that he would have to (make cuts), and that would affect even the imports,” said Herb Adcox, owner of Herb Adcox Chevrolet in Chattanooga.
Mr. Adcox said he was encouraged to hear White House officials announce Friday that they are considering using some of the $700 billion Wall Street rescue package to help automakers. He said the automakers don’t need a “bailout” per se — just a temporary loan.
Clay Watson — who is president of Mountain View Ford Lincoln Mercury and whose family owns several other dealerships in town, including one that sells Chevrolets — said he remains optimistic, both for his sake and the nation’s, that a deal can be reached.
“I think some sort of plan will shake out,” Mr. Watson said.
Rick Ezell, general manager of Justin Dodge Chrysler Jeep Mitsubishi in Calhoun, Ga., said stipulations are necessary.
“I think the bailout has to happen, but I agree with Congress that you can’t just turn the money loose without protecting it,” he said.
“Apples to Oranges”
Local and state officials said Tennessee maintains deep ties with the auto industry and has good relations with domestic and foreign carmakers and their suppliers.
State Economic and Community Development Commissioner Matt Kisber said Gov. Phil Bredesen and administration officials have “worked closely with GM over the years” and noted the state has put a “significant amount of resources into helping retrain the GM work force in Spring Hill.”
The state recently has spent about $35 million retraining GM Saturn plant workers, the commissioner noted.
Chattanooga Mayor Ron Littlefield said comparisons of the VW incentives to the proposed industry bailout are an “extreme example of comparing apples to oranges.”
“What we are providing is a relatively small amount of incentives compared to the billions requested by the whole industry,” he said. “When Volkswagen first came up, we were at the Detroit auto show looking for any automaker that was shopping for a site, and we would have made similar offers to any company.”
VW spokeswoman Jill Bratina said the company is supportive of a bailout, and she added that the state support it is receiving will help the economy as a whole.
“The state’s co-investment with us ensures the success of (our) efforts, which will ultimately translate into more than 11,500 jobs in the area, $12 billion in new economic activity for the state and more than $1 billion in new tax revenues over the life of the project,” she said.
WHITE HOUSE PLAN
White House press secretary Dana Perino said the administration is willing to consider all options, including use of the Wall Street rescue funds, to prevent the automakers from going under.
“A precipitous collapse of this industry would have a severe impact on our economy, and it would be irresponsible to further weaken and destabilize our economy at this time,” she said.
Sen. Corker said he hopes that if Treasury Secretary Hank Paulson taps into the $700 billion for an auto bailout, the loan would come with the same covenants he developed in his alternative proposal.
In addition to the union wage concessions, Sen. Corker’s three-point plan called for the Big Three to get their bondholders to agree to swap the debt for equity and change payments to a retiree health-care trust so half the payments would be in stocks.
Sen. Corker said those covenants are the only way to force the Big Three to restructure to remain competitive.
“Is it a better deal for the UAW if these companies limp forward, continue to close plants, lay people off (and) lose market share?” Sen. Corker asked.
Sen. Lamar Alexander, R-Tenn., missed the Thursday vote after having back surgery in Tennessee but would have voted against the House bailout bill, spokesman Lee Pitts said.
“Government involvement may have some role in the solution here, but putting a government that can’t run itself very well in charge of running big car companies makes no sense,” Sen. Alexander said in a statement.
Sen. Johnny Isakson, R-Ga., voted against the bill, as did Sen. Saxby Chambliss, R-Ga., and said he hopes the Wall Street rescue package is not used to help the automakers.
“This program must remain dedicated to easing the credit markets, which will allow the markets to work and will help consumers regain confidence,” he said.
Staff writers Dave Flessner, Andy Sher and Andy Johns contributed to this story.
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To Senators Corker, Alexander, Isakson, and Chambliss:
The UAW and other major unions did not support your re-election. Matter of fact, they were outright hostile toward you; you owe them nothing.
You made the right decision for all the right reasons. Stick to your guns.
Bob Corker hates Unions.
Bob Corker wants to do to the auto worker as he did to the city workers while he was Mayor of Chattanooga. City employees are still feeling the affect of Bob Corker. Police and firemen are over 50% under paid and I'm sure the rest of the city employees are in the same boat. During this time Bob gave himself several large $6000.00 to $8000.00 per year raises.
If it were up to Bob Corker and people like Corker we would all be making minimun wages. I did not hear a peep from Corker when Citi Bank needed 148 billion dollars the same week as the auto workers were asking for OUR money, 35 billion. Citi Bank was given OUR money for Christmas bonuses to their fat cats, also known as Corkers friends.
Bob Corker hates the working class wage people and thinks we are all pesants who should cater to the rich.
Bob Corker did not say anything to the CEO of the BIG 3 companies when some of them are making over $38,000.00 per HOUR! No, Bob was too worried about the working men and women making a livible wage of $70,000.00 per year.
The average wage for US workers has declined so low that they can not buy a new car and that is part of the reason we are in the situation we are in today. The rich getting richer and the poor and middle class loosing it all.
Well Bob better get ready to work with the Unions, like it or not they will become very strong within the next 4 years. Bob's vote will mean little to nothing in a House and Senate ran buy Democrats. I guess " Little Man Bob" can call his mommy on the phone and complain to her. I think she will be the only one listening.
Without American workers making a livible wage this country will never turn around. Who is going to buy products when people can not live paycheck to paycheck?
Maybe we can clone a bunch of Bob Corkers. They can spend enough money to dig this country out of the hole that the Bush admin. and non-union supporters has put us into.
It's good what he did...however, what's scary is that he did say just 3 or 4 more words and he'd have voted yes! Has everyone forgotten what businesses are created for...its not to give people jobs(?)....
I wonder if Sen. Corker would jump on the bandwagon for a bill that limits the pay for members of the Senate to the legislated pay for Senators? No Senator can make any more than other - they all have to live on the same pay. After all they are taking the taxpayer's money. All income beyond their Senate pay would be taken in taxes regardless of the source.
Did anyone hear him calling for Wall Street workers to be limited in their pay to what people working for the banks in Chattanooga make? Or perhaps the workers at the new Volkswagon plant should be limited to the average hourly wage in Hamilton County - after all they got government money!
I am a Republican (I shamefully admit) and not a big fan of the Unions and definitely not a fan of any of the bailouts. However - if the consensus (right or wrong) is that this is the best way to solve a crisis that has already devastated the economy time has come to agree, do something and move on!
The Majority in the senate wanted to help GM and Chrysler, but thanks to Sen. Corker, now his boss is going to have to do it. All because Corker and his ilk wanted the UAW to take a second cut in pay sometime in 2009. The UAW agreed to take the SECOND pay cut in 2011. Corker wants to sink the auto industry over a difference of 2 years? And people need to stop assuming UAW workers get $76 per hour, that's an outright lie. They start at $14 plus bene's and the average is $56 including bene's. The $76 per hour so often misquoted is when retiree's benefits are factored in to the overall cost, when retirement benefits were already paid by each employee while still working.
Yeah, that $76 an hour figure is pure malarky.
According to other sites, republicans have stayed out of this issue. All of the principals have been debating it with the democrats for days, they've all given up something- bondholders, the UAW, management, the democrats have taken raising CAFE standards off the table- and the republicans nominated Corker to be their point guy on this. They sent him over, he came back, they debated about two hours, and said no. They're just obstructing, because they know if they hold out long enough, they can kill the UAW- and busting unions is worth far more to the conservative movement than Chrysler- or even GM.
If Corker was truly the statesman he'd have us believe, he would lead by example and voluntarily take a pay and vacation reduction. Why should just the average workers be penalized in this economy? Unfortunately, the truth is he is playing games with millions of peoples livelihoods. If union workers supported his party, he'd be bending over backward and would write a check for whatever it took to bail them out. He's the most cynical type of politician - he doesn't care about fellow Americans, only republican supporters! In Georgia, a $90 million I-85 off-ramp was finished yesterday for a new Kia plant - just a small fraction of the fortune being doled out to foreigners! Where's Corker, Chambliss, Isakson outrage on that money!
First of all, neither the Senate nor Wall Street have unions to force up wages and destroy an industry under the threat of a nationwide work stoppage. [As one union boss says, that is comparing apples and oranges.]
If a Senator or a broker stops producing, they find themselves out of a job...be nice if we could tell that to union leadership. If union leadership had its way, every time a high-absentee-rate, lazy "worker" was frowned at by management, every union in the US would be on a picket line.
Unions have NOT become irrelevant; far from it. But the pendulum has swung to the other extreme and they are much too powerful -- they can paralyze the country. Why, some even say they can bankrupt an industry...our auto industry, for instance.
No, unions just need broken up into smaller units -- no larger than statewide, for instance -- with no influence outside their state. No closed shops or "dues" confiscation, either.
The alternative is no union jobs at all...which apparently does not bother union leadership in the least. Evidently they will get paid anyway [from one fund or another].