Ron Gettelfinger Takes On America

Ron Gettelfinger lives in a very interesting little world. Even within the bubble of automotive Detroit, where grappling with economic reality is not the order of any day, the United Auto Workers president is outside what passes for the mainstream.

In this respect, he is different from predecessors such as Owen Bieber, Douglas Fraser and Walter Reuther only by matters of degree. They, like he, regarded automakers as unlimited vaults of cash controlled by evil, greedy fat cats who could be dealt with only through threats, intimidation, guilt-mongering, public propaganda and more threats – all for the righteous purpose of transferring fat-cat wealth into the hands of the sainted, blue-collar workers who pay compulsory dues to the aforementioned gentlemen.

This has been the view of the American labor movement for generations. Its perpetuation depends on the rock-solid conviction that labor costs cannot possibly rise so high as to imperil a company – and in any event, it would be wrong to blame the sainted workers if they did.

What separates Mr. Gettelfinger from his predecessors is two things: 1) The folly of his belief in this notion is far more obvious than theirs, given the desperate state of the automakers who have allowed him to help put them on the brink of bankruptcy; and 2) Mr. Gettelfinger, unless someone reins him in, is in a position to completely destroy a state and potentially cripple the other 49.

And thanks to a horrific missed opportunity on the part of George W. Bush, the only person who can rein in Gettelfinger now is Barack Obama.

President Bush, given the opportunity to impose pretty much any conditions he wanted on General Motors and Chrysler in exchange for a lifeline from the Troubled Asset Relief Program, punted. The requirements for “viability” are so vague that they can be redefined to suit almost any progress or lack thereof the automakers make by the March 31, 2009 deadline.

The “targets” in the deal are the right ones – especially the one that requires GM and Chrysler to get their labor costs in line with the foreign transplants by the end of 2009. Supposedly, if the automakers fail to demonstrate their newfound viability by March 31, according to these requirements and targets, the government can demand the loans be paid back immediately, and the companies forced into Chapter 11.

But aside from the fact that the companies will certainly not have the money to repay in March, the weasel words in the not-so-fine-print essentially mean they have complete liberty to fall short of the targets, provided the Obama Administration accepts whatever excuse they offer.

Can you envision any circumstance in which Obama calls in the loans and forces GM and Chrysler into Chapter 11? Neither can I, but maybe the president-elect relishes the opportunity to demonstrate his seriousness and win respect from some of us who never anticipated giving it. If so, there’s no mystery from whence the challenge will come.

Less than six hours after Bush announced he was committing the TARP money to bail out the automakers, Gettelfinger had already declared he would fight to have “unfair conditions” removed. In other words, just as he has said all along, the UAW has made enough concessions and will be making no more.

It must be in a union president’s job description to understand absolutely nothing about how a business operates. Mr. Gettelfinger is well qualified. Not only does he not understand that costs have consequences, he also appears to believe that a business in desperate need of financing to stay alive can play hardball with the lender of last resort.

If Gettelfinger and the UAW successfully resist further concessions, and Obama nonetheless approves the pathetically inadequate restructuring plan that would have to result, he will lock in the suicidal economic model that will then finish off Michigan as a viable state. Worse still, he will ensure that $17.4 billion that could have produced many millions of entrepreneurial jobs as venture capital, was flushed down the toilet – surely to be followed by more.

Ron Gettelfinger is a clueless, obstinate man who cares nothing about economic rationality or about the consequences of his actions. He cares only about resisting “givebacks” and bludgeoning management – because that is his job and that is his universe. If he gets away with it this time, he will take a bad idea and ensure that it becomes catastrophic.

And only Barack Obama can stop him. Joe Biden warned us that Obama would see a challenge early on from a nefarious troublemaker somewhere in the world. We had no idea it would come from Detroit. Ron Gettelfinger threatens America, and now we’ll see if Obama really has that spine of steel Biden told us about.

Count me skeptical, but willing to be convinced. Show us something, Mr. President-elect. The thugs come from the damndest places.