The American Spectator

Yes, the UAW is a cancer eating away GM and the other of the Big Three auto companies.

GM management should have confronted the union thugs a long time ago. I say thugs because that’s what the union is. Face it, UAW members have relatively low education and their skill levels are low. The fact is that they could be replaced rather simply if a free market was in play. But it isn’t. In the past, what kept the Big Three from moving aggressively to protect themselves from being eaten away by the UAW is that the union basically had a license allowing for criminality and violence. This was the legacy of the long reign of Democratic Party dominance in Washington starting in 1933 until the mid '90s.

p>This latest labor contract will do little to help GM. Its high cost structure is still there, and more tellingly, the union has not been broken as it has to be if the patient to survive. If GM was serious about a turn around, it would declare bankruptcy and abnegate the union contracts and start fresh. Anything else is wishful thinking. br> — Peter Skurkiss br> Stow, Ohio /p>

Actually, there is a fourth option, albeit also known as the “nuclear option.” The beauty is in its simplicity and elegance.

Tomorrow, the three horsemen — GM, Ford, and Chrysler — shall shutter all component and final assembly plants and relocate those labor-intensive operations to India and China forthwith: facilities and workers are standing by. The simplicity is akin to ripping a band-aid off an already-mestastized abrasion. The elegance is two-fold: first, killing the union albatross hanging around the companies’ collective necks; and second, becoming competitive in a global market by leveraging the low-cost, moderate-skilled labor currently in supply.

The concept at issue is called “comparative advantage.” There is no longer a comparative advantage in keeping low to no-value cost centers in the U.S. if those same cost centers can be undercut by overseas competitors.

This now frees the automakers to fully concentrate on the only value-creation process available to them (based on their industry) in the United States — R&D. Since the mid-'90s, the U.S. has transformed, at warp speed, from a post-industrial economy, to a knowledge-based economy. Those who have transformed successfully are now reaping the rewards. Those who did not (automakers, computer manufacturers, and in the past, buggy whip manufacturers) established a history of multiple-quarters in the red.

Divest high-expense operations in the States; re-establish those operations in low-cost countries; throw the unions a big wet kiss; and give Congress a big “Thank You” on behalf of those who want to establish the card vote.

p>Waiting the “next 5-10 years” is a sure-fire losing strategy. br> — Owen H. Carneal, Jr.