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Where is the bail out money
going?
It's sad to say that "we the people" who actually used to be "we
the colonist" a couple of centuries ago, who fought and won the
right to print our own money, surrendered that right back in 1913.
You can thank Woodrow Wilson for that one. His campaign was
financed by PACs funded by the same people that own the
Federal Reserve Bank today. Imagine that!
My parents were still under the impression that the Federal
Reserve Bank, whom they referred to as the Fed, was the
government. When I told them that the Federal Reserve Bank
was as "federal" as Federal Express, a strange look came over
their septuagenarian faces. My father asked:
"You mean to tell me that they are not the government?"
going?
It's sad to say that "we the people" who actually used to be "we
the colonist" a couple of centuries ago, who fought and won the
right to print our own money, surrendered that right back in 1913.
You can thank Woodrow Wilson for that one. His campaign was
financed by PACs funded by the same people that own the
Federal Reserve Bank today. Imagine that!
My parents were still under the impression that the Federal
Reserve Bank, whom they referred to as the Fed, was the
government. When I told them that the Federal Reserve Bank
was as "federal" as Federal Express, a strange look came over
their septuagenarian faces. My father asked:
"You mean to tell me that they are not the government?"
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ABC's Overpaid Autoworkers
12/5/08
In an attempt to explain the plight of the Big Three U.S. automobile manufacturers, ABC's World
News used a wildly misleading statistic regarding autoworkers' pay. On the December 3 edition of
the ABC newscast, reporter Chris Bury took aim at the supposed inflexibility of the United Auto
Workers: "But the union did not offer to give back the big stuff, pay and benefits that remain a
fundamental problem. Ford, Chrysler and GM pay union workers more than $73 an hour in wages
and benefits. Japanese plants here shell out just over $44. For GM, that translates into $1,500 more
per car more than Toyota has to pay."
This factoid, which is a favorite of the industry--and, increasingly, of the media as well (see Media
Matters, 11/22/08 )--has been exposed as misleading for some time. In the New Republic
(11/21/08), Jonathan Cohn called it "wildly misleading," and cited an analyst for the Center for
Automotive Research who determined that "average wages for workers at Chrysler, Ford and
General Motors were just $28 per hour as of 2007." The much higher figure, according to Cohn,
results from a mathematical sleight of hand--taking "the cost of all employer-provided
benefits--namely, health insurance and pensions--and then dividing by the number of workers." In
other words, costs related to retired workers, who well outnumber current employees, are used to
create an inflated figure that is misleadingly labeled as current labor costs.
Writing in Portfolio (11/18/08), Felix Salmon called it a "ridiculous number," adding: "Now that GM's
healthcare obligations are being moved to a UAW-run trust, even that fictitious number is going to
fall sharply. But anybody who uses it as a rhetorical device suggesting that U.S. car companies are
run inefficiently is being disingenuous." The United Auto Workers also has a page on their website
debunking the industry figures (http://www.uaw.org/barg/07fact/fact02.php).
And as the Wall Street Journal reported (11/20/08), "During the past three years, the union agreed to
eliminate tens of thousands of production jobs, reduce healthcare coverage for union retirees and
slash wages for new hires--moves that essentially level the playing field between the Big Three
auto makers and their foreign-owned rivals." The paper went on to explain that these concessions
are significant: "Analysts believe the changes will bring the average cost of union labor to less than
$50 an hour by 2010 or 2011, in line with Toyota Motor Corp.'s labor costs. The Harbour Report, a
closely watched scorecard of auto-plant productivity, earlier this year found that in 2007 the average
per-vehicle labor costs for the Big Three in 2007 was no more than $260 above Toyota's"--far from
the $1,500 premium ABC claimed GM pays.
ABC did include a quote from UAW president Ron Gettelfinger, saying that he "bristled at blaming
auto workers"--but ABC's newscast was as much behind the finger-pointing as the industry is. As
economist Dean Baker noted (Beat the Press, 11/18/08), this misinformation has serious
consequences: "It certainly can affect public support for a bailout if they are led to believe that
autoworkers are paid much more than is actually the case." ABC should correct the record.
ACTION: Tell ABC that it should correct its December 3 report that inaccurately characterized
autoworker salaries.
CONTACT: ABC World News Phone:212-456-4040
12/5/08
In an attempt to explain the plight of the Big Three U.S. automobile manufacturers, ABC's World
News used a wildly misleading statistic regarding autoworkers' pay. On the December 3 edition of
the ABC newscast, reporter Chris Bury took aim at the supposed inflexibility of the United Auto
Workers: "But the union did not offer to give back the big stuff, pay and benefits that remain a
fundamental problem. Ford, Chrysler and GM pay union workers more than $73 an hour in wages
and benefits. Japanese plants here shell out just over $44. For GM, that translates into $1,500 more
per car more than Toyota has to pay."
This factoid, which is a favorite of the industry--and, increasingly, of the media as well (see Media
Matters, 11/22/08 )--has been exposed as misleading for some time. In the New Republic
(11/21/08), Jonathan Cohn called it "wildly misleading," and cited an analyst for the Center for
Automotive Research who determined that "average wages for workers at Chrysler, Ford and
General Motors were just $28 per hour as of 2007." The much higher figure, according to Cohn,
results from a mathematical sleight of hand--taking "the cost of all employer-provided
benefits--namely, health insurance and pensions--and then dividing by the number of workers." In
other words, costs related to retired workers, who well outnumber current employees, are used to
create an inflated figure that is misleadingly labeled as current labor costs.
Writing in Portfolio (11/18/08), Felix Salmon called it a "ridiculous number," adding: "Now that GM's
healthcare obligations are being moved to a UAW-run trust, even that fictitious number is going to
fall sharply. But anybody who uses it as a rhetorical device suggesting that U.S. car companies are
run inefficiently is being disingenuous." The United Auto Workers also has a page on their website
debunking the industry figures (http://www.uaw.org/barg/07fact/fact02.php).
And as the Wall Street Journal reported (11/20/08), "During the past three years, the union agreed to
eliminate tens of thousands of production jobs, reduce healthcare coverage for union retirees and
slash wages for new hires--moves that essentially level the playing field between the Big Three
auto makers and their foreign-owned rivals." The paper went on to explain that these concessions
are significant: "Analysts believe the changes will bring the average cost of union labor to less than
$50 an hour by 2010 or 2011, in line with Toyota Motor Corp.'s labor costs. The Harbour Report, a
closely watched scorecard of auto-plant productivity, earlier this year found that in 2007 the average
per-vehicle labor costs for the Big Three in 2007 was no more than $260 above Toyota's"--far from
the $1,500 premium ABC claimed GM pays.
ABC did include a quote from UAW president Ron Gettelfinger, saying that he "bristled at blaming
auto workers"--but ABC's newscast was as much behind the finger-pointing as the industry is. As
economist Dean Baker noted (Beat the Press, 11/18/08), this misinformation has serious
consequences: "It certainly can affect public support for a bailout if they are led to believe that
autoworkers are paid much more than is actually the case." ABC should correct the record.
ACTION: Tell ABC that it should correct its December 3 report that inaccurately characterized
autoworker salaries.
CONTACT: ABC World News Phone:212-456-4040
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