Oh Yes They Did
Posted December 2nd, 2008 at 10.57am in Enterprise and Free Markets.
Big labor apologist EJ Dionne Jr. asserts in the Washington Post today:
The failure of the Big Three is regularly attributed to the high wages and benefits earned by members of the United Auto Workers union, and it’s true that the Detroit-based auto companies operate under heavy “legacy costs” for retirees’ pensions and health coverage negotiated during the industry’s fat times.
But the blame-the-workers-first cant ignores the fact that if the Big Three had designed better cars, they would not have lost as much market share to Toyota, Nissan and other competitors. The unions did not prevent management from producing a better product — and I say that as someone who has enjoyed driving Saturns for the past 15 years.
Oh but the union most certainly did restrict the type of cars the Big Three were able to produce. Megan McArdle explains:
Management has made a lot of mistakes. But making big cars wasn’t one of them. That’s because they couldn’t profitably make small cars in the United States. And the reason they couldn’t is that their labor costs were too high. All in, Detroit was paying about $30 more an hour than other companies to make cars. At that kind of differential, you have to concentrate on large cars with big profit margins, not economy cars where consumers fight to save $15 on the headlight bezels.

December 2, 2008 Mark,Houston writes:
Ya’know , there has been alot of talk about blaming the U.A.W and other unions for the problems with the auto industry . The real story is that I know of no AMERICAN who would turn down more money in the job their doing . The upper mgmnt. at the U.A.W.has indeed made some mistakes but do not blame the workers . remember ENRON wasn’t a union company and niether is AIG but they seem to have no problems with the govt. bailing them out( AIG that is.).we need to stop putting the blame on union workers and start putting it where it belongs .