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TP Lowe

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by TP Lowe » Tue Apr 17, 2007 2:44 pm

Robin Garr wrote:
TP Lowe wrote:Without the union expense issue I suspect it would have just been a slower decline.


Yeah, but isn't this really where the rubber meets the road? What you're saying - and what Walmart and many other corporations say - is that labor is an expense to be trimmed as much as possible in the pursuit of profits. The two-way contract (not union but moral) between management and labor is pretty much out the window without a strong union movement to keep it so.

It could as well be argued that fossilized, stupid management (Northwest Airlines, to pick one sterling example) ought to be allowed to go out of business if they can't operate profitably without screwing their workers, busting their unions and stealing their pensions.


Wow, that's twice today that I think you've read something into my statement that I don't think was really there. All I was doing was wrapping in my earlier statement to draw the conclusion that the American auto industry has been in a decline for many reasons, including what I consider overreaching union contracts. Even without the union contracts they would be in decline for all the reasons others have pointed out earlier by others.

Now, as to cost cutting: the reality is that it is the job of management to consider all inputs into the bottom half of the income statement and try to minimize them to the extent it makes sense. Some companies clearly think personnel costs are sacred, others do not. I suspect you will choose your vendors with your opinion of that in mind - nothing wrong with that, it's part of the American way (as is everything else we've debated today and previously).
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Steve Magruder

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by Steve Magruder » Tue Apr 17, 2007 2:46 pm

Leah s wrote:Steve, you should add Blue Mountain Coffee House to your list of local coffeehouses to patronize. I guess they were included in the "etc." but they are really head and shoulders different from most every other place in town. Not only it is locally owned, the coffee wonderful, but the decor is stunning. I will happily pay $5 for a fabulous coffee drink, but I will not do so while sitting on thriftt store castoff furniture.


Hadn't heard of them. I'll be sure to try them out sometime. Thanks for the lead!
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by Steve Magruder » Tue Apr 17, 2007 2:52 pm

TP Lowe wrote:Now, as to cost cutting: the reality is that it is the job of management to consider all inputs into the bottom half of the income statement and try to minimize them to the extent it makes sense. Some companies clearly think personnel costs are sacred, others do not. I suspect you will choose your vendors with your opinion of that in mind - nothing wrong with that, it's part of the American way (as is everything else we've debated today and previously).


I can't find much to disagree with in your position, so I'll leave it at that.

But I really do think it's funny that Americans are not harsher in their judgments of companies that overly squeeze their people. We really do need a data warehouse of sorts where we can track how companies treat their employees (not to mention their communities and the environment). Something like this could lead to a more socially and economically healthy nation, IMHO. A transparent marketplace would seem to me to be what free market enthusiasts would want.
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Charles W.

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by Charles W. » Tue Apr 17, 2007 2:55 pm

I think some of the problem with the auto industry and airline industry is that management and union leadership is fossilized. When the the Big 3 dominated the auto industry and the flagship airlines dominated the airline industry, both had it good. As management and unions have been challenged, neither wants to give up what they had.

Isn't it something like $2000 more in fixed cost per car for a car made by a Detroit automaker than by a Japanese automaker? That $2000 is due not only to union contracts, of course, but of skyrocketing health care costs, etc. [by the way, the executive compensation at such times is obscene, but that has already been discussed on this board]

I have never purchased a car from an American automaker, but I have sympathy for their situation. There's still a good ways down to go before they have a real shot at health.
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by TP Lowe » Tue Apr 17, 2007 2:56 pm

Steve Magruder wrote: We really do need a data warehouse of sorts where we can track how companies treat their employees (not to mention their communities and the environment).


There are a number of databases like you are talking about that are available for the investment community. But, they are all very expensive and probably are never used in the way you suggest.
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by TP Lowe » Tue Apr 17, 2007 2:59 pm

Charles W. wrote:
Isn't it something like $2000 more in fixed cost per car for a car made by a Detroit automaker than by a Japanese automaker? That $2000 is due not only to union contracts, of course, but of skyrocketing health care costs, etc.


When I made that reference to health care costs earlier this is exactly what I was talking about. A good part of that amount is due to union contracts where the health benefits have been negotiated to the point that they are unsustainable.

By the way, we should all note the exact same thing is happening in Kentucky, where we have a pension and health care system that is $15 billion + under water by over-promising and under-delivering.
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by Steve Magruder » Tue Apr 17, 2007 3:11 pm

TP Lowe wrote:
Steve Magruder wrote: We really do need a data warehouse of sorts where we can track how companies treat their employees (not to mention their communities and the environment).


There are a number of databases like you are talking about that are available for the investment community. But, they are all very expensive and probably are never used in the way you suggest.


I suppose if The People see a real need for this, somebody will open-source it ultimately. A need for a free general reference led to the Wikipedia. So, the development of a data warehouse like this is within the realm of possibility.
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Jeremy Mott

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by Jeremy Mott » Tue Apr 17, 2007 3:31 pm

A good part of that amount is due to union contracts where the health benefits have been negotiated to the point that they are unsustainable.

By the way, we should all note the exact same thing is happening in Kentucky, where we have a pension and health care system that is $15 billion + under water by over-promising and under-delivering.


Could not some of, er...a great deal of the blame be placed at the feet of the heathcare industry? Not touching the union issue with a ten-foot pole but, somewhat in their defense, they are trying to secure health benefits for their members. Seems like healthcare waste, fraud, inefficiencies, etc. deserve some of, er...a great deal of the blame for the (outrageous) $2000 greater fixed cost per auto.
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by TP Lowe » Tue Apr 17, 2007 3:40 pm

Jeremy Mott wrote:
A good part of that amount is due to union contracts where the health benefits have been negotiated to the point that they are unsustainable.

By the way, we should all note the exact same thing is happening in Kentucky, where we have a pension and health care system that is $15 billion + under water by over-promising and under-delivering.


Could not some of, er...a great deal of the blame be placed at the feet of the heathcare industry? Not touching the union issue with a ten-foot pole but, somewhat in their defense, they are trying to secure health benefits for their members. Seems like healthcare waste, fraud, inefficiencies, etc. deserve some of, er...a great deal of the blame for the (outrageous) $2000 greater fixed cost per auto.


Well, sure. If health care costs had remained static (or increased at a lesser rate) the contracts would not have become unsustainable. Just like Kentucky's retirement system, companies promise what they think they can deliver at the time of the promise. With the auto companies, negative factors come at them from both sides - declining demand and increasing costs.
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by MikeG » Tue Apr 17, 2007 3:40 pm

Yes unions have gotten bloated and out of control but that's because no one kicks them and reorganizes when they get out of hand like that. Unions are like insurance you pay for them to take care of you when things get crazy. If your insurance company starts screwing you you get a new one, if you just keep them you keep getting screwed.

I miss working with a union backing me in case my employer starts getting crazy.
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by Suzi Bernert » Tue Apr 17, 2007 4:25 pm

Have been both union and non-union throught the years. I have mixed feelings about the current state of unions, especially the ones who represent government workers. That being said, we need to look at the history of the union movement and what conditions were "back in the day". How many of you get a nice 40 hour work week? Thank the union movement. How many of you have health insurance partially funded by your employer? Thank the union movement. How many of your jobs have mandated safety standards? Thank the union movement.

The conditions and benefits that Americans take for granted were in large part due to the union movement. Left to their own devices, many employers would not be "nice guys" who care if you worked from dawn to dusk without breaks or safety. The union movement was part of the changes to the modern work place. The unions have not and are not perfect by any means, but many of the benefits we enjoy today were in part because of unions.

Lesson over!! BTW ole Henry Ford was not know for his responsiveness to the public comsumption - you could get Model Ts in any color as long as it was black!!
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christopher stockton

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Jackson's Organic Coffee

by christopher stockton » Tue Apr 17, 2007 5:24 pm

Thanks guy's it is Jackson's Organic Coffee and Heather I appreciate you popping in darling.
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by Heather L » Tue Apr 17, 2007 5:38 pm

Of course! And if I still have $2 in my wallet in the morning, I will probably be back again! :D

I want to meet Jackson soon though!
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by Jon K » Tue Apr 17, 2007 6:50 pm

Christopher: Please forgive me for my error. Pictures from Brasil to follow!
Your obedient servant etc.
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by christopher stockton » Wed Apr 18, 2007 6:13 am

I'll allways spot ya Heather.... Jon I Look forward to the pics mate ;)

Thanks again
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