marswind

Should We Really Bail Out the Big Three Automakers with $73.20 Per Hour Labor?

Let's face it. We tax labor in this country through income taxes. Labor costs are high because fully a third or more of those costs are taxes the worker never sees. Since UAW workers presumably make more, they also pay more at a higher rate as our income tax system is progressive.
It also should be noted that with the most recent contract, starting wages were lowered to below fifteen dollars an hour. This is a huge retrenchment by the union. They are not unaware of economics. Also, the union is going to assume management of retiree health care at less cost which in turn will result in less benefit.
I have actually attended a class taught by Professor Perry and I have great respect for him. He is what I would call a purist and maybe not given to all the subtleties of the automobile market.
I would ask him how many factories is GM allowed to operate in Japan?
Since Toyota (GM's primary competitor) sells approx. 2 million vehicles in Japan without U.S. competition, how does this impact an American company's ability to compete?
Is it not true that certain foreign automobile companies are taxed by a VAT in their home country and these taxes are rebated at export?
Is it not true that some industries are taxed more than others and American Auto manufacturers are more highly taxed than others?
Is it not true that American manufacturers are highly capital intensive and wages are high primarily due to that high productivity? And isn't it true that if wages had matched those gains in productivity they would be even higher?
Is it not true that due to the much higher skill set required with modern manufacturing equipment that a much larger proportion of the work force is skilled, and because of this, the average worker makes more money?
Is it not true that Toyota primarily assembles automobiles in the U.S. and the assembly process requires a lower skill set than actually producing components? (And yet, Toyota's actual hourly wage is higher in any given position). Assembly is just one small portion of producing a car.
GM is (somewhat morally) on the hook for 400,000 retiree's and their dependents. Those costs will ultimately be borne by the government anyway. How much of Professor Perry's wage and benefits are borne by the taxpayer? At least one seventh of Professor Perry's students are or were GM employee's! I know what those tuition costs were (believe me). Talk about lack of competition!!! Why don't we teach class from a TV screen and the internet and let Professor Perry earn a living doing that?
Are his classes really worth that much?? ( Can we say "barriers to entry??"). College went up how much in the past ten years? How does that compare to the relative price of a car? Good question?