Contracts Can’t Be Broken—Unless They Involve Union Workers

[Earth Bound Misfit]

Contracts can’t be broken. We learned that lesson well over the past few days when AIG honchos swore that despite being bailed out by $173 billion in taxpayer funds, they couldn’t break the sacrosanct contractual bond that guaranteed billions in bonuses to the same top executives who brought the insurance giant to its knees.

But we also were taught another lesson in these months of financial chaos: Contacts can’t be changed—unless they involve unionized autoworkers.

Tim Rutten at the Los Angeles Times really hits the mark today when he writes

What we’re essentially being asked to believe is that employment contracts involving hardworking men and women on Detroit’s assembly lines are somehow less legally binding—less “sacred” in the current rhetorical argot—than those protecting a bunch of cowboy securities traders living in Connecticut...

For years, the smart guys on Wall Street have convinced a growing number of Americans that organized labor is an impediment to economic progress, an unacceptable “cost” in a globalized system of production, a quaint social fossil from the era of mills and smokestacks. If there’s a lesson to be gleaned from the current crisis, however, it’s that when the chips are down, organized labor is a far more responsible social actor than the snatch-and-run characters who fancy themselves financiers.

snip

So, to make sure I have this right, we can give $185 billion to AIG and we have to uphold their employment contracts with 80 people, but we can’t give 1/5th that amount to General Motors unless they abrogate their employment contracts with 100,000 workers.

http://blog.aflcio.org/2009/03/18/contracts-cant-be-brokenunless-they-involve-union-workers/

snip

All of the power is concentrated in the hands of the very few at the very top and the gap between CEOs’ and workers’ pay continues to grow. That is why we need to pass the Employee Free Choice Act.

Passing the Employee Free Choice Act will allow workers to have a voice at work, lift their standard of living and build stronger communities as well as stronger families.

A Gallup poll released in recent days found 53 percent of the U.S. public supports the Employee Free Choice Act, which was reintroduced in the U.S. Congress last week. Why? Because we need a stronger middle class. One with contracts that are sacrosanct.

[stillcool]

1. Contracts are re-negotiated..

this contract was not between the owner and the employer, this contract was between the government and the employer. Everyone who signed the Bail-out bill needs to pony up and pay the bonuses.

[LakeSamish706]

2. Well, after watching the total content of the hearings with CEO Liddy....

I seriously am not against the bonus's like I was before I watched them. One million is allot of money to pay out to 73 - 80 people, but it might well have cost AIG (US tax payers) much more to start from scratch if these employees had packed up and walked without shutting down their books. JMHO...

[Duke Newcombe]

3. Those 80 people are not the only capable people on Wall Street...

...let alone planet Earth. They should be thankful they're not in the unemployment line, or in prison.

The reasoning of "they're the only ones who can help us" is like saying the arsonist that torched your house is the only one qualified to put out the fire.

Bomb Squads around the country defuse bombs everyday, all without the bombmaker's help, thank you very much.

[LakeSamish706]

5. Yep, your right, but what would the start up costs be to get these new people...

up to speed? I am not advocating that we should pay these bonus's, but I am saying that we should at least have a serious talk with CEO Liddy and find out what he thinks about things. As I said in some previous posts, I don't know what to think of CEO Liddy, but I am willing to give him the benefit of the doubt.

[Duke Newcombe]

6. The man strikes me as a spineless...

situationally tone-deaf tool. He could think of NO other ways of retaining these people, like re-negotiating these retention bonuses, spreading out, or delaying payment? My dang TEN YEAR OLD daughter thought of that one!!!

[LakeSamish706]

7. Ummmm He is being paid $1.00 per year... And so far (from what I recall) from...

the hearing they have reduced the debt by approx. 70 - 80 billion dollars... What does he owe you or me, the American citizen? As I have stated in other posts, he was asked (by the previous Administration to assume the duties of CEO) and I don't know the man or if he is good or bad, but so far I trust what I heard. He seemed to be genuinely concerned for the safety of his employee's as far as the pitch fork toting folks go.... So, hey I just don't know.

[Jim Sagle]

4. Ben Bernanke, is that you?

[LakeSamish706]

8. Yeah, it is ok... n/t