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User Forum Topic
Submitted by flu-redux on July 18, 2013 - 6:54pm

Submitted by spdrun on July 18, 2013 - 7:39pm.

Anyone remember: "Ford to City: DROP DEAD?"

Submitted by SD Realtor on July 18, 2013 - 7:46pm.

Taking odds on federal taxpayer money bailing out pensions.

Submitted by paramount on July 18, 2013 - 9:36pm.

Another victim of public sector unions.

Public Sector Unions are a Terminal Cancer.

Submitted by The-Shoveler on July 18, 2013 - 9:58pm.

SD Realtor wrote:
Taking odds on federal taxpayer money bailing out pensions.

No fair, I already made that prediction several months ago But I was talking about the city of L.A.

But Man I just killed a big rattle snake outside my back door so there (I know but I had to tell someone)

And yes I did it with a shovel.

Submitted by mike92104 on July 18, 2013 - 10:07pm.

It's ashamed you killed it. I use the shovel scoop them into a large trashcan and relocate them later.

Submitted by CA renter on July 18, 2013 - 10:21pm.

paramount wrote:
Another victim of public sector unions.

Public Sector Unions are a Terminal Cancer.

That has got to be one of the most ignorant statements you could possibly make. Detroit's problems are tied to the demise of the manufacturing sector (largely because of **mismanagement,** not unions), white flight, and the resulting demographic/population changes.

Some history:

http://www.reuters.com/article/2013/07/1...

http://www.npr.org/2012/09/11/160768981/...

http://www.changinggears.info/2011/03/23...

Submitted by paramount on July 18, 2013 - 10:42pm.

Detroit Gave Unions Keys To The City, And Now Nothing Is Left

http://www.forbes.com/sites/kylesmith/20...

We keep hearing that the car industry in Detroit is “on the rebound” or that “Detroit is back.” In fact, the city itself is on its back, and it’s bounding toward bankruptcy or a state takeover. How did one of America’s most storied cities land in this predicament? While the city population has shrunk (from a peak population of 1.8 million in 1950 to 714,000 in the last census), it has hardly reduced the government that serves it. All you really need to know about Detroit, which is facing a $327 million budget gap, is that last year it was discovered to still be paying for a “horseshoer” (or farrier) on the Detroit Water & Sewer Department (DWSD) payroll. This individual costs some $56,000 in pay and benefits, despite the city not having any horses to shoe in his department.

Union bosses insisted the DWSD (average compensation: $86,000) needs more, not fewer, such unionized employees, a view associated with a broad spectrum of thinkers from Jimmy Hoffa to the Keynesians running the United States. The DWSD has more than twice as many employees per gallon of water pumped as that other paragon of Midwestern governance, Chicago. An independent report said four out of five employees in the bloated department were redundant and discovered a thicket of union regulations driving up costs. Plumbers complained that, due to union work rules, they had to wait to fix pipes until duly authorized “operators” came along first to shut them off.

The Detroit Federation of Teachers, which enjoys rich pay packages (corrected for purchasing power, Michigan teachers are the best paid in the nation, reported the Mackinac Center for Policy Policy), would do the UAW proud. Its employees pay only ten percent of the cost of their insurance premiums. While they take extravagant numbers of sick days or personal days — 8 per teacher — they also cash in on “unused sick days” to the tune of $14.5 million a year. What other industries are so surprised when you aren’t sick that they pay you a bonus? Then again, we’re talking about a group that paid people to quit — $4.1. million in “termination bonuses” were handed out to teachers’ union members in 2010-2011. And last December the city inexplicably sent out archaic “longevity bonuses” ranging from $150 to $750 depending on years of service for non-union municipal employees, even though the benefit was removed for unionized employees in 2009.

The Detroit Service Employees’ International Union did even better, soaking individuals for its own purposes. It arranged to corral thousands of people receiving Medicaid payments to care for sick friends or relatives into its union, for the purpose of charging these people dues, which it siphons directly from the Medicaid checks. So far SEIU has raked in $34 million this way.

From 2008 to 2011, health insurance costs for Detroit employees and retirees have jumped 62% to $186 million a year, the Detroit Free Press reported. Pension contributions in that period jumped 140 percent, from $50 million to $120 million.

To fight for their lavish compensation, unions have proven prepared to fight back with any weapon at hand. Appointing emergency financial managers is “just like being in the slave days,” complained Iris Salters, the president of the Michigan Education Association.

What Detroit did/does is give unions the keys to the treasury until nothing is left. That day has come.

What can save Detroit?

Nothing.

Submitted by njtosd on July 18, 2013 - 11:22pm.

I grew up outside of Detroit. I rarely hear anyone mention the long term effects of the riots in the late 60s (other than the ensuing white flight). In 1990, there were still burned out buildings left over from the riots. And Mayor Coleman Young promoted the idea of continually increasing taxes on downtown businesses - who eventually found it more convenient and safer to move what was left of their businesses to the suburbs.its a sad day - but the blame should be placed on governmental short sightedness before even bothering to look at the big three or the unions.

Submitted by FlyerInHi on July 18, 2013 - 11:41pm.

SD Realtor wrote:
Taking odds on federal taxpayer money bailing out pensions.

I doubt it. I think the Feds will let the chips fall where they may in this case. The pension benefits guarantee corporation will deal with it. The bailout will occur if the PBGC ever needs a bailout. Edit: actually I don't know if they guarantee municipal pensions. The state of Michigan could step in and do something.

Too much of a hot potato here... Black political corruption, mismanagement, etc...

Submitted by SD Squatter on July 19, 2013 - 10:40am.

We voted for you, now bail us out!

http://www.youtube.com/watch?v=zI8HRGWKCRc

Submitted by FlyerInHi on July 19, 2013 - 11:40am.

We will see.

But I think that if there had been a Washington bailout it would have happened before bankruptcy filing.

It is said that decentralized government is so that each locality or state can be a laboratory for solutions. A large city filing for bankruptcy is a good thing. It's better than cutting services while paying debts and further hollowing out the tax base. The thousands who will take a haircut in this process is preferable to continual decline and eventual shutting of the doors.

Detroit is a special case. It needs to scale from a city of 2 million people to 700,000.

I have a friend who lives in Livonia, mi, outside Detroit. I have no interest to ever visit. Although I keep on wondering if investing in real estate in Detroit and being an absentee owner can be profitable. Maybe I can afford a commercial building and be on the ground floor of an economic revival; or I can lose my ass and get killed by a gangster too.

Submitted by spdrun on July 19, 2013 - 11:45am.

Why not visit? Travel never hurts, and not all of Michigan is anything like DeeeeTROIT proper.

Submitted by moneymaker on July 19, 2013 - 12:52pm.

What big city will be next? I think Detroit is a microcosm of the country as a whole. Their white flight is like large companies going abroad (those that are big enough to afford to, that is). Their budget problems are like the national debt, just going up up up. They are going to have to pay more for the money they borrow after this is over, just like the value of the dollar will decrease due to inflation when the country finally succumbs. In my opinion there is no stopping it now, it's just a matter of when and how. I mean the fact that their population went down means nothing, with less population service costs go down. Now if you look at average incomes that would probably be more informative, although if they are at the expense of the budget(unions) then may also be meaningless. US personal and household incomes have gone down in the last 10 years, not a good sign!

Submitted by FlyerInHi on July 19, 2013 - 12:49pm.

I hear that Ann Arbor is nice.

Maybe visit and look at real estate. I love real estate.. Something to do with the tangible nature of it. My dream is to own an urban style building with stores below and apartments above. Don't know if that'll ever happen.

I know a dude who's 95 and still manages his real estate. He sends out manual invoices every month. Very cool. I love the old fashioned hands on approach.

Submitted by paramount on July 19, 2013 - 1:06pm.

FlyerInHi wrote:

I know a dude who's 95 and still manages his real estate. He sends out manual invoices every month. Very cool. I love the old fashioned hands on approach.

Sounds like a PIA more than anything else...

Submitted by DriveByLurker on July 20, 2013 - 7:48am.

Detroit Bankruptcy Might Transform City Into Some Kind Of Hellish, Depopulated Wasteland

WASHINGTON—Following Thursday’s announcement that the city had declared bankruptcy, reports are confirming that Detroit may suddenly descend into a horrifying, depopulated hellscape, one with numerous dilapidated buildings, rampant urban decay, a failing education system, near-constant drug-related homicides, and a downtown area that looks virtually abandoned. “I fear that, very soon, we may be looking at a city that is completely and utterly unrecognizable from its booming heyday of the 1950s,” said the report’s lead author, Professor Robert Fuchs, noting that Detroit may see its population plunge to half its size amidst a mass exodus of desperate and unemployed residents. “Its citizens might as well enjoy the city while they can, because soon enough they’re going to be living in an uninhabitable wasteland where the police take nearly an hour to get to the scene of a crime, the poverty rate is three times that of the national average, and vacant warehouses look like they’ve been attacked by mortar shells.” Fuchs added that even Detroit’s once dominant auto industry could very well be transformed into a depressing, broken-down husk of its former self.

Credit to The Onion -
http://www.theonion.com/articles/report-...

Submitted by spdrun on July 20, 2013 - 8:20am.

My dream is to own an urban style building with stores below and apartments above.

Come to the East Coast.

Those are a dime-a-dozen in the nearby (and not so nearby) suburbs of NYC. Generally not distressed sales either, just someone who fully depreciated or is getting older and wants to sell off. They go for anywhere from 7 to 10% cap in decent areas from what I've seen.

Submitted by CardiffBaseball on July 20, 2013 - 2:11pm.

FlyerInHi wrote:
I hear that Ann Arbor is nice.

Ann Arbor is a whore.

Go Bucks

Submitted by ctr70 on July 20, 2013 - 9:22pm.

I'm not sure what unions played directly in the city of Detroit's BK. But unions (and the inflexibility they caused) were a BIG part of reducing the U.S. auto industries ability to compete with Japan. If the auto industry in Michigan were run like Silicon Valley with NO unions, things may have turned out very different. Silicon Valley has NO unions and this is a big reason why the U.S. is still #1 in much of high tech and still makes some of the best high tech products and software. The U.S. certainly does not make the best cars and has not for 25-30 years.

Submitted by njtosd on July 20, 2013 - 9:55pm.

CardiffBaseball wrote:
FlyerInHi wrote:
I hear that Ann Arbor is nice.

Ann Arbor is a whore.

Go Bucks

Go Blue.

And I think you mean Buckeyes . . . .

Submitted by mike92104 on July 20, 2013 - 10:01pm.

I somewhat agree. I do see unions as an important part in improving worker safety and standards of living. However, they have to keep demands reasonable. If labor costs are through the roof, and the company can't make a profit and folds, the union loses as well.

I was a member of the International Alliance of Theatrical Stagehand Employees. Since they're an international union, there are a lot of differences between the local chapters. The local I joined was #153 in El Paso, TX. We maintained goof relationships with all of our clients, and were quite often complimented in how well and how quickly we did our jobs (quick is important when you show is loading out at 1am and has to be in Phoenix by 8). As such, we never had an issue with getting work and getting new clients.

When I moved to San Diego, I contacted the local here and decided they were nothing but a gang of thugs. No promoter would use them if they could avoid it, and non union arena's such as Cox, Coors, Viejas, etc got contracts for many, many more shows than the Sports Arena (It doesn't help that the Sports Arena is a dump). The difference was amazing, and I chose to leave the union.

My point is that there has to be a balance. Companies will always try to pay the lowest wage possible, and I think it's great that employees have the option to organize and bargain collectively, but when they run the company into bankruptcy, it's their own damn fault.

My problem with public employee unions is that the "company" will never fold. Labor costs simply continue to soar sucking up more and more tax money from the public until they scream. At that point they're all labeled as "greedy republicans" that don't want to pay their "fair share".

Submitted by FlyerInHi on July 21, 2013 - 11:16am.

The governor of Michigan has it right.

It's about accountability to the citizens of Detroit who are not getting the services they deserve.

Sorry about retirees and bondholders taking a haircut. They are the past, not the future.

Submitted by SK in CV on July 21, 2013 - 1:30pm.

FlyerInHi wrote:
The governor of Michigan has it right.

It's about accountability to the citizens of Detroit who are not getting the services they deserve.

Sorry about retirees and bondholders taking a haircut. They are the past, not the future.

Unless the entire state goes bankrupt, the retirees contracted benefits will be paid. The state is on the hook for them.

Submitted by ctr70 on July 21, 2013 - 2:44pm.

Unions came about originally in the early 20th century to protect workers that were getting abused. The problem is unions went on to become the abusers. Heavily unionized industries have difficulty competing in a global marketplace. They get so bloated and inflexible companies can't be nimble enough to compete.

I had an experience in college working part time in two hotels, one was unionized one was not. The unionized hotel was older and not updated, felt stodgy and stuck in the past, workers didn't hustle, they did the minimum to get by. Poor & lazy workers could not be fired so they remained on the job, damaging the employee culture. It just had a very negative feel about it.

On the other hand, the NON union hotel was an awesome place to work. It was beautiful and newly updated. People had much more positive attitudes and hustled a lot more to create a better guest experience. Workers would go above & beyond what they had to do if asked because it felt like a team environment. Lazy workers could be fired if they didn't perform, thus preserving the positive work culture. This company also had a philosophy of taking care of it's employees. And it was the top hotel in the entire city.

There is definitely a balance, there needs to be protection for workers on they will be exploited. But the last 30 years unions have got out of control and greedy and have taken companies down, and taken entire U.S. industries down (automobile industry). They can be kind of like the mafia in non "right to work" states too forcing workers to pay union dues. And then using those dues to fund campaigns of union friendly politicians. Kind of like in Sicily where the mafia forces business to pay "protection money".

Also many public sector unions are horrible and corrupt. Former CA Governor Gray Davis got elected by being in the pocket of the California prison unions and other public sector unions, and thus he rewarded them right after his election with ridiculous unsustainable pay and pension packages that have helped make California's finances be on a crazy roller coaster. And also made CA public sector employees by far the highest paid in the U.S. Much of the CA legislature is under the thumbs of public sector unions. I really believe it should be illegal for public sector unions to contribute to political campaigns. That creates so much corruption and cronyism.

Submitted by FlyerInHi on July 21, 2013 - 3:36pm.

SK in CV wrote:
FlyerInHi wrote:
The governor of Michigan has it right.

It's about accountability to the citizens of Detroit who are not getting the services they deserve.

Sorry about retirees and bondholders taking a haircut. They are the past, not the future.

Unless the entire state goes bankrupt, the retirees contracted benefits will be paid. The state is on the hook for them.

Yes, we shall see what happens in Federal bankruptcy court. I think there's something in the Michigan constitution about pensions.

Submitted by CA renter on July 21, 2013 - 10:55pm.

ctr70 wrote:
I'm not sure what unions played directly in the city of Detroit's BK. But unions (and the inflexibility they caused) were a BIG part of reducing the U.S. auto industries ability to compete with Japan. If the auto industry in Michigan were run like Silicon Valley with NO unions, things may have turned out very different. Silicon Valley has NO unions and this is a big reason why the U.S. is still #1 in much of high tech and still makes some of the best high tech products and software. The U.S. certainly does not make the best cars and has not for 25-30 years.

The U.S. automakers were destroyed by Japanese (and German) automakers who made better, higher-quality, more efficient cars. American automakers were busy making crappy cars with cheap, plastic parts that would break so that people would have to keep replacing these specialized parts for hundreds of dollars, or have to replace the cars altogether -- and management did this intentionally.

U.S. automakers gave us the Pinto and Gremlin in response to demands for more efficient cars, while Japanese and German automakers gave us the indestructible VW, and cars with advertisements showing happy owners who got 200K to 300K out of their fuel-efficient Japanese cars and trucks (with little maintenance to boot).

It was management that brought down the U.S. automakers, not unions.

----------

By 1969, imports had increased their share of the U.S. auto market, with Volkswagen selling 548,904 vehicles, followed by Toyota with 127,018 vehicles. In response to this, the domestic auto makers introduced new compact and sub-compact cars, such as the Ford Pinto and Maverick, the Chevrolet Vega, and the AMC Gremlin, Hornet and Pacer. (Chrysler had to make do with importing cars from Mitsubishi Motors and their affiliated Rootes Group.) However, design and manufacturing problems infected a number of these cars and led to unfavorable perceptions of the cars.

The auto industry was severely affected by the 1973 oil crisis Arab embargo. Small fuel-efficient cars from foreign automakers took a sharply higher share of the U.S. auto sales market. Under the Energy Policy and Conservation Act[12] the federal government initiated fuel efficiency standards (known as Corporate Average Fuel Economy, or CAFE) in 1975, effective as of 1978 for passenger cars, and as of 1979 for light trucks. For passenger cars, the initial standard was 18 miles per gallon (mpg), and increased to 27.5 mpg by 1985.

http://en.wikipedia.org/wiki/Automotive_...

Submitted by no_such_reality on July 22, 2013 - 8:33am.

What killed the American auto-industry was really simple.

The relationship between labor and the company was pure poison.

Add in greed, cynicism, incompetence and an f-u attitude or as long as I get mine and you know why it died. Those attitudes ran both sides up and down the whole range.

There's a fundamental problem when plant workers say they work for the UAW and not Ford, GM or Chrysler, or even the individual sub-brand and management is worried about their private jet.

Submitted by SD Realtor on July 22, 2013 - 2:38pm.

It is hard to admit that other employees will do the same work or even higher quality work for a fraction of the cost.

In some circles, that is simply not acceptable.

Submitted by CA renter on July 22, 2013 - 5:09pm.

no_such_reality wrote:
What killed the American auto-industry was really simple.

The relationship between labor and the company was pure poison.

Add in greed, cynicism, incompetence and an f-u attitude or as long as I get mine and you know why it died. Those attitudes ran both sides up and down the whole range.

There's a fundamental problem when plant workers say they work for the UAW and not Ford, GM or Chrysler, or even the individual sub-brand and management is worried about their private jet.

I agree about the adversarial relationship between labor and the companies they work for. In countries with strong unions and strong economies, BOTH capital and labor understand that it is a symbiotic relationship, and each is dependent upon the other in order to further their own interests.

Submitted by Hobie on July 22, 2013 - 7:45pm.

Sure there were problems with labor costs but in the mid-late '80's Toyota Celica had a 'betty' to announce if your door was a-jar. No American car had this. The wow factor coupled with a affordable price point garnered consumerism attention and money.

Market forces prevail and the cool factor of the hip, airplane cockpit gauges took hold. Detroit countered with the Pinto and Gremlin. or K car even. C-mon. The Japanese skunked us. We did not learn and they took, and continue, to take huge market share.

Simply put, with or without unions, Detroit had viable competition that is winning by delivering a better product.

Relax the enviro constrictions on manufacturing and relax the constraints of energy production and Motor City will return as we will always need lots of new cars/trucks.

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