Monday, April 17, 2006

Hard Times At GM

The automotive division of General Motors, the world's largest provider of pension, health and other employee benefits, will be going down shortly, but at least its workforce will be staying up:

Viagra, Cialis and other erectile dysfunction drugs are costing General Motors Corp. a hefty sum.

The company spends $17-million (U.S.) annually on such drugs, said GM spokeswoman Sharon Baldwin.

Although that's a small fraction of GM's overall health care costs, which in 2005 were more than $5-billion, company executives often use the example to illustrate what they say are out-of-control health-care costs.

The world's largest auto maker lost $10.6-billion last year and says skyrocketing health-care costs are partly to blame. GM provides health care for 1.1 million employees, retirees and dependents.

Viagra is covered under GM's labour agreement with the United Auto Workers union, as well as benefit plans for salaried workers.

Think of how much more wisely this $17 million could have been spent, even under GM's sprawling benefits system. A relatively small sum, to be sure, but symptomatic of how the UAW and GM's continual surrender to its extortionate demands are about to destroy a corporation that was once as emblematic of American business in its time as Microsoft is now.

Like the infamous rubber room where GM pays people not to work. Even France doesn't have something this outrageous.

1 comment:

Anonymous said...

The Union fought for extended Medical benefits to relatives of retired or disabled workers forced out early, this has resulted in roughly $60 Billion in unfunded expected liabilities in the near future if everything stays the same.
Several years ago I heard the Union bosses whine about how the taxpayers should support the high paid jobs that keep the economy going , but I wondered why the workers couldn't see the writing on the wall and apply for a Job at the Toyota Plant or Honda one in Alliston.
My tax dollars shouldn't be going to pay for a high-salary job to make a product people aren't buying or have little faith in the quality.
Buzz Hargrove's answer is to try to make the Toyota and Honda Plants Unionized to keep the Due's coming in to support the inverted pyramid structure within the Union management.
I have no problem with paying $30,000 for a $30,000 dollar car, but I will not pay $30,000 dollars for a 15,000 dollar car just to keep "Good old Bill" employed with 6 weeks holidays,generous pension and benifits, seniority that forces the new young workers to get the boot from slow downs, and get about $30.00 an hour to put a wheel on a car or stick pieces of trim on the door or trunk.