Buzz Wants to Make Autos an Election Issue

[Canuck E Stan]

Union Wants Autos to be Issue in Election

"The way to solve the problems of the auto industry today is to stop the imports from killing us or get the opportunity to export to those nations that won't let us sell our products today," Hargrove told CAW leaders on Friday.

Maybe better build cars would help sell CAW built cars.

[theloniusfleabag]

Dear Canuck E Stan,

Maybe better build cars would help sell CAW built cars

??? (sp)

I am in agreement, and I think we should let the unions bankrupt the companies. Then, abolish unions. After that, perhaps someone will start making competitive products.

[Riverwind]

Maybe better build cars would help sell CAW built cars.

Personally, I don't see the difference between a plant owned by Toyota or a plant owned by GM. Both plants are owned by foreign corporations and provide jobs relatively good paying jobs for Canadians, however, the jobs at the Toyota plant are not unionized so they don't count (according to Buzz).

[Argus]

Union Wants Autos to be Issue in Election

"The way to solve the problems of the auto industry today is to stop the imports from killing us or get the opportunity to export to those nations that won't let us sell our products today," Hargrove told CAW leaders on Friday.

Maybe better build cars would help sell CAW built cars.

<{POST_SNAPBACK}>

You're right, but there's more to it than that. Most of the Hondas, Toyotas, etc, which are sold here are not made here, and most of their parts are not made here. Most are shipped in from Korea and Japan. And both nations put all sorts of trade barriers in front of those who would export cars to their countries. If we made the same kind of nitpicking inspections of every Japanese car, for example, at the wharf, that the Japanese insist on for North American cars you'd have car carriers backed up all the way to Japan.

[ceemes]

Union Wants Autos to be Issue in Election

"The way to solve the problems of the auto industry today is to stop the imports from killing us or get the opportunity to export to those nations that won't let us sell our products today," Hargrove told CAW leaders on Friday.

Maybe better build cars would help sell CAW built cars.

<{POST_SNAPBACK}>

You're right, but there's more to it than that. Most of the Hondas, Toyotas, etc, which are sold here are not made here, and most of their parts are not made here. Most are shipped in from Korea and Japan. And both nations put all sorts of trade barriers in front of those who would export cars to their countries. If we made the same kind of nitpicking inspections of every Japanese car, for example, at the wharf, that the Japanese insist on for North American cars you'd have car carriers backed up all the way to Japan.

<{POST_SNAPBACK}>

Have you checked under the hood of your North American car lately? Odds are a large percentage of contains component from Asia, and in some cases, the whole damn thing was build overseas and shipped here.....after being rebadged that is.

The trouble with North Amercian manufactures have cracking the Asian export market area:

A) Quality, hate to say it, but Ford, GM and Chylser products are crap, especially the smaller models.

Size, we here in NA have a hard on for power and size, bigger, faster is better. Trouble is, most Asian nations and drivers do not want nor can use a gas guzzling SUV or whatever.

C) Costs. You can get more car for your Yen or CNY by buying Asian then you can by buying NA imports.

This all being said, there is some export of NA built cars to Asia, just not as many as coming in from that part of the world.

And here is something else for you to consider. The most popular highway tractor on our NA highways is now Volvos, not Macs, Peterbuilds or Kenworths.

[err]

You're right, but there's more to it than that. Most of the Hondas, Toyotas, etc, which are sold here are not made here, and most of their parts are not made here. Most are shipped in from Korea and Japan. And both nations put all sorts of trade barriers in front of those who would export cars to their countries. If we made the same kind of nitpicking inspections of every Japanese car, for example, at the wharf, that the Japanese insist on for North American cars you'd have car carriers backed up all the way to Japan.

How true... They can build a big plant here and say... Look, made in Canada... and then ship 6 in for every one built here..... And most Canadians will fall for it, hook, line and sinker....

[cybercoma]

Funny how your cavaliers and sunfires had their bodies put on in California, meanwhile civics and one of the toyota models is made right here in Ontario and we're advocating GM over foreign manufacturers. I don't get it.

[Argus]

Funny how your cavaliers and sunfires had their bodies put on in California, meanwhile civics and one of the toyota models is made right here in Ontario and we're advocating GM over foreign manufacturers.  I don't get it.

<{POST_SNAPBACK}>

Canada makes a lot more NA cars and produces a lot more NA car parts than it consumes. We are overwhelmingly benefiting from the proximity to the US. While some of the NA cars are built there, a lot are built right here and shipped to the US, and anything which damages the North American automobile manufacturing damages Ontario's economy - which damages Canada.

I agree that NA cars sometimes have more of a quality issue than Asian cars, though that is not always true (Kia anyone?). On the other hand, the car itself, and parts and repairs tend to be cheaper. We also have problems with rust (snow and salt) which the Asian countries don't have. The point is, however, that Asian governments put up roadblocks to the importation of NA cars which, if we mirrored them, would hamstring their economies. If NA cars have such a poor level of quality then Asian buyers will not buy them, or at least, not for long, so why the roadblocks?

[cybercoma]

Funny how your cavaliers and sunfires had their bodies put on in California, meanwhile civics and one of the toyota models is made right here in Ontario and we're advocating GM over foreign manufacturers.  I don't get it.

<{POST_SNAPBACK}>

Canada makes a lot more NA cars and produces a lot more NA car parts than it consumes. We are overwhelmingly benefiting from the proximity to the US. While some of the NA cars are built there, a lot are built right here and shipped to the US, and anything which damages the North American automobile manufacturing damages Ontario's economy - which damages Canada.

I agree that NA cars sometimes have more of a quality issue than Asian cars, though that is not always true (Kia anyone?). On the other hand, the car itself, and parts and repairs tend to be cheaper. We also have problems with rust (snow and salt) which the Asian countries don't have. The point is, however, that Asian governments put up roadblocks to the importation of NA cars which, if we mirrored them, would hamstring their economies. If NA cars have such a poor level of quality then Asian buyers will not buy them, or at least, not for long, so why the roadblocks?

<{POST_SNAPBACK}>

i don't disagree with you about the roadblocks. It seems silly that we allow Asian cars to be sold here, when they won't allow NA cars sold over there. The problem is having a truly free market then either 1) telling NA manufacturers they're not allowed to sell to Asia or 2) telling Asian manufacturers they're not allowed to sell to NA. I think the best solution would be getting Asia to open their doors to American cars and I'm sure it's only a matter of time at this point. The Chrysler 300 will be built in (correct me if I'm wrong here) Shanghai starting next year, I believe. Once they start producing the cars, they'll begin allowing them to be sold in the country. Who knows. The current situation is BS though, you're right.

[August1991]

Most of the Hondas, Toyotas, etc, which are sold here are not made here, and most of their parts are not made here. Most are shipped in from Korea and Japan. And both nations put all sorts of trade barriers in front of those who would export cars to their countries. If we made the same kind of nitpicking inspections of every Japanese car, for example, at the wharf, that the Japanese insist on for North American cars you'd have car carriers backed up all the way to Japan.

It seems silly that we allow Asian cars to be sold here, when they won't allow NA cars sold over there. The problem is having a truly free market then either 1) telling NA manufacturers they're not allowed to sell to Asia or 2) telling Asian manufacturers they're not allowed to sell to NA. I think the best solution would be getting Asia to open their doors to American cars and I'm sure it's only a matter of time at this point.

It is irrelevant whether Asians want to buy our cars or not, or what restrictions Asian governments may impose on importing our products. These are issues beyond our control. At present, Asians must be satisfied with whatever we send them because they, apparently, keep sending us in return good quality, inexpensive cars.

As I have argued elsewhere, the sun sends us sunlight and refuses to allow us to export anything in return. According to the logic of the two posts above, we should immediately start trade negotiations with the sun and insist it open its markets to our exports. And if it doesn't, we should retaliate by refusing to accept any more sunlight. After all, the long term health of our economy depends on our export industries.

[Riverwind]

If NA cars have such a poor level of quality then Asian buyers will not buy them, or at least, not for long, so why the roadblocks?

I think you are mixing cause and effect, if there was a significant demand for the US products then the consumers would demand that procedures be expidited. If the Canadian govenment tried to do the same with Japanese imports they would find the biggest complainers would be Canadians that want to buy Japanese vehicles.

The reality is, the big three can only sell product in NA because they sell it cheap compared to the imports. If the big three want to sell to into Japan and Korea then they would have to sell them on price - an extremely difficult thing to do given the wages and benefits demanded by CAW workers in NA.

For that reason, if I was an executive at the big three, I would not waste my time trying to get product built in North America shipped to Japan. I would set up a new factory in China and ship the product from there. In fact, that is what I believe the big three are doing already.

[Canuck E Stan]

Exactly, the big three are building over there even Cadillac is building in China.In time it will be the big three cars that will be imported to NA. Just like all the other NA manufacturing products we used to build in NA(cameras,typewriters,stereos,TVs,ect.) the auto will be another item foreign made. Appliances made in Ontario,is the next to go foreign(Mexico) after Inglis was recently bought out by a US company that does all their washer and dryer work in Mexico. Even the lowly cigarette work is being shipped to Mexico and costing Ontario 550 jobs.

Why would the auto be any different? We did nothing to save these other goods when there were made in Canada.

What Canada needs is a Canadian made auto,made for Canada and not a US subsidiary made vehicle or a foreign branch auto manufacturing plant. Even countries like Brazil are producing their own auto.

The government has to help in the developement of a Canadian auto and not keep putting $$ into Foreign manufacturing plants.

We need vehicles that are fuel efficient,anti-corrosive and less reliant on oil.

[shoop]

For Japan at least, there aren't as many tariff/trade roadblocks as people think. Things have changed a lot since Lee Iacocca went on his anti-Japan rampage 15 years ago. There are problems with supply chains, etc. But they can be overcome. For example, it is incredible to see how many Starbucks sprouted up in Japan in the last 7 to 8 years.

A big part of the issue is what the Japanese will buy. The only really successful foreign cars in that market are the big luxury/status type vehicles. Why on earth would a Japanese consumer want a Chevy Cavalier. They aren't anywhere near as fuel efficient as what you can buy domestically and they cost much more due to shipping costs.

GM tried to push it's Saturn brand on Japan. That failed miserably. In large part due to terrible marketing. "A polite kind of company, a polite kind of car." Was the tag line they tried to use in Japan.

Needless to say it failed miserably....

I agree that NA cars sometimes have more of a quality issue than Asian cars, though that is not always true (Kia anyone?). On the other hand, the car itself, and parts and repairs tend to be cheaper. We also have problems with rust (snow and salt) which the Asian countries don't have. The point is, however, that Asian governments put up roadblocks to the importation of NA cars which, if we mirrored them, would hamstring their economies. If NA cars have such a poor level of quality then Asian buyers will not buy them, or at least, not for long, so why the roadblocks?

<{POST_SNAPBACK}>

[Argus]

It is irrelevant whether Asians want to buy our cars or not, or what restrictions Asian governments may impose on importing our products.  These are issues beyond our control.  At present, Asians must be satisfied with whatever we send them because they, apparently, keep sending us in return good quality, inexpensive cars.

It would be much better for our economy if we built the cars here.

As I have argued elsewhere, the sun sends us sunlight and refuses to allow us to export anything in return.  According to the logic of the two posts above, we should immediately start trade negotiations with the sun and insist it open its markets to our exports.  And if it doesn't, we should retaliate by refusing to accept any more sunlight.  After all, the long term health of our economy depends on our export industries.

<{POST_SNAPBACK}>

The Sun does not cost us anything.

[Argus]

If NA cars have such a poor level of quality then Asian buyers will not buy them, or at least, not for long, so why the roadblocks?

I think you are mixing cause and effect, if there was a significant demand for the US products then the consumers would demand that procedures be expidited. If the Canadian govenment tried to do the same with Japanese imports they would find the biggest complainers would be Canadians that want to buy Japanese vehicles.

The reality is, the big three can only sell product in NA because they sell it cheap compared to the imports. If the big three want to sell to into Japan and Korea then they would have to sell them on price - an extremely difficult thing to do given the wages and benefits demanded by CAW workers in NA.

<{POST_SNAPBACK}>

Nothing you say has any relevence to the argument. If the NA automakers can't sell in Asia because of whatever reason, quality or price, then there's no reason for the Asian governments to put road blocks in the way of imports.

[Argus]

Exactly, the big three are building over there even Cadillac is building in China.In time it will be the big three cars that will be imported to NA. Just like all the other NA manufacturing products we used to build in NA

China is a different situation entirely. It's worse than the other Asian countries in its protectionism. And while the US automakers might build factories there, to supply that market, they need to have Chinese government "partners" who will demand huge bribes, steal all the plans, and then open other factories there to pump out copies under a different name. In addition, of course, GM or whomever, will only make paper profits over there, as there are restrictions, both written, and unwritten, on taking money out of China. They will have to use their profits, if any, to build more factories over there. All of which could be nationalised one day if a new dictator thinks things are not to his liking.

[Canuck E Stan]

Seven Point CAW plan

Union leaders also endorsed a seven-point action plan

1. a no-concessions stance.

2. early discussions between management and labour in the face of financial crises.

3. a refusal to handle parts from companies which have outsourced some of their work.

4. a fight for a fair-trade policy.

5. pension and retirement protection in the wake of bankruptcy filings.

6. increased efforts to organize non-union plants.

and of course....

7.increased government assistance for financially plagued companies

Many items that show they how much they are willing to sacrifice in order to keep their jobs.

And of course more hand-outs from the government....again.... and again.

[August1991]

It would be much better for our economy if we built the cars here.

Would it be much better for your household if you personally made your own clothes at home? (And should I be the judge of that question just as you, apparently, have appointed yourself judge for making cars in North America.)

The Sun does not cost us anything.

Argus, precisely. We can get cars from Asia at a lower cost than if we were to make the cars ourselves - exactly like the Sun. Whether Asians take our cars or not is irrelevant.

----

Argus, I have the impression that you personally don't want to trade with Asians. Fine, that is your choice. But what right do you have to force me not to trade with Asians if I choose to?

[BHS]

Seven Point CAW plan

Union leaders also endorsed a seven-point action plan

1. a no-concessions stance.

2. early discussions between management and labour in the face of financial crises.

3. a refusal to handle parts from companies which have outsourced some of their work.

4. a fight for a fair-trade policy.

5. pension and retirement protection in the wake of bankruptcy filings.

6. increased efforts to organize non-union plants.

and of course....

7.increased government assistance for financially plagued companies

Many items  that show they how much they are willing to sacrifice in order to keep their jobs.

And of course more hand-outs from the government....again.... and again.

<{POST_SNAPBACK}>

1) Meaning, "The following six items are non-negotiable". Quite a demand, coming from a party bargaining from a position of weakness. But then Buzz always did have a certain flare for self-hype and bravado. This will be the second demand to go out the window (immediately following whichever other demand is given up first.)

2) I'm wondering what this really means. My guess is that the union reps want to be consulted on management decisions, thus placing themselves on both sides of the fence. Conflict of interest?

3) This is just silly, and will probably be the first demand to be dropped when push comes to shove.

4) I'm curious about this demand. On the one hand, we have the unions using their leverage in a key financial sector to insinuate themselves into political policies that don't directly relate to their contract, and are therefore beyond the scope of anything they are legitimately concerned with. Which is typical - the unions are as much a force for political activism as they are for labour representation and have been for decades. What I'm curious about is their concern for third world farmers enjoying an international price-fixing scheme, that will almost certainly hurt farm workers (from a labour perspective) in the first world. Fair trade is socialism at it's blinkered best and would naturally have an emotional appeal for union types, but then again the unions are among the most ardent of protectionists when it comes to policies that hurt domestic markets. I guess the CAW is only protectionist when their own members are at risk, and let the rest of the country's working people be damned.

5) This means getting the big three to use all of their economic weight and political pull to have jittery Liberals and their NDP supporters put every taxpayer in the country on the hook for pension plans that we've never been a party to in any way. So the unions use strong-arm tactics to win lavish pensions, the car companies' executives take the easy way out and raid the pension funds to keep everything afloat during recessions, and years later I'm held responsible for paying for golf club membership fees and a new Mercury every two years for a guy who retired making three times as much as I do. On top of whatever he gets out of what I already pay him through the Canada Pension Plan. And the sad part is, this is the demand most likely to be met, because it hurts neither the union nor the company nor the politicians.

6) Typical union demand, and not worth further examination. RESISTANCE IS FUTILE.

7) This goes hand-in-glove with demand 5. The government of Canada has a long history of intervening in the finances of troubled companies, including the auto manufacturers. Perhaps as a pre-condition to meeting this demand the government will require the big three to build any future facilities in Quebec, to simplify things.

[Argus]

It would be much better for our economy if we built the cars here.

Would it be much better for your household if you personally made your own clothes at home? (And should I be the judge of that question just as you, apparently, have appointed yourself judge for making cars in North America.)

The Sun does not cost us anything.

Argus, precisely. We can get cars from Asia at a lower cost than if we were to make the cars ourselves - exactly like the Sun. Whether Asians take our cars or not is irrelevant.

August, what you appear to be saying is that anyone who can make things cheaper than us ought to do so and ship it here for us to buy. Nice theory. But given most of the world can make almost anything cheaper than us that leaves us with no work to do. If we buy all our goods abroad, what happens to our economy? If all the high-paying manufacturing jobs, all the IT jobs, all the design jobs, all the editing and writing jobs, all the engineer and scientific jobs drift to Asia, South American, etc., what is left for Canadians to do? Cut down trees?

----

Argus, I have the impression that you personally don't want to trade with Asians.  Fine, that is your choice.  But what right do you have to force me not to trade with Asians if I choose to?

<{POST_SNAPBACK}>

I'm bigger than you.

[Riverwind]

If all the high-paying manufacturing jobs, all the IT jobs, all the design jobs, all the editing and writing jobs, all the engineer and scientific jobs drift to Asia, South American, etc., what is left for Canadians to do? Cut down trees?

The market has a wonderful way of self correcting. If and when this happens the standard of living and wages in this country will drop until it is "competitive" with other countries. That would allow us to establish a new equilibrium where the standard of living everyone is about equal everywhere and the jobs are distributed randomly across countries. The argument that free traders make is the pie grows bigger so we don't need to worry about a drop in standard of living. Consider the following numbers:

Today: Developing World: 20, Industrialized World: 100, Pie = 120

Future: Developing World: 60, Industrialized World: 80, Pie = 140

As you can see, this scenario shows that it is possible for the pie to get bigger but the share of that pie which industrialized countries enjoy actually drops. There is nothing in free trade theory that says the pie will always grow fast enough to ensure entire countries will never end up losers. In fact. most free trade opponents will acknowledge that some people always end up poorer because of free trade - they just refuse to acknowledge that the group of people who end up losing from free trade could easily represent 50-60% of the population of Canada.

[fellowtraveller]

We're all just rearranging the deck chairs on the Titanic.

Canada has many high quality jobs dependent on the NA auto industry, which is in a major downward spiral with no end in sight.

We can expect major US government intervention soon, and it will no doubt involve less jobs for Canada, more jobs for the USA. That protectionism will inevitably affect Canadian operations for Japanese carbuilders, since their plants in Canda mainly serve the US market, not ours.

Buzz doesn't want to talk about that, or add it it to his plan though.

[August1991]

Today: Developing World: 20, Industrialized World: 100, Pie = 120

Future: Developing World: 60, Industrialized World: 80, Pie = 140

Sparhawk, I am happy that you admit the positive benefits of trade and I even admire your use of mathematics to demonstrate an example. You insist however in seeing trade as a win-lose situation by your arbitrary division of the spoils. Free (or voluntary) trade isn't like that. In a sense, you can always take your marbles and go home.

Let's be clear about all this. It is true that new technology (or a new trade opportunity) will make some tasks obsolete and the people who accomplish those tasks will have to do something else. You see this as a potential for loss and in that sense, you are right. No one can argue with you that horse traders lost their jobs when cars arrived on the scene, or typewriter repairmen lost theirs when personal computers arrived. In a slightly more sophisticated form, the idea goes by the name of the Stolper Samuelson theorem.

To understand the idea better, imagine Americans can buy cars (same quality) made in China cheaper than those made in Ontario. It is as if Americans have discovered a new technology (China) and no longer need typewriter repairmen (Ontario). What can Ontario do? Ask the US government to impose high tariffs on imported Chinese cars so Americans will buy Ontario-made cars instead? I have never heard anyone on the anti-trade Left advocating such a policy.

Imagine now that we replace 'Americans' with 'Albertans' in the paragraph above. Hey, forget 'Albertans', how about 'Ontarians not making automobiles'? If the federal government does anything to make Chinese cars more expensive, that just impoverishes people in Canada who don't make cars. Countries don't get rich by making more people poorer than the few it makes richer. IOW, we could make a few typewriter repairmen richer if we forbid the use of personal computers.

So, Sparhawk, I suppose your idea is right if everyone in Canada is the world trade equivalent of a typewriter repairman who, furthermore, refuses to do anything else in life except repair typewriters.

That would allow us to establish a new equilibrium where the standard of living everyone is about equal everywhere and the jobs are distributed randomly across countries.

Equal everywhere? Forget continents or countries, how about cities? Why do places like Westmount, Rosedale or Shaughnessy exist? (I know why Rockcliffe exists but that's a separate question... )

August, what you appear to be saying is that anyone who can make things cheaper than us ought to do so and ship it here for us to buy. Nice theory. But given most of the world can make almost anything cheaper than us that leaves us with no work to do. If we buy all our goods abroad, what happens to our economy?

We'll live the life of the idle rich. Foreigners will send us all that stuff and ask for nothing in return.

I'm bigger than you.

*giggle*

[Argus]

If all the high-paying manufacturing jobs, all the IT jobs, all the design jobs, all the editing and writing jobs, all the engineer and scientific jobs drift to Asia, South American, etc., what is left for Canadians to do? Cut down trees?

The market has a wonderful way of self correcting. If and when this happens the standard of living and wages in this country will drop until it is "competitive" with other countries.

No thank you. Given the standard of living in developing countries our standard of living would have to drop into the toilet.

That would allow us to establish a new equilibrium where the standard of living everyone is about equal everywhere and the jobs are distributed randomly across countries. The argument that free traders make is the pie grows bigger so we don't need to worry about a drop in standard of living. Consider the following numbers:

Today: Developing World: 20, Industrialized World: 100, Pie = 120

Future: Developing World: 60, Industrialized World: 80, Pie = 140

I would suggest to you that the numbers are closer to: Developing world 3, Industrialized world 100. The equilibrium would probably be closer to ten or fifteen. I would support massive protectionism rather than let our standard of living drop that low.

[Argus]

Let's be clear about all this.  It is true that new technology (or a new trade opportunity) will make some tasks obsolete and the people who accomplish those tasks will have to do something else.  You see this as a potential for loss and in that sense, you are right.  No one can argue with you that horse traders lost their jobs when cars arrived on the scene, or typewriter repairmen lost theirs when personal computers arrived. 

The difference, August, was that typewriter repairmen then became PC repairmen. Horse traders became auto dealers. What we're talking about here is not the replacement of one type of job with another but the elimination of a job entirely with no substitute.

August, what you appear to be saying is that anyone who can make things cheaper than us ought to do so and ship it here for us to buy. Nice theory. But given most of the world can make almost anything cheaper than us that leaves us with no work to do. If we buy all our goods abroad, what happens to our economy?

We'll live the life of the idle rich. Foreigners will send us all that stuff and ask for nothing in return.

They'll have to, cause we won't have the money to pay for new TVs, computers, cars or much of anything else. We'll all be working at Macjobs. As to trade - trade works only if it's TRADE. We trade one thing for something else. If all we do is buy then what you've got is a huge outflow of money every year. Huge trade deficits are not good for an economy.