In 1970, a 67-day strike against GM won, Ingrassia reports, "the company's 400,000 hourly workers (triple what the Big Three's combined total would be 40 years later) a 30 percent wage hike over the next three years." Soon thereafter, workers could retire at any age with a full pension after 30 years on the job. "If the retiree lived to be 79 or older," Ingrassia writes, "he or she would spend more years drawing a full pension than actually working."
Those still working did so under rules so complex that the table of contents of the contract was almost 20 pages long. Other autoworkers were unenthralled by such UAW triumphs: In 1986, the UAW abandoned its attempt to unionize Honda's Marysville, Ohio, plant by secret ballot plebiscite. It did not have the votes. Today, organized labor wants "card check" organizing so it can dispense with secret ballots.
By the turn of this century, GM was being kept afloat by its financing arm, GMAC, which was deeply into subprime mortgages. Ingrassia dryly notes: "Some GM dealers in Southern California were taken aback when customers bristled at being asked to fill out a GMAC credit report for a car loan. They hadn't needed a detailed credit report to get a mortgage from GMAC on their new home."
Studebaker shut down in 1966, and American Motors was absorbed by Chrysler in 1987. But compassionate government has stopped the Darwinian culling of the herd.
When Washington bailed out Chrysler in the late 1970s, Alan Greenspan, then a Wall Street consultant, said the danger was not that the rescue would fail but that it would work, thereby whetting Washington's appetite for interventions. The bailout "worked" in that the government made money from it and Chrysler survived to be rescued 30 years later by an administration that, as a wit has said, can imagine the world without the internal combustion engine but not without Chrysler.
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