Crunch time for US car makers and unions

FOCUS ON JOBS: US President-elect Barack Obama has declined to endorse recovery plans for the motor industry until after congressional hearings end today. 02/12/08. Pic. Jeff Haynes. © Reuters.
FOCUS ON JOBS: US President-elect Barack Obama has declined to endorse recovery plans for the motor industry until after congressional hearings end today. 02/12/08. Pic. Jeff Haynes. © Reuters.

WASHINGTON - After spending more than R3075million and providing thousands of foot soldiers to help elect Barack Obama, labour unions looked forward to good economic times, a warm relationship with a president for the first time in eight years, and quick passage of legislation designed to boost membership.

WASHINGTON - After spending more than R3075million and providing thousands of foot soldiers to help elect Barack Obama, labour unions looked forward to good economic times, a warm relationship with a president for the first time in eight years, and quick passage of legislation designed to boost membership.

But the financial crisis has jolted unions, weakening their position at the bargaining table and prompting calls to delay the pro-union legislation.

The United Auto Workers president, Ron Gettelfinger, is slated to appear on Capitol Hill today along with executives of the nation's three largest car makers.

They will be asking Congress to approve R348,5billion in loans they say would buy time to restructure and stave off bankruptcy.

They say bankruptcy would cost hundreds of thousands of jobs and possibly plunge the economy into a depression.

Instead of being able to call in their chits for having helped elect Obama, union leaders are facing an array of crises, including lay-offs, bankruptcies, contract concessions, and rising costs for healthcare and other services.

But if Obama had lost, "it would be much more terrifying", AFL-CIO policy director Thea Lee said.

Union leaders said they are grateful that Obama appears to be focusing his economic stimulus plan on creating jobs and has expressed support for helping car makers, though the president-elect declined to endorse their recovery plans until after the congressional hearings.

Critics have said the UAW is partly responsible for the auto industry's problems, citing the union's opposition to higher fuel-efficiency standards and its array of generous job and retirement benefits. - New York Times

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