Another Cause of the Economic Doldrums

By May 28, 2008Economy, Labor Unions

In all the finger-pointing over the not-quite-a-recession the economy is currently struggling through, how is that the United Auto Workers have so successfully escaped any blame? In case you missed it over the Memorial Day weekend, this Detroit News piece is quite striking, so to speak:

The American Axle strike and separate walkouts this month at two General Motor Corp. plants will take $2.8 billion off the automaker’s bottom line, and cost the U.S. economy $8.2 billion — shaving nearly a percentage point off the gross domestic product, an economist said Friday.

The 87-day walkout against American Axle & Manufacturing Holdings Inc, which ended Thursday, cost GM 330,000 units of production, including 230,000 units in April and May, the automaker reported in a Security and Exchange Commission filing Friday. United Auto Workers strikes against GM plants near Lansing and Kansas City erased 33,000 production units in the second quarter.

The loss of that factory output and related fallout, represents a 0.9 percent decline in the country’s GDP, said Mike Montgomery, an economist with Global Insight Inc.

Was it worth it? From a UAW news release:

“This has been a difficult process for American Axle workers and there is no doubt that they stood strong through it all,” said UAW Vice President Jimmy Settles, director of the union’s American Axle Manufacturing Department.

Well, that doesn’t answer the question, does it?

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