Tuesday, July 24, 2007
Monday, July 23, 2007
Detroit's $100 billion headache
Talks with UAW over retiree health care costs crucial for survival of GM, Ford, Chrysler.
By Chris Isidore, CNNMoney.com senior writer
July 23 2007: 4:31 PM EDT on CNN
NEW YORK (CNNMoney.com) -- The survival of brands like Chevrolet, Ford and Chrysler could very well depend on whether the United Auto Workers union is willing to assume a $100 billion headache.
That's the estimated price tag of the combined liability to provide health care for retirees of General Motors (Charts, Fortune 500), Ford Motor (Charts, Fortune 500) and Chrysler Group, the unit of DaimlerChrysler (Charts) being sold to private equity group Cerberus Capital Management.
As crucial labor talks get underway between the union and the three major U.S. automakers, there is a widespread assumption among industry experts that the automakers will need to cut their labor costs by nearly a third, or roughly $20 an hour, if they're going to be able to stem huge losses in their core North American auto operations and compete with nonunion rivals like Toyota Motor (Charts) and Honda Motor (Charts).
Pay cuts aren't likely to be the answer, especially since pay of about $28 an hour for UAW members is not much out of line with what the Asian automakers are paying hourly workers at their U.S. plants. Rather, it's the promises of health care to retirees and their dependents that's seen as the crux of the problem.
As the UAW-Chrysler negotiations opened Friday, with GM and Ford kicking off Monday, the talk in the industry is about the automakers setting up a union-controlled fund that would be responsible for those retiree health care costs going forward.
Retiree health care coverage is crucial because with their shrunken hourly work forces, the number of retirees at the Big Three dwarfs active employees.
For example, GM has 432,000 retirees but only about 80,000 active UAW members at the end of last year - less than a third of the hourly U.S. work force it had in 1994. Union ranks at GM have fallen further this year due to buyouts. Between them the three U.S. automakers have less than 160,000 UAW members on staff heading into these talks.
A deal for an old-line industrial company to shed its health care promises to retirees was the crux of a labor pact reached in December between Goodyear Tire (Charts, Fortune 500) and the United Steelworkers unionthat had the company putting $1 billion into a union-controlled fund to take over its retiree healthcare obligations. The deal ended a three-month strike there.
It was also part of an agreement between the UAW and bankrupt auto parts maker Dana reached early this month. The fund for Dana retirees will have $700 million in cash and $80 million of its common stock, with the cash coming from private equity firms that are buying control of the company.
UAW President Ron Gettelfinger said Friday the Dana deal "is not a precursor for any other set of negotiations." Officials at the automakers won't comment on the record whether they're seeking a deal like the ones at Goodyear and Dana, although in January GM Chief Financial Officer Fritz Henderson told analysts and investors "it would be fair to say that we have more than a passing interest in the Goodyear agreement."
The funds set up at Goodyear and Dana are far smaller than the one that would be required for the automakers. David Cole, chairman of the Center for Automotive Research, estimates that the automakers together would have to put at least $35 billion to $40 billion into the funds at the start to cover retiree health care costs over the long run.
On the plus side for the UAW, such a fund would give it control of health care coverage for its retired members, benefits that would continue if one or more of the automakers were to go bankrupt. It also theoretically would give the Big Three a better outlook longer term, allowing them to be more competitive with the Japanese automakers who are not burdened by the retiree health care costs.
"You can't get to where you need to go without doing something on health care," said Cole. "From a membership standpoint, they're betting their future on this contract. If these companies are not sustainably profitable for the long term, they're going to go away."
But other experts say they doubt the automakers will be able to win that kind of radical cost-shifting agreement from the union, and that any savings in these labor negotiations will be modest and not enough to prevent the further steady slide in the U.S. automakers' fortunes.
"The market seems to be looking forward to a Goodyear type of arrangement, but I just don't see it," said Kevin Tynan, auto analyst at Argus Research. "That's why the move in the stock (prices) may be a bit too optimistic." GM and Ford stock have rallied about 10 percent apiece the last three months, ahead of the labor talks and despite weak auto sales.
Agreeing to take on the health care costs would put the union in the uncomfortable situation of being the one to cut benefits or coverage or raise out-of-pocket costs for its retired members if the funds assets don't perform as planned, or if health care costs rise faster than expected.
Even if the union agrees in principal to the idea of assuming the retiree health care costs, negotiating how much each automaker would have to put into a fund could prove difficult, if not impossible, experts said.
Finding those funds would be difficult as well, especially with GM and Ford debt rated as junk, which raises their cost of borrowing, and with Ford already mortgaging much of its plant and equipment to fund a turnaround effort. Cole said while the companies might prefer to use their own stock to make much of the contribution, he believes the union would be reluctant to accept that.
Both management and labor said that while they expect the negotiations will result in an agreement rather than a strike our lockout, nothing can be taken for granted. The labor contracts between the UAW and the three automakers expire Sept. 14.
"Rational negotiators look at the options," Joe Laymon, Ford's group vice president for human resources and labor relations, said at a news conference Monday. "We looked at Ron and the UAW, they're sitting on a $900 million strike fund. It does not frighten us because we think we can work with UAW and come to an agreement short of an impasse. But it doesn't negate the fact that a strike is a possibility because we could make a mistake with them or they could make a mistake with us. We don't think that will be the outcome."
While Gettelfinger would not comment on what kind of health care deal might emerge, he did say Monday that the union would continue to push for the kind of universal government-funded health care that benefits automakers from Asian or European companies.
"It's obscene what we spend on health care and what we get for it," he said. "It's disheartening to see what's happening to this industry and this country. Other countries don't have this problem. They value their auto industry. So on many things we can't do anything about in the bargaining agreement, we have to take it on in the legislative arena." Top of page
Find this article at:
http://money.cnn.com/2007/07/23/news/companies/uaw_talks/index.htm?cnn=yes
Friday, July 20, 2007
Crazy times in my old stomping ground
Crazy times!
Two 'bumbling' crooks caught in Dearborn
Tony Gonzalez / The Detroit News
DEARBORN -- The owner of a flower shop robbed Tuesday says "bumbling" crooks left behind a stolen wallet and made off with just $145 from her antique cash register before she escaped out the back door.
"Nobody makes money at a flower shop in July," said 24-year owner Debra Debolt. "If they would have done their homework they would have known."
Dearborn Sgt. David Robinson expects charges by Friday against two men arrested after an all-out search by all available officers following the 1:30 p.m. robbery of Debolt and a neighboring business.
Although Debolt froze at gunpoint, she later kicked off her sandals and bolted into an alley behind Park Flowers & Gifts, 1832 Grimley Park [blogger's note, it's GRINDLEY PARK], while the robbers searched her store.
Debolt tried to warn her neighbors, banging on doors and warning psychologist Mel Hoberman, 64, after the robbers fled her shop. Her screams came too late. Moments later, the duo robbed Hoberman at gunpoint.
Police blanketing the area arrested two men they won't identify -- one of whom was in the process of trying to pull off a third robbery in a home, police said. That man hid in the basement, unbeknownst to the resident.
"Every officer we had formed a perimeter and through house-by-house checks found one individual," Robinson said.
Police could not estimate the value of cash and jewelry stolen.
"I don't think they hit the jackpot," Robinson said.
Police are holding the men in custody pending charges. The investigation is aided by fingerprints found on the flower store counter, where Debolt noticed one robber leaning while asking about balloons before the second man entered with a gun.
Debolt said she was courteous, but was robbed of her wedding ring and anniversary band in return.
Hoberman, who was leaving his office for a golf outing, estimated he was robbed of $380 and a 70-year-old ring from his father. He said he initially stalled finding the money in his pockets but tossed it to the ground when the robber threatened to shoot his knee.
"I knew my money was in my front pocket, but I figured if I gave the lady a little time to call the police, maybe that would help," Hoberman said.
Although troubled by the robbery, Hoberman played six holes of golf with friends before being called by police to identify one of the men.
"It was good to get out and talk to my friends about what happened," Hoberman said.
The victims await the return of their stolen jewelry, including Hoberman's ring, which he said police told him was swallowed by one of the thieves.
You can reach Tony Gonzalez at (734) 462-2094 or tgonzalez@detnews.com.
Thursday, July 19, 2007
Jerry Hadley dead
Music director of the Metropolitan Opera, James Levine, had this to say, which was reposted by AP; "I particularly admired the strength and sweetness of his voice in the lyric Mozart parts and the imagination and commitment he brought to contemporary works. He was also a warm, generous colleague with a great sense of humor, who always gave his very best. ... We will miss him enormously."
His death, along with Beverly Sills death on July 3 and Régine Crespin on July5, marks three significant Met opera singers passing this month, although Hadley's death is the surprise. It was said that Hadley had been depressed and was suffering financial woes.
Wednesday, July 18, 2007
YouTube and voting
--
The YouTube-ification of politics: Candidates losing control
CNN Deputy Political Director Paul Steinhauser contributed to this story.
It was one of the most talked about moments in the 2006 campaign: "Lets give a welcome to Macaca, here. Welcome to America and the real world of Virginia."
That was then-Virginia Republican Sen. George Allen's controversial remark to a young campaign aide working for Allen's opponent, Democrat Jim Webb. The comment was caught on camera by the Webb aide, and was put on YouTube. It became a smash hit.
Allen was expected to cruise to re-election, but thanks in part to the YouTube video, Allen lost his seat by just a few thousand votes to Webb. His loss, along with the razor thin defeat of Sen. Conrad Burns, R-Montana -- who had his own damaging moments on YouTube -- helped swing control of the Senate to the Democrats.
Gotcha moments on YouTube, unauthorized campaign videos and hard-hitting debate questions from YouTube users are changing the political landscape. The YouTube "Macaca moment" represents a broad new challenge for candidates, but speaks to the age-old problem of how to control the message.
"I think it really breaks down some of the traditional barriers we have seen in American politics," Steve Grove, head of news and politics at YouTube, told CNN's John King Monday. "Time was, if you wanted to engage in a primary debate process, you had to be in New Hampshire or be in Iowa."
Grove said that CNN-YouTube's Democratic debate next week in Charleston, South Carolina, is a game-changer. The user-generated questions can touch any topic and come from anywhere in the world.
"Candidates do hate, genuinely hate, audience participation, because they like to control the environment," said longtime television news anchor Dan Rather, now the global correspondent for HDNet. Tell candidates people will ask them questions via a YouTube video, he says, and "they get the shivers."
It's those unscripted moments that have taken on a new life on the video-sharing Web site.
For Allen, that short YouTube clip, viewed millions of times, had far-reaching repercussions for his political career. Allen also lost any immediate chance at making a run for the White House.
"If not for YouTube, Allen would most likely be one of the front-runners today for the GOP presidential nomination," says CNN Political Editor Mark Preston.
When it comes to YouTube moments, the presidential campaign cycle is picking up where the midterm elections left off. While candidates try to avoid a "Macaca moment," the competing campaigns are busy dispatching video "trackers" to catch one.
A local stop on the campaign trail is suddenly a national story.
Sen. John McCain had a YouTube moment in April. "Remember that old Beach Boys song, bomb Iran. Bomb. Bomb. Bomb." That was the Republican presidential candidate having some fun with a friendly crowd in South Carolina. But his comments got played over and over again on YouTube and became a story picked up by the mainstream media.
"You cannot go to a 7-Eleven or a Dunkin' Donuts unless you have a slight Indian accent. I'm not joking," said Democratic presidential hopeful Joe Biden last July. The senator from Delaware was joking, but his comments made the rounds on YouTube, and Biden needed to clarify just what he was talking about.
YouTube is forcing candidates to deal head-on with their past. The ease at which video can be posted and distributed on YouTube is giving old debate clips new life, forcing presidential hopefuls to explain conflicting positions.
"I believe that abortion should be safe and legal." That was former Massachusetts Gov. Mitt Romney from a 1994 debate with Sen. Ted Kennedy. Romney has changed his position on abortion, but those old clips supported his critics' charge that Romney flip-flopped on abortion.
Former senator and probable GOP presidential candidate Fred Thompson is facing a similar situation. When Thompson was first running for the Senate in 1994, he was asked during a debate whether he would support or oppose laws that prohibit abortions for convenience. Thompson responded by saying, "I don't believe that the federal government should be involved in that process." That video is now making the rounds on YouTube and probably won't help Thompson's push to court social conservatives.
"Is YouTube having an impact? Of course," says Amy Walter, editor-in-chief of the National Journal's Political Hotline and a CNN Political Analyst, "but to me what's more interesting is from the strategist point of view -- which is when to react and when not to react to YouTube."
There is a flip side to the YouTube phenomenon. It can also help campaigns looking for new ways to harness the power of the popular Web site.
In April, YouTube began spotlighting one campaign each week, allowing each candidate to ask anything they want.
"What do you think our campaign song should be?" asked Sen. Hillary Clinton, the Democratic presidential front-runner.
YouTube users can talk back, or in the case of some Clinton supporters and opponents, sing back.
Sometimes the campaigns are getting help without asking.
"I got a crush on Obama" sings a young woman on a music video that was an instant hit on the site. Sen. Barack Obama's campaign wasn't behind the video, but the buzz probably didn't hurt the Illinois senator's presidential bid.
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Then there was the "Vote Different" Orwellian clip, uploaded anonymously on YouTube, which portrayed Clinton as Big Brother in a remake of an Apple Computer ad from 1984. Viewed millions of times on YouTube, the final frames pointed to Obama's presidential Web site.
Those are two perfect examples of how YouTube is empowering average Americans to affect the political process like never before. That in turn is affecting the campaigns. The candidates don't have total control over their message any more, and that's forcing them to change the way they campaign.
Tuesday, July 17, 2007
Hadley, Papitto, Kangas, Elmo
Famed opera singer Jerry Hadley was taken off life support yesterday. He had been hospitalized after a self-inflicted gunshot wound caused significant damage. Hadley is most famous to me as playing the lead in Bernstein's Candide, but also releasing recorded performances in the Bel Canto style and being one of those tenors I listened to a lot at Kalamazoo College. If you need some more background on the performer, check out wikipedia. Cnn posted the news about Hadley's removal from life support, which was taken from the associated press. It is said that he was depressed and had been in the process of filing for bankruptcy.--
In what can only be described as disgusting, Ralph Papitto, chairman of the Rogers Williams University board admitted to using the "n-word" during a board meeting. They were discussing why there was little diversity on the 16-member board. As the story goes from Cnn, he used the word as heated discussions ensued over diversifying the makeup of the board. Of course his response to the slur went something like this; "it just kind of slipped out." "I apologized for that, what else can I do? Kill myself?" and my personal favorite deflection of all time (beyond the ever-popular "I have black friends so I'm not racist") he responded in an interview by saying "The first time I heard it was on television or rap music or something." To make matters worse, it was reported the Papitto immediately told the board after the slur that he should not have said the word because of what had happened to Don Imus. That's just great, Ralph. Beacuse of Don Imus. Not because it's an awful word.
That article really gets me mad. There is no standard by which the n-word should be judged so that people like Papitto can be exhonerated. In other words, it isn't a standardized word because it gets used in rap or on television. His reference to learning the word from those sources is a low blow and rather childish. Logic would say the same for many phrases and comments. For instance if an 8 year old kid says to me "I'm going to punch you in the face," that means something different than if a big huge angry-looking body-builder type says it to me immediately after I accidentally knock a glass of water on him at the local restaurant. It's just wonderful [read as sarcasm] that this guy Papitto not only used the word in an official professional meeting, but said he should not have use it because of IMUS...not because it was an inappropriate word. And deflecting it to rap and television is tacky and tasteless. He also seems to have little remorse for the incident. "I apologized for that, what else can I do? Kill myself?" No, but maybe take the blame totally. The infamous n-word means something inappropriate when the founder of a Fortune 500 company says it, sorry Ralph. What makes it more disturbing is that it seems obvious that his remorse is for being caught, not for saying it. And speaking is just the user illusion of thinking anyway.
It's interesting that overtly racist people tend to suddenly be inclusionary of the people they are racist against when their own respect is at risk. Suddenly, when they are in trouble, they include themselves with the people they usually want to distance themselves from. Papitto is just like Dave Chappelle suddenly. Next time Papitto gets an award for his big buisness, or gets another law school named after him, let's see if he lumps himself in with 50 Cent then.
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Speaking of Business...I've been meaning to post a bunch of Paul Kangas clips for some time. He's the face of Nightly Business Report on PBS. He had a great role in that film The Game with Michael Douglas.
And last but not least today, Elmo with Robert DeNiro. I may be the only one that thinks this is totally ridiculous and hilarious.
Monday, July 16, 2007
Review from Mott Community College.
"This self titled album is like nothing I have ever heard before. The haunting voice of Mike Vasas is eerily similar at times to the late great Jeff Buckley; other influences such as Neil Young and Elvis Costello are evident and give the uniqueness that I came to love about it.This album doesn't fit into any one genre, it touches on a little of everything, remaining experimental in all. Through the use of different instruments like synthesizers, mandolins, electric pianos, tuned bowls, and even vibraphones just to name a few, give this album an edge that nothing could compare to. I have heard many an album when bands try something that is unconventional and it blows up in their facers. It is so refreshing that Mike & The Beasts not only pull it off, but make it their own.
Mike Vasas & The Beasts of Burden is the type of band that anyone can listen to, no matter what genre you are "into", this album spans through them all. Listening to this album gives you a little taste of everything. If you are looking for something amazingly different, then look into Mike Vasas & The Beasts of Burden. You can find their music and more information on Mike & The Beasts at www.mikevasas.com, www.myspace.com/mikevasas, or you can check out Mike Vasas's record label at www.grammyhallrecords.com. This band and this album are the best I have come across in a while, check them out, you won't be disappointed."-Amanda Emery; Mott Community College Chronicle.
The blog is back...in a big way.
"A strange loop arises when, by moving up or down through a hierarchical system, one finds oneself back where one started. Strange loops may involve self-reference and paradox. The concept of a strange loop was proposed and extensively discussed by Douglas Hofstadter in Gödel , Escher, Bach, and is further elaborated in Hofstadter's book I Am a Strange Loop,
which appeared in 2007."
Wikipedia.
And let's forget that topic and go on to two really random videos.
I also wanted to make a statement. Recently, I heard somebody in Ann Arbor slamming youtube during a public performance of her work. She asked a crowd how many people liked youtube, and said she was glad more people didn't use it because "most people have better things to do with their time." I suppose she felt great saying it, suggesting, of course, that she was able to do something "better" than youtube. So, what's better? VH1? The Food Network? Local news? Sitcoms? DVDs? Laserdiscs? VHS tapes? Beta?
In the movie Short Circuit 2, Robot # 5, known as "Number Johnny 5," was interested in input, not specificity. I suppose youtube has archived a bunch of stuff that doesn't need to be archived, but that's the entire idea. People can look for whatever they want and usually find something. Plus, video is video...whether it's from a computer screen watching old commercials from 1983 or whatever new incarnation of seinfeld or mad about you they are trying to push on network TV. Most importantly, it seemed as though her audience that didn't use youtube were people who listened to loud rock music in the 60s and 70s, who grew up watching a television that wasn't as good as the radio with the generation before them, and before them it was how radio was ruining live performance, etc. And of course the point is, maybe people were better off seeing live theater instead of movies, live concerts instead of recordings, choir performances instead of rock shows, etc...but this is where we are now. She deserves to hold her opinion, and that's fine. I don't agree with it.
And to further express how I don't agree with it, I'm going to include possibly the most pointless youtube video I've ever seen, but hilarious...and an example of how youtube is worthwhile...otherwise, how would you see the following example?
