A new paradigm

An interesting article from The Detroit Free Press this morning points out an interesting twist to the new UAW agreements with Ford and GM. With the shift of retiree health care from being a corporate responsibility to being a responsibility of a trust being managed by the UAW, the two companies gave the UAW the ability to convert debt owned by Ford and GM to the trusts into stock in the company. This gives the UAW the potential to own 16% of GM and 15% of Ford.

The potential for this is staggering: instead of an adversarial relationship, this would turn GM and Ford into a company which is largely employee-owned; basically the world's two biggest co-op companies. This would help hasten the company towards the new paradigm they need for survival: cooperation between the Union and the companies in order to beat back the non-Union foreign automakers, the Democrats trying to give amnesty to illegals and dramatically increase CAFE standards, and to reach broadly into new foreign markets and take control of the North American market once again.

UAW's new role: Shareholder
Health trust could own key chunks of Ford, GM
The Detroit Free Press

The UAW, traditionally a mighty force in the struggle of Labor against Capital, could be on the brink of a new role: Detroit's biggest stockholder.

New 4-year labor agreements that UAW members ratified with the Detroit automakers shift retiree health costs to an independent trust under the auspices of the union, which could take control of hundreds of millions of shares of General Motors Corp. and Ford Motor Co. The fact that the UAW could virtually be holding almost one-sixth of the equity in the nation's two biggest automakers could drive profound changes in the way the union thinks and acts, experts say.

"Equity as part of the VEBA does bring the UAW membership into being an investor group," said David Cole, chairman of the Center for Automotive Research in Ann Arbor.

"What we are witnessing is the transformation from a confrontational way of working to one of collaboration, which is absolutely necessary."