Another bleak report about the US Auto industry came out today:

DETROIT (Reuters) - General Motors Corp. lost an average of $1,227 per vehicle in the first half of this year in North America, while cross-town rival Ford Motor Co. lost $139, according to new research from Harbour Consulting.

“GM has two to three people sitting at home for every single person working today and that has a huge legacy cost impact on them,” Laurie Felax, vice president of Harbour Consulting, told an automotive conference Monday. “It wipes away any profit that they have.”

I’ve been thinking about this a lot recently. The burdens of pensions and health care are destroying American industry. Past victories for unions and workers–things Democrats typically support–are now causing companies like GM and Ford serious problems. I believe very strongly both in the importance of these past victories and in the need to ensure worker safety and protection in the future, but it is time to rethink our system.

Improving Social Security and establishing universal, cradle-to-grave health care will relieve companies of serious burdens. If we don’t pay attention to this we will watch as our flagship companies grow increasingly obsolete and pathetic. What will unions have fought for if the companies that provide important benefits have to declare bankruptcy? United Airlines already used Chapter 11 to sidestep billions in owed pensions. This is the only prudent course of action.

~The Stuffed Tiger