There are some really good points here. Among them:
[F]inancial executives have been fired in large numbers and taking pay cuts that reduced their income to a fraction of what was expected six months ago. Auto workers have not. Financial firms are in the process of laying off hundreds of thousands of their best paid workers (50,000 at Citibank alone); auto firms are not. …
[V]arious investment banking groups that specialized in equity and corporate bonds and wouldn't have known a CDO if it bit them on the ass; corporate and muni bond traders; cap markets guys, and so forth. All their markets dried up because of a credit crisis that they cannot even arguably be credited with creating. It's no more fair that they have to sell their house … and try to figure out what the hell they're qualified for, than that autoworkers have to. Less, maybe, because the autoworkers have had a lot of warning that their companies are on shaky ground … Apparently the message we want to send is "Don't go look for a high-paying job; get a picturesque one." …
No one in the financial industry declared that their salaries and perks weren't on the table until some vague and unspecified date in the future, as the UAW has. Actually, from what I understand, the CEO of Lehman tried to, and he was rightly told to go piss up a rope. …
The financial industry was bloated, the salaries out-of-whack with any possible real economic value they could be argued to have provided to anyone, and that will have to change--but we don't need the government to ensure that, because the industry is contracting rapidly, and the worst-hit parts are exactly the places that were most out of line with economic reality. …
And I think that most of the people who Hilzoy thinks of as picking on the auto workers would be willing to accept a deal in which the Big Three got some funds in order to put its balance sheet back together, then started firing people at will until they were small enough to make a profit again.
I've thought a lot about things like this, especially the loss of low-skill, relatively high paying jobs. On the one hand, I like the kind of social order where someone can go get a goodish job right out of high school and raise a family on that (even though I really don't understand those kinds of people at all . . . I was never raised with the idea that not going to college was even an option, let alone a good idea). There's a kind of inherent equality in such a society; even the little guy without great educational opportunities can live comfortably and securely in his place (I don't mean that as snobbily as it sounds. My future social standing is not in any way set in stone.).
On the other hand, I don't see any moral imperative to expend resources to preserve such industries that are not self-sustaining, and certainly not those that have wastefully burned through resources at the rate the American auto industry has. The basic arguments for free markets in most cases are convincing; if someone can manufacture cars more cheaply (Japanese firms), they should. If a for-profit enterprise is unprofitable, it should not exist (and it would be horribly inefficient to turn the auto industry into an insiders-only welfare program).
As for the autoworkers themselves, I have no problem with them being generously helped directly through programs to help them move, obtain training, keep health care benefits, and so forth. But if your specific employment does not add value at the margins, you should be fired and get different employment.
It really isn't very complicated.
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