Dean Baker on Autoworkers Pay… Plus Helping Banks
One flaw in this blog, if you ask me, is that we don’t link to Dean Baker enough. He generally covers a lot of material in a short amount of space, and is right more often than he’s wrong. So if y’all keep your mouths shut, I’m just gonna steal one of his posts, outright.
The Washington Post has repeatedly editorialized that auto workers at the Big Three companies should be forced to take pay cuts because they earn $57,000 a year, which is more than workers get at the foreign-owned plants in the United States. Consistent with this editorial position, the paper has an article today about efforts to lower the compensation packages of union workers.
The Post has virtually ignored the much larger gap between executive compensation at the Big Three and at the transplants. While top executives at Japanese manufacturers like Toyota only earn around $2 million a year, executives at the Big Three can earn 10 times this amount.This would seem to be a reasonable focus for those concerned about making the U.S. industry competitive.
And since I’m blatantly ripping him off in this post, I had been planning on taking this one earlier in the week:
NPR reported on Representative Barney Frank’s effort to ensure that a substantial portion of the money from the second $350 billion in the TARP go toward helping homeowners. The proposals that purport to save homeowners would in fact hand large amounts of money to banks. They involve paying banks far above market prices for underwater mortgages. The benefit to homeowners is that they would be allowed to stay in their homes, possibly with zero equity. (Some proposals also give the homeowner a small equity cushion.)
NPR and other news outlets should be reporting who gets the money under these proposals. In many cases, banks may be paid tens of thousands of dollars to leave a homeowner in a home in which they have no equity. At a time when Congress is debating extending the State Children’s Health Insurance Program at a cost of $3,000 per kid, it is not clear how many kids’ health care they or the public would be willing to sacrifice to pay a bank to leave someone in a home in which they have no equity.
Once again, mum’s the word. Nobody tell Dean about this.