Saturday, October 27, 2007

Chrysler workers approve new contract -- just

56% of production workers and 51% of skilled trades -- a bare majority -- signed on to a four year contract patterned after the one at GM a few weeks back. There too, it took likes the union's going to pick up a much greater share of health care costs.

Ford is next, and its problems are pretty bleak ... so much so that the company even pledged its famous Blue Oval as collateral some time ago, according to the NYT. Ford says it can afford to pay for the health care trust's upfront costs -- which the union would then take over and run as its own -- but it's already given up Land Rover and Jaguar, two of the industry's crown jewels, and I wouldn't be surprised if Volvo is next.

Job security, or health care. That's what's coming up in a lot of union negotiations the next two years for a lot of US industries and with an election season the issue's going to get red hot. Even well-established and respected non-union companies, like John Deere (so big that it has its own finance arm that deals with much more than agricultural implements and lawnmowers; and even its own HMO -- seriously) may have to make some tough choices to make its balance sheet work; and the health care crisis and the sub-prime mortgage crisis are becoming increasingly linked in ways one could not have imagined even six months ago.

If one sees blue chip companies like Merrill Lynch write off $8 billion in bad loans -- ML, for God's sake! -- then America really is in trouble. And as much as we gloat over the strong loonie, Euro and pound, we're going to get dragged down by the US' coattails and fast unless there's decisive leadership in the US for a change; both on the economy as well as foreign policy.

And health care, too. I doubt we'll see a single payer system any time soon in the States; but "pay or play" like they have in Hawaii and Massachusetts; and in Illinois for minors, seems a definite possibility now.

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