Hourly workers at General Motors will soon be getting profit-sharing checks of up to $7,000 each after the automaker reported record earnings this week. President Obama may also get a political dividend, two-and-a-half years after a government-engineered turnaround.
Obama reminded a group of United Auto Worker members this week, that back in 2009, his rescue of GM and Chrysler had plenty of critics.
Opponents of the auto rescue included Republican White House hopefuls Rick Santorum and Mitt Romney, who were both campaigning in Michigan this week. Santorum told the Detroit Economic Club the right way to deal with the automakers’ problems in 2009 was to let the free market work.
“Would the auto industry look different than it does today? Yes it would be,” Santorum said. “Would it still be alive and well? I think it would be alive and equally as well, if not better.”
Santorum is running on a pro-manufacturing platform, stressing his roots in blue collar Pennsylvania as well as a tax plan that would make factories tax free. While other candidates talk about training programs for would-be factory workers, Santorum complains that government handouts are discouraging industrial work.
“When you have 99 weeks of unemployment benefits and you have a variety of other social safety net programs, people can make choices that they otherwise wouldn’t make if the economy was not one that government dependency was the watchword,” he said.
Romney, whose father once ran an auto company, says he’s glad that GM and Chrysler have rebounded. But he continues to criticize President Obama’s handling of the auto rescue. Romney calls it an example of “crony capitalism,” because the autoworkers’ union that supported Obama emerged with a stake in the companies.
“When a president of the United States begins taking your money to give to his donors, that’s a problem,” Romney said.
While Romney regularly criticizes those he calls “union stooges,” Obama stressed cooperation between labor and management when he visited a unionized Master Lock plant in Milwaukee this week. That cooperation has allowed CEO John Heppner to bring about 100 jobs back to the U.S. from China over the last year and a half.
“We figured out how to make this facility productive. It’s about trust,” Heppner said. “We care more about mutual success than our own.”
Nationwide, factories have added more than 400,000 jobs over the last two years, and Obama wants to encourage more hiring. But part of the success of these factories is their ability to do more with fewer workers.
Veteran tool-and-die maker Don Olson says the Master Lock plant employs only about a third as many people as when he started 25 years ago. Back then, much of the work was done by hand.
“It looked like something out of the ’40s, but they really automated since then,” Olson said. “That’s the only way we’re bringing these jobs back.”
We’re well paid and we have a good benefit package, and in order to maintain that, you’ve got to make a lot of locks per person.”
Master Lock makes more padlocks than anyone else in the world.
CEO John Heppner joked about all the locks that weren’t being made at Master Lock during the hours of preparation for the president’s visit. But soon after the president left, the Master Lock employees were back at those automated machines making more locks – faster than ever.