Obama Auto Plan Gives Auto Workers Hope
The new plan for GM and Chrysler unveiled yesterday by the administration has caused quite a stir, especially among the bondholders and the UAW. The reason: President Obama, in his presser regarding the plan, mentioned the bugaboo word “bankruptcy.” As in, if this plan doesn’t work a “quick and surgical” use of Chapter 11 might offer the “best chance at success.” This unveiling ceremony carried its own not-too-veiled threat: bankruptcy would endanger bondholder and union interests, so the choice for them is stark: negotiate your demands downward from your already lowered expectations or risk losing much much more.
The plan, however, does offer something for the unions and the “auto communities” where they live. It promises to:
• Maximize the effectiveness of Recovery Act funds for new and more diverse economic development for new jobs, business and industry through various means including local infrastructure, housing, education and new industry.
• Deploy rapid response unit to communities facing plant closings to both meet immediate needs and to develop strategies for new job growth.
• Extend Trade-Adjustment-Assistance (TAA) to the auto industry, including retraining, healthcare extensions, income support and wage insurance.
• Attract major defense, research, green industry and other project to the region. Channel Workforce Investment Act (WIA) and other emergency grant funds to the region.
• Work with stakeholders to develop new legislative efforts to direct emergency support to affected communities and regions, and bring new jobs and economic opportunities to these areas.
As his Director of Recovery for Auto Communities and Workers, President Obama picked an able individual, Dr. Edward Montgomery, Dean of the College of Behavioral and Social Sciences at the University of Maryland, until today’s resignation. Dr. Montgomery received a 1982 doctorate in economics from Harvard University, and in 1997 joined the the Clinton administration Labor Department as chief economist. He rose quickly to Deputy Secretary of Labor where he directed more than 17,000 employees and had a direct role in ending the 1997 Teamsters strike against UPS.
President Obama has picked a strong advocate for auto workers and communities, and indicated that Montgomery would tap the $787 billion economic stimulus package “to create new manufacturing jobs and new businesses where they’re needed most – in [auto] communities. And he will also lead an effort to identify new initiatives we may need to help support your communities going forward.”
So, whether GM and Chrysler survive or not, the President clearly has their workers’ interests front and center. Dr. Montgomery will be involved in all facets of the plan and he’s a proven leader with, colleagues say, an ability to build consensus. Robert Schwab, associate dean of the College of Behavioral and Social Sciences says, “He’s a real problem solver, terrific at bringing people together who are at loggerheads, and working to get a solution.”
Aside from his business and labor He’s what’s needed to provide some assurance and comfort to the auto workers’ families who have already suffered and who may face more in the future. One thing is certain to me, President Obama demonstrates not merely intelligence and courage, he’s also revived something that’s been missing for many years at the White House, compassion for working families married to hardheaded pragmatism.
