American unions are a cancer

[rukawa]

This exemplifies how horrible American unions are:

https://driving.ca/general-motors/auto-news/gm-plant/striking-union-demands-gm-import-no-cars-to-u-s-even-from-canada

 

Note that the UAW is demanding GM halt production of autonomous and electric vehicles. And they are unable to compete with Canadians?! Do American workers have any sense of pride? You need protection from Canadians!! In every area where American unions operate they make attempts to reduce productivity, kill innovation and stifle progress. Also note how Trump's trade policies are killing American jobs:

 

https://www.vox.com/2019/9/17/20868936/gm-workers-strike-uaw-trump

 

All the populist pandering to the poor white and black losers in the US isn't working. Its not making America Great Again, its making it poor again.

[Gregmal]

Yup. Barra was caught with her pants down and now has the unenviable task of playing Brook Nevils. Willfully getting railed by the Union while at the same time telling shareholders she s having none of it and fighting the good fight. No win situation.

 

GM would be wise to do the unthinkable. Put many of the existing operations into runoff. Sell popular brands. Focus on Cruise and monetizing IP to capitalize the current head start they have on future auto trends. But this will never happen because this is the epitome of a never learn business and the entire chain from top to bottom is clogged up with people like Barra, career employees who have nothing to gain from changing the ways of the past.

[stahleyp]

Boards that gleefully overpay executives for poor or mediocre performance are also a cancer.

[Read the Footnotes]

Quick smash some looms and bring on the tariffs.

Nothing new here?

We should have learned these lessons hundreds of years ago.

[rukawa]

Boards that gleefully overpay executives for poor or mediocre performance are also a cancer.

 

Overpaying is one issue but it isn't the biggest one. The mediocre performance is the bigger problem. On overpaid CEO costs his company millions but his mediocre performance cost his company billions. There is a fundamental problem here and its at the heart of the capitalistic system. I'm not really sure how to fix it. The problem is that you need limited liability joint stock corporations to raise large amount of capital to fund big operations. But by their very nature these corporations disperse ownership to millions of passive shareholders who don't understand or care enough about the corporations they have invested in. In addition the shareholders are too numerous to be united. This results in a principal agent problem where management is busy protecting their fiefdoms and feathering their own nest at the expense of the corporation as a whole and its mission. The people running the corp don't have their interests aligned with owners or even customers.

 

The same problems exist in politics. Voters here play the role of shareholders and politicians play the role of management. And a similar problem is playing out in science.

 

Fundamentally the issue is that the people running the system don't have interests that align with the thing the system is supposed to accomplish.

[Viking]

Boards that gleefully overpay executives for poor or mediocre performance are also a cancer.

 

Overpaying is one issue but it isn't the biggest one. The mediocre performance is the bigger problem. On overpaid CEO costs his company millions but his mediocre performance cost his company billions. There is a fundamental problem here and its at the heart of the capitalistic system. I'm not really sure how to fix it. The problem is that you need limited liability joint stock corporations to raise large amount of capital to fund big operations. But by their very nature these corporations disperse ownership to millions of passive shareholders who don't understand or care enough about the corporations they have invested in. In addition the shareholders are too numerous to be united. This results in a principal agent problem where management is busy protecting their fiefdoms and feathering their own nest at the expense of the corporation as a whole and its mission. The people running the corp don't have their interests aligned with owners or even customers.

 

The same problems exist in politics. Voters here play the role of shareholders and politicians play the role of management. And a similar problem is playing out in science.

 

Fundamentally the issue is that the people running the system don't have interests that align with the thing the system is supposed to accomplish.

 

Yes, the current capitalist system in place in the US has its flaws. It is still infintely better than the options in place around the world. China’s model? No thanks. The Rissian model? No thanks. The Middle East models? No thanks. The South American models? No thanks. The African models? No thanks. The south east asian models? No thanks.

 

I had a conversation with my daughter who is in grade 11. They are doing a unit on Capitalism and of course she is being taught how evil it is (i live in Canada). There is no mention of the other economic models currently in place all other parts of the world (China, Russia, Middle East etc). And of course any discussion of the economic model should also include a discussion of the political system because the two fit together like hand in glove. For example, China has no freedom of speech/information or rule of law. I know most women in the US would love to move to Saudi Arabia and live under their political system. Buffett is correct. If you live in the West you really have won the birth lottery. Is it perfect for everyone? Of course not. Is it miles better than the next best economic model? Yes (from my perspective anyways).

[Read the Footnotes]

Yes, the current capitalist system . . . It is still infinitely better than the options in place around the world . . . (i live in Canada).

 

First they wanted to export their cars to the US. Now they want to export their capitalist ideas to the US.

 

I believe we need to ban the importation of all Canadian capitalist ideas.

 

If we don't stop this now, eventually American children will be exposed to the blasphemy of free markets.

 

In the event we cannot ban all importation of Canadian capitalist ideas we should at least offer trigger warnings before anyone speaks of capitalism or even worse, free markets, and we should impose the highest tariffs possible on the importation of Canadian ideas.

[SharperDingaan]

The unions are just doing their job; getting as much as possible for their members, for as long as possible.

Good on them, and power to them.

 

Nothing can change, if we all keep playing the same way. So don't.

Build brand new, build all-american, build in detroit, build electric only, and build in scale - no hybrids.

Prove the concept, keep selling equity to fund the cash burn, & just buy market share and economies of scale.

 

The reality is that you will bought out, & eliminated.

Fewer & higher paid workers = less union membership (dues+votes) = threat, and political interference

More electric = more green = sustainable (but fewer) jobs, and political interference

More electric = new/updated infrastructure = new investment story, and Wall Street interference

More electric = less gasoline = threat, and big oil interference

The 'buyout' solves a lot of political 'problems', creates a lot of new 'opportunity', you will even be respected for the 'hold-up' (market auction), and there's an awful lot of money in the pig trough. The result being the very good chance of eventually becoming the recipient of a very generous offer, that you cannot refuse.

 

Change the game.

 

SD

 

[Read the Footnotes]

Though I wrote a couple of lighthearted or joking posts above, I think this is an interesting thread and rukawa started us off with an excellent post.

 

The thread highlights that some of the Trump platform's ideas are ideas that for decades belonged to the left and to the Democrats. When the Democrats abandoned those ideas in order to build a new focus that places identity above all else, Trump wisely picked up those some of those discarded ideas and took the voters that came along with them. The result is a weird non-sensical amalgam of logically inconsistent policies, that worked beautifully to create a coalition large enough to elect him.

 

The protectionism that Trump preaches would logically go very well with protecting the socialist worker, or protecting someone from offensive language or protecting someone from high rents with rent control. It's funny that Trump supporters are so angry and hateful toward the left when some of their ideas are from the left and quite recently.

 

Immigration is another example of a policy that was the left's very recently. Only a few years ago it was the left that was against illegal immigration and it was the right that wanted to look the other way in order to provide below market labor to republican donors.

 

So on both immigration and trade protectionism, Trump is a (historical/traditional) lefty. Why so much hate for the left and their other forms of protectionism?

[Castanza]

Yes, the current capitalist system . . . It is still infinitely better than the options in place around the world . . . (i live in Canada).

 

First they wanted to export their cars to the US. Now they want to export their capitalist ideas to the US.

 

I believe we need to ban the importation of all Canadian capitalist ideas.

 

If we don't stop this now, eventually American children will be exposed to the blasphemy of free markets.

 

In the event we cannot ban all importation of Canadian capitalist ideas we should at least offer trigger warnings before anyone speaks of capitalism or even worse, free markets, and we should impose the highest tariffs possible on the importation of Canadian ideas.

 

Canadian Free Market ideas? You mean like the dairy industry up there?

[stahleyp]

Boards that gleefully overpay executives for poor or mediocre performance are also a cancer.

 

Overpaying is one issue but it isn't the biggest one. The mediocre performance is the bigger problem. On overpaid CEO costs his company millions but his mediocre performance cost his company billions. There is a fundamental problem here and its at the heart of the capitalistic system. I'm not really sure how to fix it. The problem is that you need limited liability joint stock corporations to raise large amount of capital to fund big operations. But by their very nature these corporations disperse ownership to millions of passive shareholders who don't understand or care enough about the corporations they have invested in. In addition the shareholders are too numerous to be united. This results in a principal agent problem where management is busy protecting their fiefdoms and feathering their own nest at the expense of the corporation as a whole and its mission. The people running the corp don't have their interests aligned with owners or even customers.

 

The same problems exist in politics. Voters here play the role of shareholders and politicians play the role of management. And a similar problem is playing out in science.

 

Fundamentally the issue is that the people running the system don't have interests that align with the thing the system is supposed to accomplish.

 

I'm not sure if this would work but I think we should legally tie executive compensation to the median employee. We could also mandate a large portion of the executive compensation be tied to company stock they can't sell for 10 years. It would be harder for boards to overpay and unions wouldn't be as mad because the executives wouldn't be fleecing the company while employees are being laid off (at least not to the same degree).