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Lawmakers: Auto Industry Needs To Work With Labor On Legacy Costs
By Ken Thomas, Associated Press
October 25, 2005
The U.S. auto industry needs to work with labor unions to address some of the problems it faces with health care and benefits for retirees, but some steps could be taken to help the manufacturers, lawmakers said
Tuesday.
"Labor and management have to understand that legacy costs and the rest of it are significant and the only way that they can be successful is to understand that they have a symbiotic relationship with each other," said Sen. George Voinovich, R-Ohio. "The more they cooperate and work together, they better off they are going to be in terms of their
future."
General Motors Corp. expressed hope last week that lawmakers would provide more leadership in helping them tackle mounting health care costs. GM and the United Auto Workers reached a tentative deal to have the No. 1 automaker's retirees represented by the union pay part of their health care premiums for the first
time.
Michigan Gov. Jennifer Granholm urged the state's delegation to work to help the automakers, calling for the federal government to create a catastrophic insurance pool to lessen the burden of health care costs, shore up corporate pensions and help manufacturers facing sharp competition by enforcing trade
laws.
Sen. Mike DeWine, R-Ohio, said there is an understanding of the competitive problems faced by manufacturing, but he did not expect specific legislation to emerge in the near future. But, he noted, "when you look at the long-term issue of competitiveness, that certainly is something that I think people are beginning to
understand.
"Sen. Carl Levin, D-Mich., said the Bush administration would be key in determining ways to help the industry."The administration needs to respond to the crisis of manufacturing in this country, particularly in the auto sector," Levin said.Sen. Debbie Stabenow, D-Mich., said she was particularly concerned that proposed cuts to federal programs such as Medicaid and Medicare, which provides health care for the poor and elderly. She said the changes could have a "backdoor way of putting more pressure on
business."
"When you cut Medicaid and Medicare, then more people walk in the emergency room sicker than they should be, hospitals treat them and then they increase the cost of people's insurance," Stabenow said. "It's exactly the opposite of what should be done right now in terms of manufacturers."
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