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Washington, Dec 9, 2005 -

Congressman Dennis J. Kucinich (D-OH) today joined with House Democrats for a national online e-hearing today to give workers at General Motors and Delphi the opportunity to communicate directly with Congress about their concerns on issues like jobs, wages, health insurance, and retirement security. 

The online e-hearing can be found on the internet at: http://edworkforce.house.gov/democrats/autocrisis.html

Kucinich posted the following statement today on the site:

“Much of the talk surrounding the current crisis facing US automakers revolves around the toll legacy costs place on companies such as Ford and GM.  These costs, the pensions of workers and healthcare benefits, are rightfully focused on in that their value to workers cannot be understated.  A loss of these benefits would be a devastating blow for workers and their families.  As we begin to look at solutions for the auto industry and their suppliers, it is imperative that we place a priority on truthfully evaluating the current situation and ensuring that workers are protected.

“In evaluating legacy costs we must recognize some important truths: pensions do not belong to companies, they belong to workers.  Dumping worker benefits on the PBGC should not be the solution to automakers’ current woes.  The PBGC’s determined levels of yearly benefits do not provide adequate retirement security for workers.  Dumping pension plans on the PBGC breaks a promise to workers, the promise that their retirement is secure.

“Workers have earned the pensions they are owed.  Companies cannot be allowed to hand off their worker’s pension plans and place their workers in harms way.  We must be clear that workers’ retirement security is not a bargaining chip.

“There is no doubt that the legacy costs of companies such as GM and Ford have grown over the many years they have been in business.  But there are other issues that need attention.  The first is US trade policy.  The US has a massive current account deficit with the world, over $580 billion, a significant part of that with China.  At over $167 billion in 2004, the deficit with China has doubled in size since 2001.  US auto companies and autoparts makers have invested in factories in China.  Chinese manufacturing workers receive about 1/10th or less the wages of American workers.  In addition, the Chinese currency continues to be manipulated by the government to be undervalued as measured against the US dollar.  That also makes Chinese products cheaper than comparable American products.  Together with the lower wages, the manipulated Chinese currency induces US producers to invest in China for export to the US.  I am cosponsor of a bill, HR 1498, that would put a tariff on Chinese exports if the government there continues to subsidize low prices through currency manipulation. 

But even if the Chinese stopped manipulating their currency, and it was allowed to float against the US dollar, unless the value of the US dollar fell from its artificially high levels, US-based manufacturers would not gain much advantage.  Overlooked in many discussions of trade is the overvalued dollar, which makes the imported goods consumers buy cheap, but makes our exports too expensive for foreigners to buy.  We need a dollar that allows our products to be competitively priced.  The value of the US dollar should be adjusted to improve our competitiveness.

Finally, we must ensure that decisions being made are based on fact and not fiction.  There is a myth put forward by the CEO of Delphi about the overpaid autoworker.  He’s claiming at $65 per hour is a typical wage Delphi pays for blue collar labor.  Problem is that Delphi doesn’t pay $65 per hour.  Rather, this figure is the creation of Delphi’s media consultants and it lumps together all of Delphi’s labor costs and payments to unemployed and retired workers, but falsely allocates them only to Delphi’s much smaller workforce.  That inflates the average labor cost.  Actual average wage for current Delphi workers is around $23 per hour.  So whatever Delphi’s financial problems, one thing that is NOT a cause is workers earning $65 per hour, and it is misleading of Delphi’s CEO to say otherwise.  

I thank my colleague, Congressman Miller for initiating this E-hearing on this timely and important topic.  We have a responsibility to engage the nation in discussion of this topic and work together to find a resolution for this crisis.  I look forward to reading the testimony of company and union officials, experts in the auto industry, and particularly workers and retirees on this problem. 

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