Big 3, UAW tackle health care

[Omaha Steve]

Source: USA Today

By Sharon Silke Carty, USA TODAY
DETROIT — The United Auto Workers could end up taking responsibility for billions of dollars of retiree health care costs if Detroit's Big Three automakers can make the costly and complex transfer enticing for the union in this summer's contract talks.

A deal might mirror Goodyear Tire and Rubber's (GT) recent union contract, under which Goodyear agreed to invest $1 billion into a fund controlled by the United Steelworkers to cover current and future retirees' health care expenses. Goodyear pushes a $1.2 billion liability off its balance sheet while the steelworkers' union gains an asset that protects retired workers' benefits and can't be touched by creditors should Goodyear ever file for bankruptcy.


Goodyear
Goodyear tires at a plant in Ontario, Canada. The steelworkers' union agreed to take on retirees' health care expenses, taking a $1.2 billion liability off Goodyear's balance sheet.


Facing even larger liabilities for their retirees' health care, the automakers have expressed interest in exploring a similar arrangement with the UAW, but the complexity of setting it up could be a major stumbling block. How much would each automaker contribute to the fund? Who would be in control of the plan? And how much, exactly, will health care cost in the future?

Those questions weren't easy for Goodyear to hash out, either. USW union members were on strike for 86 days last fall after talks broke down over the fund issue. Goodyear wanted to contribute $550 million, less than half of its projected retiree health care costs, according to USW spokesman Wayne Ranick.


Read more: http://www.usatoday.com/money/autos/2007-07-09-goodyear-uaw-healthcare_N.htm?csp=34

[no_hypocrisy]

1. Well maybe, if maybe the Big Three Automakers supported

universal health care, the issue of the cost of health care wouldn't be a problem for them. They'd actually be saving money and have more productivity.