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Corruption in the bargaining process

If you haven't been following this tale of corruption, this article, "FCA spent $15K on steak dinners for UAW", in The Detroit News, lays out the main point. Just like salespeople woo their customers, Chrysler executives wooed UAW leaders with meals and gifts before a contract negotiation. It would be like the Ohio State football coaches buying meals and gifts for the Michigan players before the game. It doesn't smell right.

Some folks are going to prison because the law makes it a crime in the union context.

The UAW historically has not been a corrupt organization. If anything, the union took a PR hit during the recession for having been perceived as driving too tough a bargain with GM, contributing to the bankruptcy. I never thought that was fair because the union leaders were doing what they had been elected to do: drive the best bargain they could for the workers. GMs executives didn't do what they were hired to do: plan prudently. Ford's management did, and they stayed solvent during the recession.

Periodically many commentators call for more cooperation between labor and management. But cooperation can come at one party's expense. "Why can't we all just get along?" It's fine until you realize how much you have to pay to get along.

In Germany, union leaders sit on the Boards and help run the companies for the benefit of workers as well as shareholders. That is a slightly different model of capitalism from ours and would mark a change from our historic corporate culture of conflict between labor and management. It may be worth a shot and seems appealing on some levels, but it would require a significant change in our labor laws.

For now, union leaders and company leaders must remember, they can be friendly- but not too friendly. 

Read the full article, "FCA spent $15K on steak dinners for UAW"

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