Union Workers Turn Against Organized Labor

As organized labor loses leverage in a race-to-the-bottom global market, some workers are becoming so disillusioned by what their unions can, or rather can’t, do for them that they want out. The disaffected include dozens of machinists at Caterpillar Inc.’s plant in Joliet who crossed the picket line during a strike last summer and are planning unfair labor practices complaints against the union.

Organized labor’s slippage is most acute in the manufacturing sector, which has lost 4.7 million jobs and seen membership shrink by almost a third since 2001, according to the Bureau of Labor Statistics. Overall, private-sector union membership stands at just 6.9 percent nationally and 10.6 percent in Illinois. …

Many rank-and-file employees have opposed unions all along, of course. Despite organizing drives, workers have turned down collective bargaining at automobile plants across the South. Legislatures in 23 states have enacted “right-to-work” laws that allow employees to opt out of dues-paying membership at union shops; Indiana joined this camp early this year.Now some workers in union-friendly states are turning on their brethren over strikes.

via Crain’s Chicago Business.

These are good jobs that pay well.  Most people really want to work.  Yet the unions get in they way somtimes… and yes, sometimes it’s the companies that get in the way.  The big difference however is that the company is the one taking the risk.  The shareholder or owner is placing his or her money on the line.  The union is not.

Successful risks should be rewarded.  Bad risks are punished.  That’s how people learn; how the cream rises to the top.

You can take all the money in this country and redistribute it equally to each person.  In ten or fifteen years those who are “rich” will be rich again.  Those who are “poor” today will be poor again.

It’s very much like the story of the talents; Matthew 25:14-30.

How Retirement Benefits May Sink Illinois

We’re national news again.

…  Indiana’s debt for unfunded retiree health-care benefits, for example, amounts to just $81 per person. Neighboring Illinois’s accumulated obligations for the same benefit average $3,399 per person.

Illinois is an object lesson in why firms are starting to pay more attention to the long-term fiscal prospects of communities. Early last year, the state imposed $7 billion in new taxes on residents and business, pledging to use the money to eliminate its deficit and pay down a backlog of unpaid bills (to Medicaid providers, state vendors and delayed tax refunds to businesses). But more than a year later, the state is in worse fiscal shape, with its total deficit expected to increase to $5 billion from $4.6 billion, according to an estimate by the Civic Federation of Chicago.

Rising pension costs will eat up much of the tax increase. Illinois borrowed money in the last two years to make contributions to its public pension funds. This year, under pressure to stop adding to its debt, the legislature must make its pension contributions out of tax money. That will cost $4.1 billion plus an additional $1.6 billion in interest payments on previous pension borrowings.

Business leaders are now speaking openly about Illinois’ fiscal failures. Jim Farrell, the former CEO of Illinois Toolworks who is heading a budget reform effort called Illinois Is Broke, said last year that the state is squandering its inherent advantages as a business location because “all the other good stuff doesn’t make up for the [fiscal] calamity that’s on the way.” Caterpillar, the giant Peoria-based maker of heavy construction machinery, made the same point more vividly when it declined in February to locate a new factory in Illinois, specifically citing concern about the state’s “business climate and overall fiscal health.”

via WSJ.

How bad is it going to be?

Back in Illinois, Dana Levenson, Chicago’s former chief financial officer, has projected that the average city homeowner paying $3,000 in annual property taxes could see his tax bill rise within five years as much as $1,400. The reason: A 2010 Illinois law requires municipalities to raise the funding levels in their pension systems using property tax revenues but no additional contributions from government employees. The legislation prompted former Chicago Mayor Richard Daley in December to warn residents that the increases might be so high, “you won’t be able to sell your house.”

We’re in trouble.

Local media is still ignoring.  National media starting to ring the bell.

Chicago Business Round-Up

Cruising the local business section I found the following:

Caterpillar Opening Facility in Mexico
Peoria-based Caterpillar said Friday it is building a parts distribution center in Mexico that will employ up to 150 people.  …

The 500,000-square-foot facility will be in San Luis Potosi, and it’s expected to be operational in mid-2013. The new plant will be under the company’s logistics unit, which has also opened distribution centers in California, Ohio, Washington, Texas and Dubai

via Chicago Tribune.

Strike One!

Business in the Midwest Slips
Business activity in the Midwest decreased slightly in March due to a decline in new orders and employment, according to a monthly survey of members of the Institute for Supply Management-Chicago.

The Chicago Business Barometer fell to 62.2 in March from 64 in February. A reading above 50 indicates expansion in the regional economy.  …

Businesses said they are being affected by high oil prices, which are increasing transportation costs and raising the price of commodities

via Chicago Tribune.

Strike Two!

R.R. Donnelley Closing Mendota Plant
R.R. Donnelley & Sons Co.will close its Mendota printing plant at the end of May in a move that will affect 207 employees.

The pending closure will be devastating for the city, Mayor David Boelk said Thursday. Boelk said the company’s announcement caught him off guard, adding that he learned about the closing on Wednesday when an employee called him in tears.  …

R.R. Donnelley is one of the largest employers in the city of 7,340 residents. As such, the closing will affect other businesses, including the local post office, which Boelk said was spared in the latest round of Postal Service closings because of the volume of mail generated by the plant. Boelk said he hopes to find a buyer for the plant that could rehire the workers.  …

R.R. Donnelley has sought to adapt itself to an increasingly digital world in the last eight years. As part of that reorganization, it laid off 2,899 workers in 2011.

via Chicago Tribune.

Strike Three!!