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Source link: http://archive.mises.org/6036/buy-goodyear-or-maybe-not/

Buy Goodyear! (or maybe not)

December 18, 2006 by

I know nothing about the tire market but it seems clear that the unions have set out to destroy another company. I’m in the market now for tires, and I would like to buy Goodyear if only to support “capital” over “labor” (how absurd to think that their interests are naturally opposed!). But the car parts guy tells me that I can get a better Michelin tire for $50 less. Maybe he is not telling the truth but if it is true, it gives a hint as to what needs to happen at that company. The union needs to be fired and replaced with a 100% “scab” workforce.

{ 25 comments }

Wild Pegasus December 18, 2006 at 10:40 am

They’re trying to destroy Goodyear because they’re striking? No wonder we’re called dope-smoking Republicans.

- Josh

Mark Brabson December 18, 2006 at 11:01 am

The only way to ultimately solve these problems is the total repeal of the National Labor Relations Act and its subsidiary acts and also the real of Davis-Bacon Act. A company should not be required to recognize or deal with a union. If they do decide to deal with the union, it should be done voluntarily and not under any government compulsion whatsoever. As for the workers themselves, they should be totally free to join or not join the union and if not in the union, they should be free to negotiate directly with the company if they wish.

Unions are not inherently bad. In fact, labor associations would be a natural part of the capitalist system. It is government interference that turns unions into thuggish parasites, rather than benign organizations.

David Stallings December 18, 2006 at 11:58 am

If you are anti-union then are you pro-management or pro-stockholder? The two are rarely the same. What is the point of being non-union if management allocates the money to secure thier positions and earnings. One group (management) of workers rips off the owners versus the other.

Mexico, VENEZUELA,Argentina, Chile, and Boliva are recent examples of management keeping workers in thier place. The workers rebelled and now all the above countries are socialist.

The right to private property is not from God. If a majority of persons do not benefit from a society with private property, then the right to private property will be eliminated.

Lie, cheat, steal, use, abuse, and manipulate. It is the human way of life. Any other type of behavior exists pretty much only in books and dreams.

David Stallings December 18, 2006 at 11:58 am

If you are anti-union then are you pro-management or pro-stockholder? The two are rarely the same. What is the point of being non-union if management allocates the money to secure thier positions and earnings. One group (management) of workers rips off the owners versus the other.

Mexico, VENEZUELA,Argentina, Chile, and Boliva are recent examples of management keeping workers in thier place. The workers rebelled and now all the above countries are socialist.

The right to private property is not from God. If a majority of persons do not benefit from a society with private property, then the right to private property will be eliminated.

Lie, cheat, steal, use, abuse, and manipulate. It is the human way of life. Any other type of behavior exists pretty much only in books and dreams.

Sione Vatu December 18, 2006 at 12:40 pm

First point. Buy the Michelins (check they are the ones manufactured in France though- the others are not as good). Michelin produces the best tyres today. Should you want good roadholding combined with good ride qualities Michelin is the tyre to have. Vehicle development engineers confirm the quality and excellent attributes of this brand. I have seen several back to back tests and much literature disclosing the superior nature of Michelin product (made in France). I also have direct experience in this regard. Forget the rest, Michelin is the best.

Second point. The management of Goodyear need to have the ability to employ whomever they see fit. If it is non-union workers they want, then it is non-union workers they should employ. If they prefer to deal with a single negotiator representing the interests of the entire workforce, then they should determine whether that entity is a union or some other outfit and deal with it.

Last points. The shareholders should be able to remove & replace management should they determine it is right and proper to so do. Similarly, should other investors feel they can utilise the company resources better than the present mob they should be able to raise the cash, raid the company, purchase the shares and take it over (hostile or not). Junk bonds and LBOs are fair and fine. Turning the company around to produce improved product at keen prices is ideal. Selling off assets and even liquidating the company is fine as well. That’s business.

Sione

Artisan December 18, 2006 at 12:43 pm

The reason why Michelin is cheaper (I can’t really believe that though!) , is perhaps because they just passed a deal with the German ministry of transport: Germans drivers are now required by law to change their tires according to the season: winter / summer (even though insurances will be required to pay anyways whatever tire you use)

Jeff December 18, 2006 at 12:44 pm

It is sad to hear An American trash another American. I am a Goodyear worker on strike and it is easy to see you make comments on a subject you know nothing about. Please look up the history and see that the Union are AMERICAN workers. Not some COMMUNIST that these companys want working for them.
Goodyear was in trouble 3 years ago and as a UNION we took pay and benefit cuts to help them. now they want to sweep our Retirees under the rug. Why should my Father who worked his whole life to make a company successful struggle to buy food while Jon Rich and Bob Keegan watch their personal bank accounts collect multi-millions of dollars yearly. They have been with Goodyear only a few years. Unions are Americans!
We don’t destroy companys. Only those who support those Companys by buying the products made in Communist contries.
So go ahead and buy Goodyear tires now. We are only Americans with American families like yours. Why would I expect you to support us.Especially after you have made a judgement on me without even looking at the facts.

Roy W. Wright December 18, 2006 at 1:40 pm

Jeff,

If you want respect in intelligent company, you might do well to cut the nationalist rhetoric.

jeffrey December 18, 2006 at 2:05 pm

Just so that we are clear, the Jeff that Roy refers to is the Jeff in the post just above and not the original poster (that would be me). Maybe that is obvious.

adi December 18, 2006 at 3:22 pm

Does anyone think that also workers of some company can be victims of govt’s policies even if it seems that the unionized workers are getting extra only because of different regulations or legal bullying of labour unions?

Workers can be victims because of following reasons: 1) They “learn” economic propaganda from union representatives and govt economists. Austrianism is nowadays only minor school of economics when it’s true message is most urgently needed. 2) Tax code might make workers dependent on single company for their medical care and pension programs. This is because companies can have several tax advantages over private citizen who is purchasing medical care or saving for himself. 3) Regulations concerning occupations close many profitable doors for those who would be eager to work.

Too much trust for the collectivist solutions can often said to be mans own fault but I think that sometimes it’s not good to put all the blame on just a single group (in this case ordinary rank and file of unions). It doesnt sound good, when one has worked hard for many years and he is close to retirement, that there cames some who says that “Sorry, you dont have pension moneys anymore. We sort of raided these funds few years ago”.

It’s the consumer who decides which company will survive. Companies must make good products which have demand if they are to survive in competition. Customers can have preferences towards origin of particular product but it’s different thing to use govt’s force to limit choices available to consumers.

Austrian economics is not “economics of leisure class” like Bukharin used to say, it’s viable alternative to todays mainstream economics.

Sione Vatu December 18, 2006 at 3:52 pm

Jeff (from Goodyear)

I could not give a tinker’s cuss that you happen to call yourself an American. So what?

You have no right to demand special privledges from any consumer. If the product from the company you work for is inferior and more expensive than the competition, then you had better wake up to yourself and stop demanding the consumer support you in the manner to which you have become accustomed. They have no obligation to buy from your employer (in this case Goodyear). They have no obligation to support you. You have no right to make demand on them. Get over it.

The fact remains that the product you are making is inferior and more expensive to that being made by the competition. Either you are doing something wrong (in your day to day activities- after all you are contributing to the manufacturing of the product in some way) or you are working for the wrong company (which for structural or political or economic reasons is failing). You can only control what you do, so unless you are in the position to turn the company around, you should up stumps, resign and find something better to do with yourself. No need to shackle yourself to a losing proposition. The union won’t protect you from failure.

While there may be communists working at Michelin France and there are certainly communists working within the French government, I note it is you who is acting like a communist in your demands directed at contributors to this blog and tyre consumers in general. You have a lot of thinking to do mate.

Sione

Sione Vatu December 18, 2006 at 4:03 pm

Artisan

While not supporting a regulation such as the one you report, I am a fan of soft compound, relatively short life tyres. Around 10,000 kms tyre life is all that is necessary. By using a softer compound you get far superior grip on the road for better roadholding and safety. The differences between that and the usual levels of grip are enormous. Try it sometime.

I guess the TUV in Germany must be thinking along similar lines. They would appear to be encouraging the use of short-life sticky tyres. Also note that it is possible to travel at elevated velocity on German roads for extended periods of time. More than 180 mph is not all that exceptional. I’d not want to be in a car with three year old tyres doing that speed (or even a mere 120 mph). Nor would I want to be anywhere near such a vehicle (like in the next lane). While the regulation appears desirable from a tyre performance point of view, it’s bad news that some govt outfit should once again be interfering with private transport. Not on.

Sione

bill ott December 18, 2006 at 6:51 pm

Lets keep score: 2 safety, 3 field goal, 7 touchdown:

1. Who is getting screwed:
Union Workers, UWs.
Non-union workers, NU LIKE ME sometimes get screwed too
PUSH. But the extra work to screw individuals is less under a union contract. UW-Safety
UW: 2 NW: 0

2. Who represented workers to get the UNFUNDED pension system?
The union. Pension if compay healthy big but company not healthy little. Obviously Goodyear not healthy.
Non-Union-401K. Company goes belly up Non union keeps the dough.
Field Goal Non-Union
UW: 2 NW: 3

3. Who manages the pension system:
Union-Corrupt company or corrupt union and they get kickbacks from the pension manager or do it theselves. Any they own the dough.
Non-U-Indepenent company with much more limited ability to get the dough.
Field Goal Non-Union-Touchdown in my experience.
UW: 2 NW:6

4. Who negotiated the health care arrangement for the workers?
The union. Company healthy union big company not health union screwed.
Non-Union. Most have some sort of health benefits. Normally end at retirement.
Union: Touchdown but those benefits come out of salary some of which must got to the Non-Union.
Union: Field Goal, hell well give em a TD:
UW:9 NW:6

5. Who has SOLE representation of the workers for a not so modest fee:
UW: The union.
NU: Nobody
Depending on the Union dues and over a life time at say 33000 per worker per year/1800 hours per year x 12 months x 2 hours per month = $440 per worker per year. Or $13200 for a career.
NU: Touchdown but well give em a field goal.
Union: 9 NU: 9

6. Who gives your money to political campaigns?
UW: The Union.
NW: Nobody
Safety NW
UW: 9 NW:11

7. Who gets bonuses based on performance and has higher salary stunted to better performing workers?
UW: Sure.
NW: Common. But NW could be fired for bad performance as well.
NW: Field Goal-In my experience this is a big touchdown.

Final score: UW: 9 NW: 14
Could of easily been: UW: 9 and NW:22

I think the WORKERS in the union should find another representative LIKE THEMSELVES!!

And then they would not negotiate such foolish things and then take the money that goes to the Union and use it for themselves.

You wonder why union membership is declining in the private sector.

nunyabidness December 18, 2006 at 8:45 pm

Sione,

My but aren’t you a snotty, petty, smarmy little [EDITED] …? You have an awful lot of arrogance to come here and insult Americans. You sure do have a lot to learn about talking to people, mate. But then again, maybe being a [EDITED] is a positive for you. And one last point – who gives [EDITED] what kind of tire you prefer – nobody yanked your chain about it.

banker December 19, 2006 at 4:31 am

Is nunyabidness the type of person of whom communist death squads comprise of? It seems only raw, unhinged emotion is guiding his post. And since when is being an American citizen mean anything more than being an American citizen? Patriotism is one thing (like cheering for your home team), but it seems nationalism has taken over.

Artisan December 19, 2006 at 7:49 am

I know Sione, the science behind it is not disputable. Seasonal tire change is the best practice. Yet even on the Autobahn, not everybody drives 180 mph in a BMW… there are some simple folks left, who just drive a few miles to go to work in their old little car also… and I don’t think they will tell the difference (except in the wallet).

Of course, I don’t see why Goodyear would be disadvantaged through that German ruling (but rather Michelin since they are more focused on truck tire I believe).

It’s just crazy that German car insurances aren’t allowed to differentiate the tire risk and yet cops are told to fine you if you drive the wrong rubber… Strong State.

DavidB December 19, 2006 at 12:46 pm

It is not above managements to strike deal with unions that they know will eventually bankrupt the company. The reason they do this(and for some it may even only be a subconscious act) is because most CEOs will only be around for a few years so they only need to keep the peace long enough for their options to vest. Meanwhile, the company slowly bleeds and loses the ability to compete while the management does nothing.

Is it the fault of the unions for asking so much? Yes, to a degree but their leaders are paid to get the best deal possible. One thing the unions don’t do is run the finances of the companies so ultimately the responsibilities for making bad deals has to fall on management. That is their JOB. It is not only their job to run the company with the future in mind but it is also their job to explain to the workers why deal X will eventually bankrupt the company. They have complete access and control of the books. Most time, even with public companies, workers have very little access to the company books and thus can not make a proper financial determination

Vince Daliessio December 19, 2006 at 1:38 pm

In this case (and many others here in the US, both unions and management have appealed time and time again to get the rules of the game changed to further their own selfish interests. Soon after the passage of the National Labor Relations Act, unions and large firms began to conspire together to drive smaller (non-union) firms out of business. This is just another species of regulatory capture.

I read somewhere that the United Mine Workers lent large mining concerns huge sums of money to automate the mines. In other words, to screw non-union mining companies and workers, the UMW screwed its own employees, many of whom became redundant after longwall automatic mining machines arrived on the scene. Unions, absent any threat of replacement, become corrupt in the end, and, in the end, become the servants of corrupt management. The union worker, the non-union worker, and the nonunion company are all screwed at gunpoint. Only the union company and the union officers benefit, in the long run.

In short, a pox on both of their houses. Both Goodyear and its union deserve to go out of business. Good riddance.

Mark Brabson December 19, 2006 at 1:59 pm

It’s not the union or the company that is the ultimate problem. It is, as it always is, the government. The Labor Management Relations Act and Davis-Bacon Act.

The solution, in three easy steps:

1. Repeal LMR Act and all its successor acts.
2. Repeal Davis-Bacon act.
3. Place all private sector employment on an “at will” basis.

Problem solved.

Well almost.

4. Repeal the Fair Labor Standards Act and all its successor acts, and also any similar state laws.

Ok, problem should be solved now.

DavidB December 19, 2006 at 2:19 pm

repeal human nature

problem SOLVED!

Sione December 19, 2006 at 10:21 pm

DavidB

In the presence of unions with govt granted priviledges it is not possible for management to negotiate as they might want to. In the end the union can severely harm or even destroy the company immediately. The management may well explain to the union and the workers that their demands will ultimately crush the company’s future but the greed of these groups and the power the government gives them makes a rational response unlikely (forbidden in most cases). The usual result is that management cave in (allowing the union thugs to pilfer the shareholder investment in the company and its future). Can you be surprised that in such an environment competance and stewardship is driven out of the management team? Soon enough the senior management gets cynical and starts to pilfer from the company as well. Better steal while there is something to steal. The losers are those shareholders who do not liquidate their positions quickly enough and of course the workforce (who end up discovering that the conditions they “worked” for were illusory). Suckers! The cause is government using its coercive powers to enforce certain behaviours. You’d hardly call this human nature. It’s about volitional choice. What would you do?

Sione

Sione Vatu December 19, 2006 at 10:25 pm

Artisan

Yup. Silly stuff. It seems the Germans never learn!

Strong State = Bad State

No State = Good State!

Regards

Sione

Sione Vatu December 19, 2006 at 10:33 pm

nunyabidness

Your attitude is matched only by your ignorance. It’s likely the reason why you will lose your job along with all those healthcare and superannuation entitlements you thought you’d receive. Retirement for you must be looking very bleak indeed. Enjoy the future. It’s the one you’ve prepared for yourself. Quality living you deserve!

Cheers

Sione

Vanmind December 19, 2006 at 11:43 pm

David Stallings,

The reason so many companies that operate without labor unions end up with management misappropriating funds is because MBAs are just another union.

Also, I meet about ten times as many people who are civilized than those whose strategy for life is to “lie, cheat, steal…”

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