Second-class America

SOYMB reads that four years ago, the United Automobile Workers agreed to allow Chrysler, G.M. and Ford to pay lower wages to new hires. It has allowed the Big Three to reduce labor costs without cutting the pay of incumbent workers. The new workers earn about $14 an hour half of what the longtime employees received. So far, about 12 percent of Chrysler’s 23,000 union workers earn the lower wage, and over all, 4,000 or so of the 112,000 U.A.W. members are second-tier hires. Some benefits for the lower-tier workers are scaled back as well. They get the union’s traditional medical benefits, but a maximum of four weeks paid time off a year, versus five for the longtime workers. And instead of the guaranteed $3,100-a-month pension a full-paid worker receives after age 60, the new hires have to build their own “personal retirement plan” based on contributions from the company of less than $2,000 a year.

At the big Labor Day parade in Detroit, union activists chanted “equal pay for equal work,” and some full-paid workers said they were willing to forgo a wage increase in the new contract to help the lower-tier employees.

As part of the government’s bailout of G.M. and Chrysler, the union agreed that no second-tier worker could move up until 2015 at the earliest. At Ford, which did not receive federal aid, the current contract lets the company fill 20 percent of its union jobs with lower-paid workers before it moves any into the top tier.

At the Jefferson North plant a Jeep Grand Cherokee sport utility vehicle every 48 seconds of the working day at an assembly plant here.

“It would be a shame to work at Chrysler,” one of the low tier workers said said, “and not be able to drive a Chrysler.”
http://www.nytimes.com/2011/09/13/business/in-detroit-two-wage-levels-are-the-new-way-of-work.html?pagewanted=1&_r=1

This week the US Census Bureau has released a survey showing that one in six Americans now live in poverty: the highest number ever reported by the organisation. It also showed that real median household incomes dropped 2.3% in 2010 from the year before. At the same time, the richest 20% of the US population now controls 84% of the wealth. 400 American families have the same net worth as the bottom 50% of the nation.

49.9 million Americans lacked health insurance, a number that soared by 13.3 million since 2000. In 313 counties in America, life expectancy for women has actually declined over the last 20 years. Those in the top 20 percent of American incomes live, on average, at least 6.5 years longer than those in the lowest income group. It showed six million more people have fallen into poverty since 2004. 21.6 percent of American children live in poverty, the rate is 3.7 percent in Denmark, 5.3 percent in Finland, 6.7 percent in Iceland, 8.3 percent in Germany, 9.3 percent in France. Sen. Bernie Sanders said "I suppose we can take some comfort in that our numbers are not quite as bad as Turkey (23.5 percent); Chile (24 percent); and Mexico (25.8 percent),"