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    Different "locals" do it different ways


    By Nick, Section News
    Posted on Mon Oct 22, 2007 at 07:00:37 AM EST

    Boy do different locals do it different ways.  And no, I'm not just talking about UAW locals and their current round of voting on the union negotiated and officially proposed contract from Chrysler (though I'll get there in a minute).  I'm talking about local units of government in Michigan handling business in very different ways.  And yes, I AM talking about business.

    Lets start with the good, shall we?  This morning we learn in the Associated Press that there's a move afoot in Macomb County's Washington Township to permit a new business venture that would take garbage, burn it and turn it into electricity.

    A plant could be operating in the county in two years, said Marcello Iannucci, SunCrest's founder and president.

    "Right now waste is a negative commodity," Iannucci said. "We want to turn it into a positive commodity."

    The plant would move trash through heat, converting it to gas to be run through turbines that generate electricity, the newspaper said.

    Genius, isn't it?  We hear constantly about how terrible new power plants are for the environment and we hear constantly about how terrible it is to bury garbage in the ground and how we can't possibly bury any more and we hear constantly about how that old Native American guy in the PSA's cries every time someone throws an aluminum can out a car window... ok, so we hear constantly about the first two and the third just replays in my head more often than I'd like, but you get my drift (and I've never tossed away a pop can, chief).

    So what's happening in Washington Township is this:  The private sector saw a problem.  Someone saw it as an opportunity.  They seized that opportunity.  Now the folks in Washington Township are hoping to clear the way for the construction of an operation that kills two birds with one stone and all without directives coming down from the central planning committee in Lansing!

    Read on...

    It's amazing what happens when you let the market run it's course.  When you let business people identify needs and address them.  They just seem to find ways to deal with problems and turn a profit at the same time, putting Michigan moms and dads to work.  It's genius.  Which is the complete opposite of a recent proposal in our Capitol city's local government.

    The LSJ reports this morning that the far-left Lansing City Council is considering a move to saddle the city's taxpayers with grossly higher operating costs in a move to line union leader's pockets and eliminate any remnant of a non-union work force.  They're seriously considering (read: just about ready to approve) a new and improved prevailing wage law.

    Any project costing more than $50,000 that receives assistance from the city - whether in the form of tax breaks, grants or other aid - would fall under the prevailing wage rules...

    Requiring a prevailing wage for all workers likely would kill projects such as the nearly $60 million Ball Park North and Market Place developments announced last week, developer Pat Gillespie said. Gillepsie wants to build housing, retail and office space north of Oldsmobile Park and on the site of the Lansing City Market.

    "It will probably hurt it to the point where it does not make economic sense to do," he said. "There aren't enough tax incentives to make up for it."

    Developer Shawn Elliott estimates the prevailing wage requirement would add $600,000 to the cost of a proposed $22.4 million downtown condominium high-rise he's working on.

    "But that makes the project fail," he said, because profit margins become too small to meet bank financing requirements. He said he already expects the project would be 80 percent union labor without the ordinance.

    For the uninitiated and in a nutshell, prevailing wage means that the city is required to pay union wages for any job function (within the set limits) that could be performed by union workers.  It grossly inflates costs and burns tax dollars.  But the union guys love it... it kills their competition.  

    Of course, it also kills projects and, by extension, jobs.  Lots of them.  In the two examples that LSJ tracked down right off the top we're talking over $80 million worth of local construction and development.  And that's more than just construction jobs up in smoke.  It also means that the jobs those projects would build after their completion will never be realized.  It takes all of that money out of the local economy meaning restaurants, coffee houses and other service and support businesses around the project sites will go without.

    It's a born-to-lose deal.  Unless you're a far-left politician looking to pay back campaign favors.  

    Then again, the 21st century incarnation of the once venerable and world changing "union" seems to specialize in lose-lose outcomes lately, and here we come to the continued voting process at the UAW.

    It was a couple weeks ago now that Ron Gettelfinger announced a deal with Chrysler after a short-lived strike.  All that was left was the perfunctory approval of a majority of the local... well... locals.  But as this morning's Detroit Free Press tells us, that's no longer all that perfunctory.  

    While seven Locals representing about 9,000 workers across the country have so far voted YES...

    Six locals representing around 11,000 of the UAW's 45,000 Chrysler workers have so far rejected the proposed contract. The previous contract was to expire Sept. 14, but was extended during talks that led to the new deal Oct. 10.

    On Sunday, Local 7, which represents about 2,200 workers at Jefferson North, went about 60% against the deal, a person familiar with the results told the Free Press. That plant was in line for a new generation of crossover vehicles and had been lobbied by UAW leaders.

    All eyes were on Jefferson North yesterday.  It's considered to be one of the true bellwethers in this process.  So what happens if more Locals follow it's lead and the United Auto Workers tell Chrysler "no thanks?"

    "If the contract is not ratified they have to go back to the bargaining table and negotiate, but what that usually means -- or can typically mean, not always -- is that they will not get a better deal, they will get a worse deal" from the union's perspective, said Arthur Wheaton, a labor expert from Cornell University. "Because the UAW leadership, Gettelfinger in this case, would lose face and lose credibility."

    Lose-lose... lose.  There should really be three "loses" in there.  I know the economy is booming in 49 other states but the news last week out of Michigan was that we had the highest unemployment rate in the nation at 7.5% (and growing month to month).  Extended labor unrest in our biggest industry is not so good.  And it's the last thing the UAW negotiators want to worry about right now, too, as they prepare to deal with Ford, the last and by far toughest of the Big 3 with whom they still have no contract extension.

    And another long-term work stoppage among tens of thousands of Michigan workers?  That's the last thing this state needs to worry about right now.

    < Recall Schauer | Granholm endorses Clinton and I've got a few questions >
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    7.5% ??? (none / 0) (#1)
    by DMOnline on Mon Oct 22, 2007 at 11:25:06 AM EST
    One might think with the caravan of U-Hauls crossing the border carrying Michigan residents fleeing our state, that the unemployment rate would actually go down.  

    After all, if many of the chronically unemployed are leaving this state to find jobs in other states where they have them, wouldn't it stand to reason that our unemployment rate should go down - not up?

    It's a real testament to the deft management of our state's economy by Mrs. Granholm and her lackeys in the state house and senate.  Take a very bad situation and exacerbate it.  They've got that down to an art form.

    DMOnline

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