The Road to Bankruptcy

Columnist George Will expresses his views of General Motor's financial straits as it tries to deal with a labor legacy created for a less competitive world.

Published: 13-Apr-2006

It is better to be fired by General Motors than it is to be hired by most companies. Remember this when you are rightly ridiculing the riotous French who have successfully insisted that even workers under 26 should have property rights to their jobs. Remember because the accelerating crisis of private-sector welfare states such as GM prefigures the coming crisis of the public sector's entitlements.

France has been convulsed by young people whose sense of entitlement was affronted by a law -- now withdrawn in a triumph of mob rule -- that would have allowed employers to fire a young worker in the first two years of employment. Detroit's crisis also involves an entitlement mentality.

Under contracts negotiated, beginning in 1984, with the United Auto Workers (UAW), there are about 14,700 laid-off autoworkers in the "Jobs Bank." About 7,500 of them are from GM. They get paid most of their wages and benefits -- between $100,000 and $130,000 a year, for an annual cost to GM of $750 million to $900 million.

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