News Release

UAW Strike & Chrysler Private Equity Firm


Chris Kutalik is editor of Labor Notes, based in Detroit Michigan. Tiffany Ten Eyck is a correspondent for the magazine. They co-wrote the piece “Jobs, Wages, Health Care, Pensions — All in Jeopardy as Chrysler Is Sold to Private Firm” shortly after Daimler-Chrysler agreed to sell Chrysler to the buyout firm Cerberus Capital Management in May.
More Information

Professor of regional economic development at Case Western University in Ohio, Helper focuses on the auto industry. An interview with Helper titled “Starting on the Shop Floor: The U.S. Auto Industry Shakeup” is the feature story in the new issue of Dollars & Sense magazine.
More Information

Co-director of the Center for Economic and Policy Research, Baker said today: “It is interesting that the members of the United Auto Workers working for Chrysler find themselves on strike against Cerebus, a private equity fund, the day after the Washington Post reported that the Senate Majority Leader Harry Reid had abandoned efforts to take back the special tax breaks enjoyed by private equity funds. While auto workers pay a 25 percent tax rate on their wages, the managers of the private equity fund will pay just a 15 percent tax rate on most of their compensation. If the lobbyists for the equity funds could arrange the same tax break for the UAW members, they probably would agree to immediately end their strike.”

See Tuesday Washington Post front-page story: “Buyout Firms to Avoid a Tax Hike: Reid Passes Word Senate Won’t Act.”
More Information

Professor of history at the University of California at Santa Barbara, Lichtenstein is editor of Wal-Mart: The Face of Twenty-First Century Capitalism and other books on politics and labor. He said today: “The private equity firm that now owns Chrysler is a wild card; they bought the company for a song. They don’t seem to have any long-term perspective on this; they’re not car guys.

“This comes in the context of the UAW having been unable to unionize Toyota and Honda plants in the U.S., so the union’s fate is now linked far too closely to the dwindling set of companies like GM and Chrysler, where it holds collective bargaining relationships.”
More Information

For more information, contact at the Institute for Public Accuracy:
Sam Husseini, (202) 347-0020; or David Zupan, (541) 484-9167.