McCain distorts truth about UAW concessions

Much attention has been paid to Sen. John McCain’s comment the other day at a Nascar event that Chrysler is unlikely to survive, but that isn’t the only thing he said at the time. He also claimed — falsely — that the bailout happened because the unions refused to negotiate concessions to save the automakers money. His full statement, as quoted by the Detroit News:

McCain suggested the decision to inject billions into the automakers was because of the political clout of the United Auto Workers union — and other unions.

“It was all about the unions. The unions didn’t want to have their very generous contracts renegotiated so we put $80 billion into both General Motors and Chrysler, and anybody believes that Chrysler is going to survive, I’d like to meet them,” McCain said.

One really has to wonder what reality McCain has been experiencing for the last few months. In the real world, not only did the unions make enormous concessions in renegotiating their collective bargaining agreement, but the Obama administration rejected the first round of concessions and forced the UAW back to the negotiating table to give up even more before they would agree to keep GM and Chrysler afloat during bankruptcy.

After GM and Chrysler reached a tentative agreement with the UAW in February on a series of concessions, the Obama administration said the concessions were not enough to keep the automakers afloat and set a deadline for each of them (one month for Chrysler, two months for GM) to reach a new agreement with deeper concessions.

It was only after the UAW agreed to a whole series of concessions — a $7 per hour reduction in wages, shifting some production overseas, significant reductions in health coverage, the swapping of stock for billions of dollars owed to the VEBA healthcare fund, etc. — that the Obama administration agreed to provide debtor-in-possession financing to allow the two companies to go through bankruptcy and not be split up.