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Morici: Volkswagen Plant Vote in Tennessee Shows Unions Must Change to Survive

Stocks in this article: VLKAY GM

NEW YORK (TheStreet) -- The United Auto Workers' failure to organize workers at the Volkswagen (VLKAY) in Chattanooga, Tenn., shows just how much unions need to change to stay relevant.

Unions represent about 11% of all U.S. workers, down from 20% two decades ago, and less than 7% of private-sector employees. Only in state and local governments do unions hold sway, but that is accomplished by supporting politicians who accede to demands for excessive pensions and benefits that are driving many cities and states to financial ruin.

In the private sector, technology has replaced many blue-collar jobs, and contemporary managers are much more sensitive to workers' needs than in earlier decades.

The South, where much manufacturing has moved to, remains decidedly ant-union, and labor leaders have cultivated much of the public animus.

Many autoworkers at the VW plant blame the recent bankruptcies of General Motors (GM - Get Report) and Chrysler on the UAW's combative behavior. Hundreds of thousands of hardworking blue-collar workers lost jobs at Detroit automakers and suppliers, as the union resisted changes in work rules and insisted on overly generous benefits that kept productivity below and labor costs above foreign-owned plants operating in the U.S. South

Also, many folks in Chattanooga see the UAW as modern-day carpetbaggers preying on their political freedom. Along with virtually all the unions affiliated with the AFL-CIO, the union strongly supports the Democratic Party, abortion rights, gun control and other liberal causes.

Those positions may well suit Northern civil-service unions but are an anathema to many Southern blue-collar workers. They don't want to pay union dues to finance liberal activism and political campaigns.

Labor leaders have argued unfair employer tactics are responsible for a string of union defeats in plant representation elections. In Chattanooga, however, VW openly supported the UAW's organizing efforts and put a gag order on its managers, who being Southerners might have been inclined to criticize the union.


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