BEWARE OF FACTIONS OR THE U.A.W

"Among the numerous advantages promised by a well constructed Union, none deserves to be more accurately developed than its tendency to break and control the violence of faction. The friend of popular governments never finds himself so much alarmed for their character and fate, as when he contemplates their propensity to this dangerous vice…
By a faction I understand a number of citizens, whether amounting to a majority or minority of the whole, who are united and actuated by some common impulse of passion, or of interest, adverse to the rights of other citizens, or to the permanent and aggregate interests of the community." (Federalist #10)
What is the real problem with General Motors is it the U.S. government, maybe it’s the bondholders or could it be the UAW? What I say is we have ourselves a faction, which two is the debate we will discuss in this commentary. The most blame should and does rest with GM, they created this situation. With all the thinking heads they should have seen this coming ten or more years ago, they saw how Toyota and others were taking over chose to ignore it. Maybe they should have looked back at Henry Ford model of selling by volume, worked for him. They also took the money around $18 billion that’s a lot of money, now the bondholders are getting money and the UAW is getting more than their fair share.
The bondholder’s maybe the only innocent group in this hold mess. All they want is a return on their investments, which is the whole concept of investing. The last offer is they will trade over $27 billion in GM bonds for a 10% stake equity stake in the new restructured company. So they are now a stumbling block, you would think they should jump right on that, who wouldn’t want 10% of a doomed company. Same as you being an investor in a lemonade stand which stopped making money in September, so for your $5,000 we are going to wait for the first blizzard remove the top and give you 10% stake come December. Why wouldn’t you jump on that?
The UAW prime example of a faction in my opinion, they are only about the good for members of their interest group. They don’t seem to care if GM goes out of business or not thus sinking the ship for both union and none union workers. They have such a strangle hold on all the auto makers, that’s why in this new deal for the $20 billion owed to the retirement fund they get 39% interest in the new restructured company vs. the bondholder’s getting 10% for $27 billion.
So it’s up to us to break and control the faction “There are two methods of curing the mischiefs of faction: the one, by removing its causes; the other, by controlling its effects.” As stated by Madison in Federalist #10, but since we can’t use these tactics also stated by Madison because it would be worse than the faction. We can if they don’t get their act together and lower their wages, lower the car prices you can sell them as volume and still make money or keep them and go to Arizona and make a bone yard next to the aircraft one. If not we can take the next step from federalist #10 by forming our own majority and buying Ford products.