The American Airlines bankruptcy reveals the scope of President Obama’s political payback to the UAW. Unlike General Motors and Chrysler, American Airlines is undergoing a “normal” Chapter 11 bankruptcy according to the rule of established law. The GM (and Chrysler) bankruptcies of 2009 were directed by a White House task force that upended regular bankruptcy procedures. The White House objective was not to create a competitive new GM, but to get the best deal possible for the UAW and make GM a de facto “Government Motors.”
It’s not that the airline unions failed to deliver for Obama and the Democrats in 2008. The Airline Pilots Association contributed three quarters of a million dollars – small change compared to the UAW’s more than four million to Obama and the Democratic Party. Apparently you have to pony up big to get a deal from Obama.
The White House Auto Task Force and its Czar spared UAW the dismay and outrage of renegotiated union pay scales, revised work rules, and loss of defined-benefit pensions that American Airlines union members face. American’s anticipated fifteen percent job loss is about the same as GM’s, but without a dime of taxpayer money. Obama did not save GM jobs, he saved UAW pay scales and pensions. UAW members left their jobs with a $25,000 new car and $20,000 cash. (Chrysler employees left with much more). Laid-off American Airlines pilots, mechanics and flight attendants will likely leave with little or nothing.
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