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Thursday, February 5, 2015 — 3A

of the assembly line in 1913 used to 
create the Ford Model T.

Fast forward to the 21st century. 

Even before Detroit filed for bank-
ruptcy, the industry’s production 
was not what it used to be. Car com-
panies struggled as the economy’s 
health declined. In response, the 
U.S. government created a short 
incentive program, called Cash 
for Clunkers, designed to renew 
demand for vehicles at a time when 
the market struggled for cash. 
Between July and August 2009, 
buyers who turned in old, fuel-inef-
ficient vehicles received a financial 
break on a new car.

Yen Chen, a senior research 

economist at the Center for Auto-
motive Research in Ann Arbor, co-
published a research memorandum 
in 2010 documenting the program’s 
success. He found that 44 percent of 
light vehicles sold in these months 
were due to the program.

“For the first time in a long time, 

the industry experienced the first 
signs of recovery,” Chen said.

As production rebounded, work-

ers returned to production lines. 
Chrysler and General Motors com-
pleted restructuring and a planned 
bankruptcy that shut down produc-
tion during most of the summer 
of 2009. Combined with external 
monetary support and a healing 
economy, the industry began to take 
a turn for the better.

As the economy stabilized and 

Americans 
found 
employment, 

Chen said those workers also pur-
chased cars to ensure their ability to 
get to work.

“When people find jobs, they 

need a vehicle to commute,” he said. 
“The major reason behind vehicle 
sale, from my point of view, is full-
time employment. People find full 
time employment, they need to be 
able to commute daily.”

Schwartz, who was general 

director of labor relations at Gen-
eral Motors during the mid-1980s, 
was responsible for planning union 
negotiations.

Schwartz remained on the team 

through the restructuring of 2009. 
He recalled the negotiations that 
attempted to halt decline.

“In ’07 the company was sink-

ing, so something had to be done,” 
he said.

He cited labor laws as one factor, 

along with disputes over General 
Motors’ wages compared to those of 
Toyota. Another important issue, he 
said, resulted from General Motors’ 
retirees relying on pensions. Their 
number of retirees was larger than 
a company like Toyota, which was 
much newer to the United States.

“We were carrying hundreds of 

thousands of retirees, but of course, 

since Toyota didn’t come in until 
1988, they weren’t carrying hardly 
anything at all,” he said.

That year, General Motors nego-

tiated to turn the liability of about 
400,000 of its retirees to the Volun-
tary Employee Beneficiary Associa-
tion, a type of trust fund permitted 
under federal tax law. Though this 
wouldn’t take effect until 2010, the 
move freed General Motors from 
a significant amount of financial 
responsibility.

“Billions came off the books,” 

Schwartz said.

Another major, still controversial 

aspect of that year’s negotiations 
was the creation of a two-tier wage. 
Because wages were relatively high 
for workers not staffing the line, 
especially compared to Toyota, the 
company decided that incoming 
workers would receive a starting 
salary of $16 per hour instead of 
$28.50.

Schwartz said the goal was to pay 

less for easier jobs. However, work-
ers who had been with the company 
for many years had earned senior-
ity, and thus tended to opt for easier 
work. To avoid paying senior work-
ers less, negotiators decided that the 
lower, second-tier wages would be 
automatically given to new workers.

“VEBA and second-tier wages 

went a long way in reducing the gap 
between the Big Three and Toyota, 
Honda, Nissan as far as labor rates 
are concerned,” Schwartz said. 
“Plus, we could bring more work 
into the plant.”

However, the climate took a bad 

turn when the 2008 financial crisis 
occurred. Sales dropped by about 
40 percent, a significant decrease 
for automobile manufacturers. Ford 
was able to borrow money from 
private financial institutions, but 
Chrysler and General Motors had 
to turn to the government after the 
banking crisis hit the private sector. 
This led to the 2009 negotiations 
that involved the undoing of the 
second-tier wage ceiling and the 
discontinuation of a long-standing 
jobs bank, a program that allowed 
laid off workers to continue receiv-
ing some benefits.

“The whole contract was very 

painful for everybody, especially 
the union,” Schwartz said. “I give 
them a lot of credit on the ‘09 nego-
tiation.”

Schwartz expressed the widely 

held belief that the government 
came out ahead by avoiding the 
cost of social welfare that would 
have resulted if General Motors 
had gone bankrupt.

In terms of Detroit as an indus-

try city, Schwartz thinks it’s mak-
ing a comeback.

“We really haven’t picked up 

any market share, but we haven’t 
lost like we were losing before and 
sales are good,” Schwartz said. 
“We’re making money.”

can in every community has a 
right to pursue happiness,” Bush 
said Wednesday. “They have a 
right to rise.”

Bush told the crowd that since 

the 2008 economic recession, 
the country has seen some eco-
nomic relief, but still has a long 
way to go.

“The recovery has been every-

where but in the family pay-
checks,” he said. “The American 
Dream has become a mirage for 
far too many.”

Speaking specifically to the 

younger demographic, Bush said 
Americans need to embrace the 
period they live in and view their 
difficulties as economic oppor-
tunities.

“We need young, dynamic 

people that can make immediate 
contribution to our economy,” 
Bush said. “We shouldn’t be fear-
ful of this. We should say, ‘What 
an incredible opportunity.’”

He said to the solution to 

increasing opportunity is grow-
ing the economy, citing problems 
with the American education 
system as connected the state of 

the country’s economy.

“It’s an economic issue, but it’s 

also a huge moral issue,” Bush 
said on education. “Our country 
doesn’t do this well. These huge 
(income) gaps that exist are now 
increasing because of education 
dropouts. This is not the envi-
ronment that has led the world.”

Bush said he aims for the U.S. 

economy not to accept anything 
less than an annual 4-percent 
growth rate, which he added 
could contribute to narrowing 
the opportunity gap.

“Trust me, if we grew at 4 per-

cent, our growth, income rising 
from the middle, people have 
a chance to leave poverty, we 
would help other countries that 
will prepare to follow suit,” he 
said.

Bush also said immigration 

reform should be viewed as an 
economic issue, not a political 
issue.

Immigration has been moved 

to the forefront of the nation-
al political agenda, recently 
following 
President 
Barack 

Obama’s controversial plan to 
expand eligibility for immigra-
tion deferral. Republicans have 
unsuccessfully voted twice to 
defund the plan in recent weeks.

Bush added that Americans 

and immigrants should cherish 
their heritage and identity.

“In that, we would reestablish 

this unique American experi-
ence, which is you come, you 
work hard, you embrace these 
values and you’re as American as 
anybody that came on the May-
flower,” he said.

Addressing 
his 
as-of-yet 

uncertain 2016 campaign, Bush 
said if he decides to run, he 
does not want to participate in 
the negative rhetoric associated 
with campaigns.

“If I go beyond the consid-

eration, I hope I have the dis-
cipline to not turn back and get 
into the food fights,” Bush said.

State and national Democrats 

responded strongly to Bush’s 
speech Wednesday citing what 
has become a familiar criticism 
for Republicans in Detroit — 
criticism of their stances on the 
2008 auto bailout. That point 
was also raised during the 2012 
election for then-presidential 
candidate Mitt Romney, who 
penned an editorial in 2008 
titled “Let Detroit Go Bank-
rupt.”.

Obama delivered a speech in 

Metro Detroit last month tout-

ing his administration’s efforts 
to strengthen the auto industry.

“Jeb Bush has an interesting 

sense of humor going to Detroit 
to talk about urban revitaliza-
tion, after opposing the auto 
rescue that is helping Detroit 
and Michigan rebound from the 
recession,” said U.S. House Rep. 
Debbie Wasserman Schultz (D–
Fla.), chair of the Democratic 
National Committee, in a state-
ment. “But it shouldn’t come 
as a surprise. This is the same 
guy who supports massive tax 
breaks benefitting the wealthi-
est Americans and biggest cor-
porations at the expense of 
working Americans. And it’s the 
same guy who has spent much of 
the past decade enriching him-
self at big banks and concocting 
problematic business deals.”

Bush is not the first potential 

presidential candidate to stop in 
Metro Detroit in recent months. 
In November, former Secretary 
of State Hillary Clinton cam-
paigned for Democratic candi-
dates in Rochester Hills, Mich. 
In August, Sen. Elizabeth War-
ren (D-Mass.) campaigned for 
then Rep. Gary Peters during his 
successful campaign for the U.S. 
Senate.

BUSH
From Page 1A

AUTOS
From Page 1A

relations with Cuba, including 
a push to end a trade embargo 
between the two countries. The 
announcement signaled an end-
ing to a decades-long period of 
no formal relationship between 
the two countries.

The program, held at the Ford 

School, was co-sponsored by 
the Center for Latin American 
and Caribbean Studies, Michi-
gan News, the Ford School of 
Public Policy’s International 
Policy Center and the Cuban 
Research Institute at Florida 
International University.

The 
panelists 
included 

Anthropology Prof. Ruth Behar; 
Silvia Pedraza, sociology and 
American 
culture 
professor, 

Pedraza and Public Policy Prof. 

Melvyn Levitsky, the former 
U.S. ambassador to Brazil.

Pedraza 
highlighted 
the 

ambitions 
both 
countries 

brought to the negotiation pro-
cess, which included immigra-
tion and travel policies; U.S. 
possession of Guantanamo Bay; 
the trade embargo levied by the 
U.S against Cuba and access 
to 
telecommunications 
for 

Cubans.

She said she believed the 

United States and Cuba would 
come to agreement on a number 
of those concerns, but that some 
issues would remain points of 
contention.

Levitsky said because more 

than 160 countries currently 
have relations with Cuba, in 
general, having a diplomatic 
relationship with the country 
is no longer viewed as excep-
tional.

He added that he thinks for-

mal relations with the country 
have an impact on relationships 
beyond the government itself.

“It’s important to have diplo-

matic relations so that you can 
have a dialogue with the gov-
ernment even if it’s an unfriend-
ly relationship,” Levitsky said. 
“An establishment of relations 
does not suddenly mean we’re 
going to become friends with 
the Cuban government. But it 
may, in fact, allow us to become 
more friendly and closer up 
with the Cuban population.”

LSA senior Marianna Yama-

moto, who attended the panel, 
said she thought the three dif-
ferent perspectives on the panel 
provided a well-rounded bal-
ance of expertise across subject 
areas.

“This is something that’s 

happening now,” she said. “It’s 

really going to affect our future 
and we have a lot to look for-
ward to, I guess, and see how 
this plays out, and I think we 
can all learn a lot from the situ-
ation.”

Lenny 
Valerio, 
program 

manager at the Center for Latin 
American and Caribbean Stud-
ies, said she anticipated more 
events on U.S.-Cuban relations 
in the future.

“We hope to keep organizing 

events not only on U.S.-Cuba 
relations, but also on Cuba’s 
own historical, cultural and 
political relations to other Latin 
American countries,” she wrote 
in an e-mail interview. “I think 
that the re-establishment of 
diplomatic relations with the 
U.S. is an excellent moment to 
reassess Cuba’s influence in 
Latin America and the Carib-
bean.”

CUBA
From Page 1A

said that he didn’t view the 
potential recruiting obstacles in 
his way as impediments.

“It wasn’t difficult — it was a 

real joy, a real pleasure,” Har-
baugh said. “Just the things 
that I learned about some of the 
players that were already com-
mitted under Coach Hoke and 
his regime, and they did a tre-
mendous job.”

Harbaugh’s first recruiting 

class at Michigan will consist 
of 14 players, just six of which 
were 
committed 
to 
Michi-

gan before Harbaugh’s hiring. 
Though Harbaugh said that 
the recruiting process hasn’t 
changed a great deal since he 
last recruited at Stanford five 
years ago, he noted that begin-
ning his new role required some 
level of adjustment.

“Did I just go right into it and 

pick up where I left off back 
when I coached at Stanford? 
No, I picked up two days after 
an NFL season,” Harbaugh said. 
“Had to familiarize yourself 
with who the players are, high 

school coaches again, hadn’t 
spent a whole fall evaluating 
tape coaching the San Francisco 
49ers.”

Toughness 
and 
competi-

tiveness were two of the key 
attributes that Harbaugh was 
searching for in this recruiting 
class. Given the late start for his 
staff, a class filled with four- 
and five-star players seemed 
unlikely. Still, Michigan man-
aged to pull off some surprises, 
compiling a class that had four 
players ranked among ESPN’s 
top 300 recruits.

One of those players is four-

star quarterback Zach Gen-
try, 
who 
Harbaugh 
flipped 

from Texas on Jan. 24. Gentry 
and another four-star recruit 
according to ESPN, early enroll-
ee Alex Malzone, will bolster 
the depth of Michigan’s quar-
terback corps, a position group 
that returns minimal experi-
ence.

But it wasn’t positional needs 

that seemed to excite Harbaugh 
most for this class. Known for 
his competitive nature, there 
seemed to be an extra sense of 
pride in Harbaugh’s voice when 
he talked about the competitive-

ness of the players, particularly 
Keith Washington, a relatively 
unheralded cornerback recruit 
from Alabama, who committed 
to and signed with the Wolver-
ines on Wednesday.

When Harbaugh and defen-

sive coordinator D.J. Durkin 
went to Alabama to visit, they 
sat 
with 
Washington 
and 

his father, discussing Wash-
ington’s 
speed. 
Washington 

claimed to run a 4.3 40-yard 
dash time, which would be on 
par with some of the faster 
players in the NFL. Initially, 
Harbaugh doubted his claim.

“He goes, ‘I’ll go out in the 

parking lot and run it for you 
right now,’ ” Harbaugh said 
with a laugh. “And he was seri-
ous, dead serious. I liked him 
even more. I knew he was a 
competitor.”

The Michigan ties of his 

recruits were another point 
of pride for Harbaugh. One 
was three-star recruit Jon 
Runyan Jr., the son of former 
Michigan star Jon Runyan. 
Harbaugh said he was told 
Runyan Jr. wore a Michigan 
onesie when he was a year old. 
Kicker Andrew David grew up 

a Michigan fan. Harbaugh said 
four-star safety Tyree Kinnel 
was handed a Michigan foot-
ball at birth. Grant Perry — a 
three-star wide receiver who 
attended Birmingham (Michi-
gan) Brother Rice along with 
Malzone — grew up getting 
autographs 
from 
Wolverine 

football players.

After Harbaugh’s presser, 

Michigan added another player 
with close ties to the program 
in three-star tight end recruit 
T.J. Wheatley Jr., the son of 
Michigan running backs coach 
Ty Wheatley, a former Wolver-
ine standout himself.

Harbaugh said he hasn’t 

watched a great deal of tape yet 
on his current team, instead 
preferring to give all of his 
players the opportunity to 
make a first impression. The 
same logic will apply when 
assessing early playing time for 
the members of this recruiting 
class.

“They have the license and 

the ability to do that,” Har-
baugh said. “All things will be 
earned on the field. There’s no 
guarantees, 
only 
opportuni-

ties.”

SIGNING DAY
From Page 1A

opposite-sex couples. They are 
all marriages, full stop, for the 
purpose of every distinction as 
to which that question is rel-
evant under Michigan law.”

The 300 marriages were per-

formed during a brief window 
between a separate district 
court decision — which ruled 
the state’s same-sex marriage 
ban unconstitutional — and a 
stay on that decision. The mar-
riages faced legal uncertainty 
while a larger legal battle over 
the legality of same-sex mar-
riage nationwide ensued.

Michigan’s ban on same-sex 

marriage is currently before 

the U.S Supreme Court, with 
oral arguments expected to 
occur in April, after the Sixth 
Circuit ruled late last year that 
the ban was constitutional, 
overturning the district court’s 
decision.

Snyder said he looked for-

ward to that ruling to deter-
mine the overall legality of 
same-sex marriage.

“This is an issue that has 

been divisive across our coun-
try,” he said, “Our nation’s 
highest court will decide this 
issue. I know there are strong 
feelings on both sides of this 
issue, and it’s vitally important 
for an expedient resolution that 
will allow people in Michigan, 
as well as other states, to move 
forward together on the other 

challenges we face.”

Proponents of same-sex mar-

riage in the state and beyond 
applauded the decision to let 
the marriages stand Monday 
afternoon.

Ingham County Clerk Barb 

Byrum, who was one of several 
county clerks to issue licenses 
to same-sex couples in March, 
said in a statement that the 
decision was the right choice 
for the state.

Because the district court 

decision occurred over the 
weekend, not all clerks opened 
their offices.

“Love has won today for the 

300 same-sex marriages that 
took place last spring, affording 
these couples the rights they 
deserve, like all other families 

under the law,” Byrum said. 
“This is a critical step forward 
in our fight to secure the free-
dom to marry for all Michigan-
ders.”

Brad O’Connor, president of 

the Jim Toy Community Cen-
ter, which serves as a resource 
for the LGBTQ community in 
Washtenaw County, commend-
ed Snyder on saving taxpayer 
money through not pursuing 
the case further, though he 
noted the state was still pursu-
ing an appeal of the case on the 
same-sex marriage ban.

“I’m relieved that the gover-

nor decided to not appeal this,” 
he said. “I commend him for 
taking the taxpayers into con-
sideration — it’s a good step.”

MARRIAGE
From Page 1A

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