Do Japanese Workers Have a Socialized Healthcare System?

[fascisthunter]

I recall hearing Hartmann stating briefly that the "right" likes to compare overhead costs of American auto manufacturers for its employees to the overhead costs of Japanese auto manufacturers, yet that comparison is a false one. Is it because that overhead for Japanese auto manufacturing workers is already socialized?

Also,

How does retirement in Japan work?

[Ian David]

1. Yes, they have government healthcare.

Not sure if the government pays their pensions.

And their industry has always been subsidized and protected by their government.

[Idealism]

2. Yes they have universal health care and

the Japanese government pays into a pension fund for their workers retirements. Toyota/Nissan/Honda do not pay legacy costs in Japanese plants

[wellst0nev0ter]

3. Eh, Kind Of

More socialized than us anyways. Basically it costs about $100 dollars out of your pocket to go to the doctor for checkups and routine procedures. Not sure if it's more for major operations, but I'm sure it won't leave you in the poorhouse.

[CBGLuthier]

4. price controlled

Heard an NPR report a few months ago and the main key was that the government mandated maximum costs for all health procedures and they were real cheap compared to the US.

The government offers insurance for those who don't get it from employers. Elderly get free care.

[Warren Stupidity]

5. They have a strictly regulated universal mandate system.

Government sets all fees for procedures and prescriptions. Everyone has to buy insurance either through corporate benefit programs or a national insurance system. Some basic health care services (screening prenatal care etc.) are free to everyone and paid for by the government.

Here: http://en.wikipedia.org/wiki/Health_care_in_Japan

It is actually a model that we could adopt, although I personally think we should just expand medicare to everyone.

[Statistical]

6. Not really relevant for the comparison..

Of course the majority of the foreign cars sold in the US are made in the US by American auto workers.
None of which get health care from the govt.

Even excluding retiree health care & pension costs UAW labor is STILL about 25% MORE than workers at plants owned by the transplants. When UAW says they are "competitive" they are using fuzzy math. NEW workers are hired on a 2nd tier. The lower 2nd tier is competitive, that doesn't change ANYTHING about the 200K workers currently employed. Given that the big likely need to downside 20%-30% over next couple years what % does anyone think NEW workers will make up.

So in 10-15 years it will matter but today labor is simply too high for UAW plants. That will HAVE to change for the Big3 to be profitable.

What most people forget is GM sold MORE vehicles in 2005, 2006, 2007 & 2008 than anyone else. Yet they continue to lose money.

Consumers won't pay substantially more for a GM vehicle. The higher labor costs make the vehicles they do sell, be sold at a loss. Selling more cars won't fix the problem when they are being sold at a loss.

[ret5hd]

7. How does Ford do it?

[madokie]

Build a better product than the others

and sell the hell of out of them and have a better business policy plus make better business decisions is why they aren't in the same boat as gm and chrysler. I know kinda sorta off topic but thats how ford does it.

[ret5hd]

9. Kinda my point. It's NOT the UAW's fault OR UAW wages. It's MANAGEMENT!

As usual!

[madokie]

10. You're right its not the union or the union employees fault

They are all doing a fine job, its their bosses who fucked it up.

[Statistical]

12. GM sold more vehicles than ford.

Sales is not the problem.

People say that GM product sucks and nobody will buy it and that is why the company is failing.

Nothing could be further from the truth. GM sales exceed EVERY SINGLE auto maker in the world.

GM cost of production are what is too high
* labor costs = too high
* too many plants
* too many brands
* too many dealerships.

GM "footprint" in terms of employees, brands, dealerships, and plants would be the "right size" if they have 40%-50% of the marketshare. GM only has 32% of the marketshare. They need to be 32% of marketshare sized company.

They need to sell LESS vehicles produced at a lower cost with higher margins per vehicle.

What is different about Ford?
Ford reduced their workforce by about 20% over the last decade - GM failed to do so.
Ford closed 16 plants in the last 5 years. GM has closed 2 (one of which the employees are still being paid).
Ford sold/killed 3 brands in that last decade. GM has sold/killed 0.
Ford has about 4300 dealerships. GM has about 6000. (Also to put that in perspective Toyota has 1200, Honda has 1000, and VW has 850).
Ford sells 20% LESS vehicles than Ford however because their costs are lower on per vehicle basis and their fixed enterprise costs are lower they are PROFITABLE despite being smaller.

IF GM were to sell 10% more vehicles next year they would simply bleed 10% faster.

[ret5hd]

14. So you are saying Ford pays substantially less than GM or not?

I say not.

Which says UAW wages aren't the problem.

Which says that Ford management is doing something different than GM's.

Some of those things might be listed in your post.

But it ain't wages.

[Statistical]

18. It isn't ONLY the UAW problem.

I agree that Ford has done a better job:

Cutting workforce, cutting dealerships, cutting brands.

Optimizing platforms and much more.

You can only squeeze so much from a stone though.
Ford operating costs are still to high.

Ford is fine when the economy is good but their margins are too low. They have no "flex" no ability to absorb long term slowdowns.

Ford doesn't need $$$ today. They didn't even ask for any in the bailouts (only asked for a $6 B emergency line of credit).
The recession isn't over. IF the recession drags on another year (or two or three) Ford will fail also.

Long term (say 10, 20, 30 years) Ford, GM & Chrysler (I think big C is finished) will need to compete on MERIT only. The idea of an "american brand" is weakening with each generation.

Higher labor will make Ford's products more expensive. Period. Can Ford generate enough "value" to justify a higher price tag on the lot. Maybe but it is doubtful. Honda & Toyota are extremely well run companies. They work hard to justify their prices and will leave litte room for Ford to compete. If Ford costs don't drop their marketshare will continue to slide. As it slides their fixed costs eat into per vehicle profit and they become less and less competitive.

Given the HORRIBLE product reliability, quality, and value in the 1980s and 1990s of the Big3 I would say that feature for feature, option for option they need to be CHEAPER to convince consumers to give them another chance.

Imagine typical American consumer. He owned a Ford/GM/Chrysler in 1980s & 1990s. He got burned. He bought a Honda and loved it. He wants to give GM another try. What will make him give GM another chance? Logic would say that GM needs to be a BETTER (not equal) value. IF the GM & Honda are equal values he will stick w/ the product he knows is good. Right? To think otherwise is simply foolish. Now If the GM/Ford vehicle is a BETTER value he may give them another chance.

[PeaceNikki]

25. They planned more wisely

Ford set up $23.5 billion worth of credit in 2006. The borrowing, coupled with restructuring and new product plans, will get them through the recession without relying on the government. They cut factory capacity to match demand. They anticipate no further cuts will be necessary as long as the U.S. auto market doesn't worsen considerably. Ford also had been working on improving its fuel efficiency long before there was talk of bailing out.

[Hannah Bell]

8. GM made a profit on its automaking business in 2007.

Where they lost money was on their finance business & by taking saved-up tax charges.

They don't sell their cars at a loss.

GM has fewer than 700,000 global employees, retirees & dependents. Even if they gave them all $1000/mo for health insurance, it would cost less than 5% of their gross income.

[Statistical]

15. So how do you think that financial loss occured.

GM subsidized vehicles by offering 0% for longer and deeper than anyone else.

They lost money on financing to artificially keep sales form tanking.
They also lowered the credit requirement for 0% (previously was 720+ FICO to a 680+ FICO or 640+ FICO w/ mortgage).

0% "cost" GM about $2200 per vehicle. The losses for defaults (you can't offer 0% without cost, there is no interest to absorb the % of people who won't pay) cost them even more.

Also your idea of "income" is not based on any respected financial system.
GM has a lot of cashflow or sales = REVENUE. Revenue isn't income.
GM had $181 Billion in revenue. They sell more cars than anyone in the world. That isn't the problem.
GM has NEGATIVE earnings. $100 per month * 12 mo * 700,000 employees = $8.4 BILLION per year.

Another way to look at it:
I could start a business where I sell $100 dollar bills (i.e. ben franklins) for $80.
I would have insane REVENUE. Likely I would sell out every month.
My earnings would be -20%. There is no way that business model is going to get better just because I sell more.

[Hannah Bell]

24. The financing they lost money on was home mortgages, not cars.

They didn't lose money on their auto business. So they say in their 2007 annual report.

Maybe they're lying & you know better. Or maybe you should read the annual report, because what you're posting has no relation to what the corporation says in the annual report.

The biggest "loss" was a paper loss, the booking of saved-up tax credit thingees in 3 countries.

[CreekDog]

11. if you are saying their wages have to be reduced, you are in the wrong place

really.

i mean if that's really the solution (and it isn't).

well just fuck it all. then we are all resigned to unemployment and poverty until we agree to employment and poverty. :banghead:

so sick of this crap. :rant:

[Statistical]

13. Long term wages will equal the transplants wages or the big3 will die.

Long term wages will equal the transplants wages or the big3 will die.

UAW workers don't "produce more" per hour than a transplant worker does.
So if they are paid more and do the same work then the vehicle costs more.

Consumers have already shown by their wallet that won't pay more to get the same (or less) just because it has a GM or Ford logo on it.

So long term GM needs to raise revenue per vehicle. Selling more vehicles is not going to help. GM already sells more vehicles than anyone else.

So if the UAW doesn't agree to a wage cut eventually GM will fail despite bailouts. Maybe it will take 3-4 years, maybe it will take a decade but slowly overtime GM will bleed out.

When GM fails all the workers are out of a job. Toyota, Honda, VW will build more plants and they will hire more workers but it will be at the wages they dictate.

[CreekDog]

16. if the higher wages are phasing out then why will the big 3 die out?

the lower tiers will make up a larger and larger proportion and thereby reduce wages of Big 3 overall.

not only that, at $14/hour for new hires, i gotta tell ya, that's not much of a solution.

if that's the key to our economy then $14/hour means we are going to be a nation in poverty.

[Statistical]

19. Becase GM won't live that long

$14 is STARTING wage for new hires PLUS bonuses PLUS overtime PLUS merit raises PLUS cost of living raises.

The problem is GM workforce will be DECLINING. GM is heavy about 200K or so employees.

Contracts prohibit them firing existing employees just to hire newer lower cost employees (as they should).
Contracts also make it VERY expensive for GM to layoff employees in general (Generally compensation pkg of 4-5 years = $100K-$250K+).

So likely GM will try to let attrition take care of it's workforce. IT WILL NOT BE HIRING. Instead let people retire or quit to slowly bring workforce numbers down.

These new "lower cost" employees won't be around in sufficient numbers for a decade.

So GM business model is to lose money for a decade in hope that lower labor costs in 2020 will save them?

[CreekDog]

20. the Japanese plants in the US also pay overtime, merit raises and cost of living

this is ridiculous.

look, constant arguing that wages are too high is not something Democratic Underground is for in my view.

why do you come here to say this?

[Statistical]

21. Sorry to pretend it is not a problem helps nobody

Average Salary at Toyota (for production worker): $43,800
that doesn't include bonuses or overtime. Also most of Toyota workers are less than 10 years on the job so the number is likely to rise.

Average Median Income in the United State: $40,160 (median household income is $50,000 but that include two income households).

So IF GM employees make MORE than Toyota employees and MORE than the median income in the US would you say they are earning TOO much?

Average GM hourly wage (not including benefits or legacy retiree costs): $28.75 per hour. Average worker works 156 hours of overtime annually (per GM annual report). $28.75*2000 + 156*28.75*1.5 = $64,227.

$64,227 a year. With no college. No student loans to repay for the next 20 years. $64,227 almost 50% more than the median income in the US.

And they should accept no pay cut? Nothing? Despite being one of the best compensated fields and happen to be in an industry that has been losing money for years.

WHY should GM employees make more than workers in other industries that are NOT failing?
Why should any taxpayer making less than $64,000* pay taxes be expected to support a bailout year and year ($14 B is just enough to last till Mar) of an industry unwilling to accept a pay cut.

Even a 15% paycut would reduce GM operating costs 6.7 BILLION! That would erase 1/4 of the loss from last year.

Nobody is saying GM plant workers should make min wage but their wages are higher than the national average and higher than their competitors. Why?

People are losing their jobs all over the country, getting cut wages, or being asked to cut back hours. Many of them make way less than $28.75 an hour? Many college grads don't make $28.75 an hour. Some never will. Why should UAW be immune to the economic reality of being in a failing industry in a recession?

My last $0.02. If GM fails then UAW workers will be making 0% so maybe a 15% paycut to ensure the survival of the industry isn't soo bad. If GM fails likely many will end up working in new Toyota & Honda plants at wages paid there. Closing the gap between foreign and domestic labor needs to happen or GM will fail.

[sendero]

22. Exactly...

... the UAW have two choices: make less or make nothing. In a perfect world, the execs would understand that the same strictures apply to them also.

[SoCalDem]

17. The parent company is Japanese/German

so the overall structure includes the benefit of NOT HAVING TO PAY for health care/retirement for MOST of their employees( back home in their country)..

Their American ventures are SUBSIDIZED by the various locales/states where they open up their "outpost factories"..(much like WE did with the maquillidoras in Mexico).. They only have to offer wages high enough to attract a labor force, and maintain it long enough to punish/eliminate their competitors (GM-FORD-CHRYSLER)..Once the Big3 are gone-baby-gone, watch the wages of the "foreign" companies to fall...

[fascisthunter]

27. You got it....

[Canuckistanian]

23. If it's a highly industrialized country, they have government-paid healthcare

Oops, all except for America.

My mistake.

[fascisthunter]

28. and therein is the problem. We need government-paid healthcare

[fascisthunter]

26. excellent

DUers get the point

[area51]

29. From watching "Sick around the world", I believe they do.

link here to PBS Frontline special on healthcare systems around the world.