| The solution to the globalization crisis in the developed world is not for labor to concede to wage, insurance and pension cuts, but rather for management to reform itself so that it is nimble enough to respond quickly to the changing demands of the marketplace. |
| The failure of American (and some European) corporations to compete with the developing world in the manufacturing sector is not solely a result of legacy pension costs and high wages. It is also the result of a lack of imagination and of an ability to respond to changes in the marketplace by management. One example of this is the recent response by auto consumers to the rising price of gasoline. Consumers are turning away from gas guzzling SUVs and towards more fuel-efficient cars like hybrids. However, American manufacturers have been slow to adjust. Just as in the 1970s (when this same phenomenon occurred) foreign competitors are racing to monopolize the market with products that consumers want. All of this is no fault of the workers on the shop floor, who build whatever type of vehicle management dictates that they produce. One element of a solution to this problem might be to tie executive pensions and retirement compensation packages to company pension funds. If the pension funds are under funded, executive pensions should be in jeopardy along with worker pensions. If a government bailout of a corporation's pension fund is required, executive pensions should be subject to the same federal regulations and limitations as worker pensions. This might encourage corporate executives to see to it that pension funds are adequately funded, rather than frittering them away and counting on a government bailout later. |
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