• Guest, The rules for the P & N subforum have been updated to prohibit "ad hominem" or personal attacks against other posters. See the full details in the post "Politics and News Rules & Guidelines."

Caterpillar: Bulldozing the American Dream

Page 5 - Seeking answers? Join the AnandTech community: where nearly half-a-million members share solutions and discuss the latest tech.

Phokus

Lifer
Nov 20, 1999
22,995
774
126
I get it, but the difference is I'm okay with a natural market that isn't regulated by government, and you maybe want some sort of reform. I'm not sure if you are just complaining or would like to see government initiated change.
I want to see government initiate change. I want it to be like Germany where workers have 50% representation on the board.

Of course you're ok with the natural market, that's why we're fucked. I bet CEO's are tickled pink that such a significant portion of the population of 'little people' are rooting for them as they loot the companies that you and i have our retirements invested in.
 

momeNt

Diamond Member
Jan 26, 2011
9,297
350
126
I want to see government initiate change. I want it to be like Germany where workers have 50% representation on the board.

Of course you're ok with the natural market, that's why we're fucked. I bet CEO's are tickled pink that such a significant portion of the population of 'little people' are rooting for them as they loot the companies that you and i have our retirements invested in.
My retirement is in land and gold. CEOs can't loot that.
 

momeNt

Diamond Member
Jan 26, 2011
9,297
350
126
No, but investment banks who manipulate the gold market and real estate markets will. It's going to be funny when gold crashes again.
Just have to watch the market, cash out when the underlying fundamentals call for a crash, then buy back in. It'll be like the government is practically giving me money.
 

dainthomas

Lifer
Dec 7, 2004
13,906
2,215
126
Just because labor is likely to lose this time doesn't mean free unions are forbidden, and collective bargaining doesn't guarantee you always get what you want.
But you seem to be celebrating their downfall. And as many have said, what Cat is doing, given their level of profitability, is pretty f'ed up. The workers SHOULD stand up for themselves, since they're the ones creating the profit for the company.
 

Pulsar

Diamond Member
Mar 3, 2003
5,225
306
126
“A company that earned a record $4.9 billion in 2011 and $1.586 billion in the first quarter of this year should be willing to help the workers who made those profits for them,” said Timothy O’Brien, president of Machinists Local Lodge 851, which represents the strikers. “Caterpillar believes in helping the very rich, but what they’re doing would help eliminate the middle class.”

He said the company wants a pay and pension freeze for longtime workers to push them into retirement and replace them with $13-an-hour workers.
Dear Timothy O'Brien,

Kindly get your head out of your ass. The majority of Caterpillar profits are made overseas, where growth is high and labor costs are low. In fact, in 2012 60% more jobs were added overseas than in the US. Caterpillar forecasts the US and European economy to continue to be depressed, and Asian markets to continue to grow. Caterpillar has more overseas production facilities than in the US.

In short, you're acting as if you're due something. You're not. You are not making Caterpillar money. You are currently living on profits generated by overseas operations. Caterpillar believes in making money.

The plan to lower new worker's wages has already been negotiated and accepted across the auto industry. Welcome to reality.

That is all.
 

theevilsharpie

Platinum Member
Nov 2, 2009
2,322
14
81
The workers SHOULD stand up for themselves, since they're the ones creating the profit for the company.
This belief keeps being bandied around this thread as if it's an absolute truth.

It's not.

The engineer that redesigns an engine to make it lighter, less expensive, and more fuel efficient is going to make a hell of a lot more profit for CAT than a factory worker. The sales executive that negotiates a substantial sale to a large mining operation because of the more efficient engine makes a hell of a lot more profit for CAT than a factory worker. The PR coordinator that publicizes these sales wins in trade and business magazines, leading to an increase in the stock price, makes a hell of a lot more profit for CAT than a factory worker. The financier that uses their increased share price, AR, sales leads, and public goodwill to negotiate lower interest rates on bonds and notes make a hell of a lot more profit for CAT than a factory worker.

I think you get the idea. This romantic belief that factory workers are solely responsible for the profits CAT generates is laughable. Now, don't take this to mean that I think CAT's manufacturing process is worthless. It's not: without it, CAT can't do business. But just because the process is important, doesn't mean that its individual participants are. Line work in industrial manufacturing is highly routinized. The people performing it are essentially interchangeable cogs, and there are plenty of unemployed able-bodied workers that CAT can train and throw on the line if the existing workers leave, both specifically in the areas around CAT's factories, and generally throughout the world. Mechanical engineers? high-stakes salespeople? corporate financing managers? They aren't quite so easy to replace, hence why they can successfully demand a bigger cut of the profit.

Earlier in this thread, I asked a simple question: If CAT's factory workers don't think they're getting paid what they're worth, why don't they go work somewhere else? It's interesting how so many in this thread vilify CAT's senior management for "exploiting" their factory workers by daring to freeze their pay, yet these "champions of labor" seem to be doing their damnedest to avoid answering that very simple question.
 

ch33zw1z

Lifer
Nov 4, 2004
34,307
13,207
146
Nobody has suggested that the assembly line workers are solely responsible for the companies profitability, but maybe I missed it.

Actions such as this get outrage because the wages aren't being frozen across the board, and it's happening while profits are still meeting and surpassing expectations. If they really want to save money, freeze everyone's pay, including exec's.

Really, if those exec's, engineers, and sales reps don't like it then go find another job...same scenario.

Just because assembly line work may be highly "routinized" doesn't mean it's mindless labor. If monkey's could do the job, they'd hire monkeys. Like it or not, putting together machines takes knowledge and skill.

These situations aren't just happening at CAT, but other large employers in the USA who are reporting record profits while continuing to whittle down benefits and pay to the employees who are viewed as "at the bottom" of the totem pole if you will. The difference here is that these guys are union, while other employers are not.
 
Last edited:

theevilsharpie

Platinum Member
Nov 2, 2009
2,322
14
81
Nobody has suggested that the assembly line workers are solely responsible for the companies profitability, but maybe I missed it.
Is anyone in this thread literally saying that line workers are solely responsible for the profit of today's corporations? No. However, statements such as:
So it's ok to have overpaid senior management when profits are huge and forecasted to be huge, but it's not ok to even maintain current levels of pay for the people who contributed most to building the profitable products when profits are huge and forecasted to be hudge? (which would not have impacted their huge profits any bit).
Stating a production job is more productive than someone sitting on their ass all day is not me looking on anyone, it's just a fact. Their job is to produce heavy machinery. You cannot be much more productive than that...
I did not say the majority of Americans are unskilled, just that they are less productive than someone working at a production plant producing heavy machinery. You have a warped egotism fueled by your belief that sitting at a desk all day is somehow exponentially more productive than a person who actually works.
But you seem to be celebrating their downfall. And as many have said, what Cat is doing, given their level of profitability, is pretty f'ed up. The workers SHOULD stand up for themselves, since they're the ones creating the profit for the company.

...certainly imply it.

Actions such as this get outrage because the wages aren't being frozen across the board, and it's happening while profits are still meeting and surpassing expectations. If they really want to save money, freeze everyone's pay, including exec's.

Really, if those exec's, engineers, and sales reps don't like it then go find another job...same scenario.
Part of the reason why CAT isn't freezing the pay of senior execs, engineers, sales reps, and other similar roles is because workers in those roles can easily find another job. If CAT doesn't pay at least the market rate, they risk substantially disrupting their operation.

With respect to CAT's factory workers, CAT clearly believes their wage demands are above market rates, and are freezing them accordingly. Time will tell if their belief is correct, but given their past history and the current economy, I wouldn't bet on the workers.

Just because assembly line work may be highly "routinized" doesn't mean it's mindless labor. If monkey's could do the job, they'd hire monkeys. Like it or not, putting together machines takes knowledge and skill.
Factory work is absolutely mindless. When I say that, I don't mean to imply that the workers are stupid, but that the nature of factory work is such that workers are required to follow instructions for their role without deviation. This eliminates opportunities for a single worker to differentiate his or her skills and abilities from the thousands of other workers in that same role, and allows the factory to replace existing workers as needed. The end result: an environment where workers have little leverage to demand pay increases. The fact that many of these workers are unable to "walk away" from their job due to excessive financial obligations only serves to decrease their bargaining power.
 

Jhhnn

No Lifer
Nov 11, 1999
62,364
14,616
136
This belief keeps being bandied around this thread as if it's an absolute truth.

It's not.

The engineer that redesigns an engine to make it lighter, less expensive, and more fuel efficient is going to make a hell of a lot more profit for CAT than a factory worker. The sales executive that negotiates a substantial sale to a large mining operation because of the more efficient engine makes a hell of a lot more profit for CAT than a factory worker. The PR coordinator that publicizes these sales wins in trade and business magazines, leading to an increase in the stock price, makes a hell of a lot more profit for CAT than a factory worker. The financier that uses their increased share price, AR, sales leads, and public goodwill to negotiate lower interest rates on bonds and notes make a hell of a lot more profit for CAT than a factory worker.

I think you get the idea. This romantic belief that factory workers are solely responsible for the profits CAT generates is laughable. Now, don't take this to mean that I think CAT's manufacturing process is worthless. It's not: without it, CAT can't do business. But just because the process is important, doesn't mean that its individual participants are. Line work in industrial manufacturing is highly routinized. The people performing it are essentially interchangeable cogs, and there are plenty of unemployed able-bodied workers that CAT can train and throw on the line if the existing workers leave, both specifically in the areas around CAT's factories, and generally throughout the world. Mechanical engineers? high-stakes salespeople? corporate financing managers? They aren't quite so easy to replace, hence why they can successfully demand a bigger cut of the profit.

Earlier in this thread, I asked a simple question: If CAT's factory workers don't think they're getting paid what they're worth, why don't they go work somewhere else? It's interesting how so many in this thread vilify CAT's senior management for "exploiting" their factory workers by daring to freeze their pay, yet these "champions of labor" seem to be doing their damnedest to avoid answering that very simple question.
None of which justifies changes in the distribution of pie shares over the last 30 years. It's not like execs are many times more hard working or intelligent than they were 30 years ago relative to their underlings, is it? If workers need to compete with foreign labor, why don't execs? Obviously, there are lots of extremely capable Indian and Chinese execs who'd do it for a lot less.

We also need to recognize the circular nature of Cat's wage argument & the ever downward trajectory it represents for workers. If Cat pays less over time, which is the whole point, then other employers will use the same argument to do the same. Cat will then make the same claim 6 years down the road. The notion that Cat will raise wages at the same time for lower paid employees is dishonest promise posturing, at best. They'll only raise wages when obligated to do so.

I think we all need to recognize that a 6 year pay freeze is an excessively long time, and that the issues are more complex than that. The pension freeze is more than represented, actually an abandonment of pensions for junior employees, while increased employee contributions for healthcare are also a factor.
 

Pr0d1gy

Diamond Member
Jan 30, 2005
7,775
0
76
Obviously, there are lots of extremely capable Indian and Chinese execs who'd do it for a lot less.

And they would do it better because I know the average Chinese CEO, especially, is smarter than 95% of all of the American CEO's.
 

techs

Lifer
Sep 26, 2000
28,561
3
0
Interesting, interesting.
The righties are now arguing that making Caterpillar products successful is a team effort. That it couldn't have been done by just the workers. It took engineers, pr guys, etc.

Which is exactly what Obama was talking about.
 

Pr0d1gy

Diamond Member
Jan 30, 2005
7,775
0
76
Interesting, interesting.
The righties are now arguing that making Caterpillar products successful is a team effort. That it couldn't have been done by just the workers. It took engineers, pr guys, etc.

Which is exactly what Obama was talking about.
That is their game, argue a point when they think Americans will become offended and rally to their aid until something comes up where they need to make the same argument...then they just flip to the other side.

It's pathetic.
 

theevilsharpie

Platinum Member
Nov 2, 2009
2,322
14
81
None of which justifies changes in the distribution of pie shares over the last 30 years. It's not like execs are many times more hard working or intelligent than they were 30 years ago relative to their underlings, is it?
The market apparently believes that they are, and given the general trend of centralized automation in which top people have more and more control over the details of how a process is executed, that belief is not entirely unfounded.

If workers need to compete with foreign labor, why don't execs? Obviously, there are lots of extremely capable Indian and Chinese execs who'd do it for a lot less.
There is a world of business outside the Fortunate 500. There are thousands upon thousands small and medium businesses in America, and more than a few have failed due to competitive pressures from India and China. Executives aren't immune, particularly in companies that don't have an international presence.

We also need to recognize the circular nature of Cat's wage argument & the ever downward trajectory it represents for workers. If Cat pays less over time, which is the whole point, then other employers will use the same argument to do the same. Cat will then make the same claim 6 years down the road.
The "downward trajectory" will level off at some point. Workers aren't going to stay if they can get the same pay at a less strenuous job, and if an excessive number of workers leave the industry, manufacturers will start competing for the remaining workers by raising pay. CAT's factory workers do have a market value; it's probably just a lot lower than what they're currently being paid.

The notion that Cat will raise wages at the same time for lower paid employees is dishonest promise posturing, at best. They'll only raise wages when obligated to do so.
Welcome to Capitalism.
 

rayfieldclement

Senior member
Apr 12, 2012
514
0
0
You idiots seem to think caterpillar should have just done the same as detroit, just sit on their butts overpaying their workers, until they reach the point where they are no longer competitive and they're in a big mess and need a bailout.

It's a competitive market, the company is doing what it should to keep their expenses in check, just like the workers and their union try to increase their wages. Just because the company is making a profit doesn't mean it shouldn't do everything it can to maintain the competitive edge they have.

Caterpillar should just move their HQ out of illinois to a state with better leadership and do even better.

Are they being "competitive" with the Managers salary? How come when some corporation want to be competitive it is the non managers salary that goes down or somewhere else. They have major profits. Good riddence if they go under.
 

Jhhnn

No Lifer
Nov 11, 1999
62,364
14,616
136
The market apparently believes that they are, and given the general trend of centralized automation in which top people have more and more control over the details of how a process is executed, that belief is not entirely unfounded.
And the "Market", the sacred free market, believes that Wall St execs, Hedge fund & PE financial manipulators should be the best paid of all, along with Walmart heirs. Perhaps th "flaw", as Greenspan put it, isn't with workers but with the system created by manipulators.

There is a world of business outside the Fortunate 500. There are thousands upon thousands small and medium businesses in America, and more than a few have failed due to competitive pressures from India and China. Executives aren't immune, particularly in companies that don't have an international presence.
Which has exactly what to do with Cat execs?

The "downward trajectory" will level off at some point. Workers aren't going to stay if they can get the same pay at a less strenuous job, and if an excessive number of workers leave the industry, manufacturers will start competing for the remaining workers by raising pay. CAT's factory workers do have a market value; it's probably just a lot lower than what they're currently being paid.
Nice to see that your denial isn't total. Will this downward trend level off at something above the third world, at a level that will sustain our infrastructure & the American middle class, or are we just as disposable as Indian ship scrappers, who are blind before the age of 40? Why, in this near perfect Capitalist utopia being built by the Rightwing, will it level off at any higher level other than for political reasons? Why shouldn't citizens in a Democracy place limits on what the power of wealth can encompass?

Perhaps we should just revert to the ancien regime, where the peasants paid taxes for the purpose of supporting the lifestyles of their betters, those of royal blood...
 

PokerGuy

Lifer
Jul 2, 2005
13,650
199
101
"Where free unions and collective bargaining are forbidden, freedom is lost." --Ronald Reagan
I don't see anything here about free unions being forbidden. They are free to form a union and try to collectively bargain, that doesn't mean they get whatever they want.
 

PokerGuy

Lifer
Jul 2, 2005
13,650
199
101
Are they being "competitive" with the Managers salary? How come when some corporation want to be competitive it is the non managers salary that goes down or somewhere else. They have major profits. Good riddence if they go under.
Do you have any evidence to indicate that they are paying their managers too much? Competitive pay means they pay at least the same amount in total compensation as other comparable employers for comparable jobs. If the workers think they are underpaid (as many in this thread seem to think they are), then they are free to go work somewhere else and get paid more. In fact they are likely way overpaid for the type of work they do compared to other people doing the same job in that area, and thus they have no viable alternatives at this point.
 

Jhhnn

No Lifer
Nov 11, 1999
62,364
14,616
136
Do you have any evidence to indicate that they are paying their managers too much? Competitive pay means they pay at least the same amount in total compensation as other comparable employers for comparable jobs. If the workers think they are underpaid (as many in this thread seem to think they are), then they are free to go work somewhere else and get paid more. In fact they are likely way overpaid for the type of work they do compared to other people doing the same job in that area, and thus they have no viable alternatives at this point.
Heh. "they are free to go work somewhere else and get paid more" sounds peachy, and is the usual right wing deflection.

You ignore the trend, the trend of America becoming one giant company town where workers are bound to their employers by debt. Not directly anymore, but indirectly by high overhead, underwater mortgages & very low/ negative net worth. It's kinda like telling galley slaves that they're free to go when there's no land in sight.

Only the fact that Union employees make a little more gives them the ability to get uppity, lead wages in an upward rather than downward direction. Which is, of course, the reason that Cat & the rest want to break their balls off.
 

PokerGuy

Lifer
Jul 2, 2005
13,650
199
101
where workers are bound to their employers by debt <snip> indirectly by high overhead, underwater mortgages & very low/ negative net worth.
I wasn't aware that the employer is now responsible for how people spend their money and whether they incur debt or not. Somehow you also think the employer is responsible for underwater mortgages and low/negative net worth. Funny world view you got there. :D
 

IndyColtsFan

Lifer
Sep 22, 2007
33,619
644
126
I remember hearing a story about one of my workplaces before I worked there. The management did the usual "you're lucky to be working here and have a job" song and dance and then cut benefits. It later came out that the President of the company got a raise which was more than the entire cost of the reduced benefits.

Management at most companies just doesn't have a clue. I think that's the moral of the story.
 
Last edited:

rayfieldclement

Senior member
Apr 12, 2012
514
0
0
Do you have any evidence to indicate that they are paying their managers too much? Competitive pay means they pay at least the same amount in total compensation as other comparable employers for comparable jobs. If the workers think they are underpaid (as many in this thread seem to think they are), then they are free to go work somewhere else and get paid more. In fact they are likely way overpaid for the type of work they do compared to other people doing the same job in that area, and thus they have no viable alternatives at this point.
That was MY mistake. In the original post The executives are getting paid well (second paragraph)and the workers
 

ASK THE COMMUNITY