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Three stories making news across the Midwest today:

1. Big Three sales rise. Detroit automakers posted gains in annual sales Tuesday, although some leaps were not as large as anticipated. Chrysler showed the most significant improvement. Sales of its light vehicles rose 27 percent in October, year over year. Ford sales rose 6 percent overall and General Motors increased 1.7 percent, under expectations of a 5-to-7-percent increase. According to the Detroit Free Press, sales of the 2012 Ford Focus were largely unchanged over the year, but sales fell below the model’s chief competitor, the Chevrolet Cruze.

2. Pittsburgh seeks incoming residents. Upon winning $100,000, reality-show contestant Matt Kennedy Gould once dissed Disney World and proudly declared, “I’m going to Pittsburgh!” He’ll have some company. A promotional arm of the city is offering a $100,000 prize in a contest that aims to woo potential Pittsburgh residents. Officials seek what they call “experienced dreamers,” a euphemism for people 45 and older who are seeking a fresh start in a new city to “realize their dreams.” In New York City, the contest has some appeal. The blog Brokelyn notes, Pittsburgh boasts an unemployment rate below the national average and “the beer is really cheap.”

3. Toyota will export Siena. For the first time, Toyota will begin exporting the Siena from its U.S. assembly plant in Princeton, Ind. Shipments to South Korea are scheduled to begin in November. “We hope to continue boosting exports from our North American operations,” said Yoshimi Inaba, president of Toyota’s North American operations. In a written release, the company said it has exported several models of U.S.-made vehicles since 1988, and that overall, those exports increased 30 percent in 2010 to approximately 100,000 units. Sienna exports to South Korea are forecast at 600 annual units.


Three stories making news across the Midwest today:

1. Will two tiers vanish from auto contracts? One contentions round of contract negotiations just ended, Chrysler CEO Sergio Marchionne is already making bold predictions about what’s ahead when the current four-year contract ends. He said today that the automakers’ two-tier pay structure is not a viable one, and Chrysler and the UAW must find a way to merge two classes of workers next time. The structure is, “not something that can go on for a long period of time,” he said on a conference call to discuss the company’s second-quarter earnings. Marchionne continued, saying, two-tiers is “not a viable structure on which to build our industrial footprint.” Last month, Changing Gears reporter Kate Davidson examined the two-tiered wage structure and reported on its impact upon automakers and their workers.

2. Is Indianapolis jobs pledge a hoax? Only two short days ago, Indiana Gov. Mitch Daniels and Indianapolis Mayor Greg Ballard welcomed a California entrepreneur whose company would bring 1,100 jobs to the city. Two days later, there’s growing worry the company, Litebox Inc., and its owner Bob Yanagihara aren’t for real. The Indianapolis Star reviewed public documents that show Yanagihara owes “hundreds of thousands of dollars in state and federal tax liens” from the past decade, as well as money to investors who have sued him – and won. “I would strongly advise anyone thinking of investing in his projects to think twice,” Colin McGrath, who is owed $145,000, tells the newspaper.

3. Whirlpool will lay off 5,000 workers. Appliance manufacturer Whirlpool said Friday that it would eliminate 5,000 jobs across North America and Europe. The Benton Harbor, Mich.-based company cut its earnings forecast. Whirlpool CEO Jeff Fettig said the cuts came amid weak demand and higher costs. The cuts include 1,200 salaried positions, and company officials said overall, the layoffs will save approximately $400 million. There was no immediate breakdown of how the cuts would affect Whirlpool’s Michigan workforce.

 


Hours after United Auto Workers members reached an unprecedented split decision on whether to ratify a new contract with Chrysler, UAW president Bob King told PBS NewsHour there was no conflict within his ranks.

Asked about frustration following the split vote, he told host Jeffrey Brown, “You want to make – I’m sorry, but you seem like you want to make a rift where I don’t think there’s a rift.”

Earlier Wednesday, the UAW reported that 54.8 percent of hourly workers had voted in favor of ratifying a new contract with Chrysler, but that 55.6 percent of skilled-trade workers had voted against it, resulting in a split decision for the first time ever.

Nonetheless, UAW leaders met following the final tabulations and declared the contract had been ratified.

If skilled-trade workers had voted against the contract because of changes that specifically affected only their work, the UAW would have tried to renegotiate that portion, King told the Detroit Free Press. But “it was overwhelmingly clear that the issues were economic issues and not skilled-trade issues,” he said.

That final decision ostensibly concluded perhaps the most bizarre labor negotiations in memory, which started with Chrysler CEO Sergio Marchionne publicly rebuking King in a written letter at the outset of negotiations.

And they included an unusual priority. In the past, the UAW has placed a priority in negotiating for higher pay and better benefits. But this year, the UAW’s priority was gaining jobs. Toward that end, King secured contractual commitments from the Big Three that will add 20,400 jobs by 2015.

“The number one priority in this was to create jobs in America,” King told NewsHour. “So there will be a lot of people in a lot of communities around America that are hired into middle-class jobs because of what we did in this contract.”

 

 

 


Hours after United Auto Workers members reached an unprecedented split decision on whether to ratify a new contract with Chrysler, UAW president Bob King told PBS NewsHour there was no conflict within his ranks.

Asked about frustration following the split vote, he told host Jeffrey Brown, “You want to make – I’m sorry, but you seem like you want to make a rift where I don’t think there’s a rift.”

Earlier Wednesday, the UAW reported that 54.8 percent of hourly workers had voted in favor of ratifying a new contract with Chrysler, but that 55.6 percent of skilled-trade workers had voted against it, resulting in a split decision for the first time ever.

Nonetheless, UAW leaders met following the final tabulations and declared the contract had been ratified.

If skilled-trade workers had voted against the contract because of changes that specifically affected only their work, the UAW would have tried to renegotiate that portion, King told the Detroit Free Press. But “it was overwhelmingly clear that the issues were economic issues and not skilled-trade issues,” he said.

That final decision ostensibly concluded perhaps the most bizarre labor negotiations in memory, which started with Chrysler CEO Sergio Marchionne publicly rebuking King in a written letter at the outset of negotiations.

And they included an unusual priority. In the past, the UAW has placed a priority in negotiating for higher pay and better benefits. But this year, the UAW’s priority was gaining jobs. Toward that end, King secured contractual commitments from the Big Three that will add 20,400 jobs by 2015.

“The number one priority in this was to create jobs in America,” King told NewsHour. “So there will be a lot of people in a lot of communities around America that are hired into middle-class jobs because of what we did in this contract.”

 

 

 


Three stories making news across the Midwest today:

1. Sales up at Ford, forecast down. Ford’s third-quarter sales rose 14.1 percent year over year to $33.1 billion, the company said Wednesday morning. But the automaker’s global production plan of 1.37 million vehicles is below the 1.44 million anticipated by analysts, and investors had sold off Ford shares in morning trading, according to the Detroit Free Press. The gap came as a result of “a lower outlook in South America, Asia Pacific and Europe,” Morgan Stanley analyst Adam Jonas wrote.

2. Cook County plans layoffs. Cook County executives unveiled a budget that called for more than 1,000 layoffs to help narrow a projected $315 million deficit, according to our partner station WBEZ. Saying “there’s been nothing easy about this,” board president Toni Preckwinkle said hospital funding and the county’s jail population would be reduced in additional savings measures. She is also trying to convince the county’s union workers to accept furloughs to save $40 million instead of layoffs.

3. Wisconsin public employee pay freeze ahead? Wisconsin state employees may face a pay freeze over the next two years if lawmakers support a proposal from Gov. Scott Walker. The new proposal comes months after Walker required public workers to pay more for their pensions and health insurance while also eliminating almost all collective bargaining. The Milwaukee Journal Sentinel reports another change in the proposed legislation would award overtime only for actual hours worked, after a newspaper investigation revealed how prison guards gamed the overtime system to boost their pay.

 


While voting will not be complete until the end of the day, it appears members of the United Auto Workers will ratify a new agreement with Chrysler.

Workers at key plants in Sterling Heights, Mich., Dundee, Mich. and Toledo, Ohio have all passed the tentative contract within the last day on percentages that range from 53 to 80 percent. Voting has not yet concluded at Chrysler’s truck plant in Warren, which is considered a bellwether.

Even if Warren workers reject the contract, it may still have enough support elsewhere to pass overall, according to the Detroit News.

Unlike previous negotiations with Ford and General Motors, the UAW has not made the overall voting tallies public during Chrysler voting.

The Chrysler contract has widely expected to be the most difficult to pass of the three, because workers were offered signing bonuses of only $1,750 up front, with another $1,750 due later if the company met certain financial targets.

By comparison, Ford workers received a $6,000 signing bonus and General Motors employees received a $5,000 bonus.

But Chrysler lost $254 million in the first half of 2011, per the Detroit Free Press, while GM earned a profit of $5.7 billion and Ford earned a profit of $4.9 billion.


Three stories making news across the Midwest today:

1. Ford deal official. In a final tally, the United Auto Workers announced today that 63 percent of production workers and 65 percent of skilled-trade workers voted in favor of ratifying a four-year contract with Ford. “I believe UAW Ford workers understood the importance of each and every vote,” UAW Vice President Jimmy Settles said in a written statement. Earlier this month, UAW workers approved a new contract with General Motors by similar margins. Chrysler is the only Big Three automaker without a new contract, although voting began Tuesday on a tentative agreement.

2. Great Lakes crucial to economy. Cargo shipping throughout the Great Lakes supports 227,000 jobs and channels billions into the U.S. and Canadian economies, according to a report released Tuesday. “This report bears out what we’ve long known – that the Great Lakes-St. Lawrence Seaway is crucial to the U.S. economy,” U.S. Transportation Secretary Ray LaHood told WBEZ, our partner station. In July, Changing Gears reporter Kate Davidson examined the economic impact of Great Lakes shipping – and found a dredging backlog threatened to cripple the regional shipping industry.

3. Milwaukee lakefront plan unveiled. An “ambitious” plan to redevelop Milwaukee’s lakefront was unveiled Tuesday at a public hearing,calling for better pedestrian access to waterfront attractions and room for several blocks of development. The plan, submitted by Milwaukee County’s Long-Range Lakefront Planning Committee, endorsed tearing down freeway ramps, terracing O’Donnell Park and bulldozing the Downtown Transit Center, according to the Milwaukee Journal Sentinel. “Let’s take downtown and take it to the lake and vice versa,” Parks Director Sue Black said of the pedestrian portion of the plan.


Memorabilia from the now defunct AutoWorld in Flint

History is full of the search for magic bullets, those quick tickets to jobs and economic prosperity. Cities across our region have put great hopes and resources into magic bullets.  Some have soared; many have backfired. This week, we’re bringing you stories of magic bullets past and present. We start with this look back.

Magic bullets are kind of like imaginary friends. We all have them in our past, but most people deny they exist. Just turn on the TV these days and you’ll hear a list of things that aren’t magic bullets: fiscal stimulus, inflation, tax credits, etc, etc…

But then ask George Bacalis.

“There was a magic bullet when I was young and they called it an automobile,” he says.

Bacalis is 80, born in Detroit. He remembers a city crazy for cars in the 1950s.  Since then, the auto boom town has lost a million people, more than half its population. So can magic bullets work?

“Yeah, sometimes they work,” says historian Kevin Boyle. “But it’s a rare thing and it has consequences as Detroit today I think really shows.”

Boyle is a history professor at The Ohio State University and the author of Arc of Justice, about 1920s Detroit. He agreed to help us run through a very abridged history of the Midwest magic bullet.

Magic bullet number one: A city or town finds that one key industry on which it tries to build a whole economy.

“So Detroit had its auto industry; Akron had the tire industry; Sheboygan had toilet production,” Boyle says. He says the problem is the Midwest grew a lot of single industry towns that were hit hard when that first magic bullet failed them. Think Youngstown or Muncie.

“And so you get a certain desperation,” Boyle says, “to try to find the way back to where we once were.”

Which can lead to magic bullet number two (this one is our nomination): “If you build it, they will come.”

On July 4, 1984, Michigan’s then governor James Blanchard declared, “Today…is the first day of the rebirth of the great city of Flint.”

He was announcing the opening of AutoWorld, an ill-fated $80 million theme park in the birthplace of GM.  Some touted it as the world’s largest indoor theme park. But attendance lagged and it seemed AutoWorld couldn’t decide what it wanted to be: a thrilling amusement park or an homage to the car. AutoWorld closed months later, reopened briefly, then ended up a punch line in a Michael Moore film. It was demolished in 1997.

Then there’s magic bullet number three: the great event.

In 1893, Chicago hosted, literally, the greatest show on earth: the world’s fair.  It built a gleaming white city within the real city of slaughterhouses and industrial grime. The world’s first Ferris wheel spun 2,000 passengers at a time. But in 1893, financial panic seized the nation. Workers marched in the streets. Historian Kevin Boyle says no single event, no matter how glorious, could offset the soaring unemployment of the downturn that followed.

More than a century later, former mayor Richard Daley lobbied hard for a Chicago Olympics.

“The 2016 Olympic Games will grow our economy,” he proclaimed, “Create hundreds of thousands of jobs.  Generate billions in new economic activity. The impact will be enormous and most of it will be concentrated in Chicago neighborhoods.”

Or, in Rio neighborhoods.  Despite at least an $80 million bid, Chicago lost the games to Brazil in 2009. If it’s any consolation, Rob Livingstone of GamesBids.com says Detroit tried for years to get the games. The city bid for 1944, 1952, then 1956, 1960, 1964, 1968 and 1972.  A lot of bids, no

“It is a lot of bids,” says Livingstone. “It’s not uncommon, but I think they actually do have the record for the most consecutive unsuccessful bids.”

Historian Kevin Boyle points to one last magic bullet, maybe the most complex.  Urban renewal: the massive postwar effort to transform cities by eliminating blighted housing and building public housing for the poor. Boyle says the poorest neighborhoods in America were desperately poor and did need revitalization.  But too often, he says, urban renewal simply devastated black neighborhoods and the communities within them.

“It took all of old Black Bottom away,” says Reverend Horace Sheffield III of Detroit. “The freeways were built through the heart of black businesses. Gotham Hotel and Hastings Street.  I mean, all of that was lost.”

Vibrant Hastings Street once hosted the great musicians of the day: Duke Ellington, Billie Holiday, Dinah Washington, Sarah Vaughan and more. It’s where Alberta Adams, Detroit’s “Queen of the Blues” got her start. Today, it’s a stretch of the Chrysler Freeway.

There’s nothing simple about so-called magic bullets.  But it’s also a city’s job to constantly look for ways to improve the lives of its people. So what are the magic bullets of today and tomorrow?  We turn to those next and we want to hear from YOU as well. Please leave your nominations below.


The mood of several workers at Ford’s engine plant in Brook Park, Ohio, sums up the mixed feelings of the company’s workers nationwide: In a tentative contract agreement Ford struck with the United Auto Workers union last week, workers feel they’re not getting enough back to compensate for concessions in previous contracts.

The contract is faltering in early voting across the country, with 54.6 percent of voters so far rejecting the deal. Thursday afternoon, the UAW Ford Department said 3,256 workers had voted yes and 3,915 had voted no. Voting on the four-year deal is expected to end Tuesday.

Results from the Cleveland-area Brook Park plant were not yet known, but an early survey of workers showed results titled against the deal, and anger toward bonuses given to executives had risen.

“I gave up $20,000 a year,” between a lack of raises and moving from skilled trades to production,” Erich Ockuly, a Brook Park worker, told The Plain Dealer. “All that so Alan Mulally could make $24 million.”

Elsewhere, employees at a Chicago Ford plant overwhelmingly rejected the contract. UAW Local 551 reported Thursday morning that 77 percent of 2,317 votes cast went against the agreement, which offered a $6,000 signing bonus but no cost-of-living adjustment. Chicago Mayor Rahm Emanuel has endorsed the contract, saying it would create 1,100 new jobs in Chicago, according to our partner station WBEZ.

In Detroit, voting was more mixed. Sixty-six percent of production workers and 64.5 percent of skilled-trade workers voted yes on the deal, according to UAW Local 228, which represents 1,740 hourly employees at Ford’s axle plant in Sterling Heights. Earlier this week, Ford workers at a stamping plant in Wayne, as 51.5 percent rejected the contract, according to the Detroit Free Press.

Changing Gears senior editor Micki Maynard discussed the flagging support of the Ford contract during a Wednesday evening appearance on PBS NewsHour.

“The Ford workers, I think they feel they deserve more,” she said. “Their company didn’t take a federal bailout, and it really isn’t in bad shape at all. It’s in the most profitable position of any of the car companies.”

That is reflected in the contract agreement: Ford workers are faced with a better deal than their counterparts at General Motors and Chrysler. Ford workers would receive a $6,000 signing bonus, while GM workers will receive a $5,000 bonus; Chrysler workers would receive $1,750 upon ratification and $1,750 after the company hits certain financial targets.

(Here’s a handy chart that compares the basics of the three UAW contracts, courtesy of the Free Press).

If Ford workers reject the contract Tuesday, the company could lock out workers, the union could strike or the two sides could return to the negotiating table.


Three stories making news across the Midwest today:

1. Midwest counties lead nation. Several counties in the Midwest are among the country’s biggest beneficiaries of increased employment and wages, according to new data released from the U.S. Bureau of Labor Statistics. Elkhart County in northern Indiana had the largest percentage increase in employment from March 2010 to March 2011 among the nation’s largest 322 counties, growing its workforce by 6.2 percent. Indiana’s overall employment increased 1.9 percent in the same time span. The next-largest increase belonged to Ottawa County in western Michigan, which grew at 4.7 percent. Peoria County, Illinois showed the largest year-over-year increase in average weekly wages, with a gain of 18.9 percent.

2. Illinois seeks Amazon taxes. Amazon.com has agreed to pay sales taxes in California. Officials are hoping that deal means the online retailer will agree to do the same in Illinois, according to a report in Crain’s Chicago Business today. The Illinois Retail Merchants Association has sent Amazon CEO Jeff Bezos a letter, saying “the tide is turning” and encourages the company to begin collecting Illinois sales tax immediately. Under the California agreement, Amazon agreed to go to Washington D.C. and lobby for national legislation that regulates how internet retailers should be taxed.

3. Big Three post sales gains. Strong sales of trucks and sport utility vehicles buoyed Chrysler in September, when sales rose 27 percent. The automaker led an impressive month for Detroit’s Big Three. Despite a struggling economy, General Motors posted sales gains of 20 percent and Ford’s sales rose 9 percent. “There is no double dip downturn going on around here,” Dodge brand president and chief executive Reid Bigland told The Plain Dealer in Cleveland. At General Motors, the Chevrolet Cruze continued to be the company’s best-selling car, although the sales of the Lordstown, Ohio-built Cruze dipped below 20,000 units for the first time in five months.