Oct 6, 2008
A “VEBA” retiree health-care fund was set up as part of the UAW’s 2007 contracts with GM, Ford, and Chrysler. The fund is to be run by the UAW and is supposed to take over responsibility for retiree healthcare. In return, the auto companies were supposed to contribute funds in 2008, 2009 and 2010.
This risky deal was sold to UAW workers as a smart move in case the auto companies ran into financial trouble.
Well the companies are in financial trouble and what happened? In July, GM said it would not make the payments it had promised for 2008 and 2009. UAW leaders put lipstick on this pig, saying they considered it a “loan” to GM at 9% interest.
Now in September, a UAW vice-president told reporters that they would “do the right thing” and work with GM if GM didn’t want to pay the money it owes for 2010!
The UAW told workers that the VEBA would be “good for 80 years.” Evidently even 80 weeks was too much to ask!