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> Right now United Auto Workers is asking for a 45% pay increase and working 32 hour weeks while getting paid for 40 hours (which is an additional 25% boost (th

> Right now United Auto Workers is asking for a 45% pay increase and working 32 hour weeks while getting paid for 40 hours (which is an additional 25% boost (they are certainly not going to produce 40 hours of work in 32 hours). And more. > This represents a complete disconnect from reality. This kind of thing leads to outsourcing, automation and job loss. Entire industries have already been decimated by this kind of thing. Do you know what the profit of Ford was for 2022? [1] 23 billion dollars. And how many people does Ford employ? [2] 173,000. That's $132,000 available for ford to pay each of their employees on top of salary they already paid. Do you know how long it takes UAW's wage increase to take effect? [3] 4 years. (or roughly a 10% increase in pay each year). Do you know what the ultimate max salary asked for is? [3] $47/hr or $75k/year So you are saying a company that made enough profit (that is, revenue - expense, which includes employee wages) to give each of their employees a lump $132,000 bonus in 2022 couldn't afford 10% salary increases for the same employees over 4 years? You should really sit down and do the math on this stuff. There's monied interest by car manufactures to paint this as uncharitably as possible. So of course you are going to see articles where these poor multi-billion dollar companies are just scraping by... with record profits. [1] https://www.macrotrends.net/stocks/charts/F/ford-motor/gross-profit https://www.macrotrends.net/stocks/charts/F/ford-motor/gross... [2] https://www.macrotrends.net/stocks/charts/F/ford-motor/number-of-employees https://www.macrotrends.net/stocks/charts/F/ford-motor/numbe... [3] https://abcnews.go.com/Business/day-workweek-46-raise-uaw-makes-audacious-demands/story?id=102926195 https://abcnews.go.com/Business/day-workweek-46-raise-uaw-ma...

constantly 3y ago
Thanks for posting this. I was content to downvote and move on, but I think you did a good job here. A lot of what the post said is pretty handwavey and leaves out key details to the point of basically becoming FUD at worst, or charitably someone who has only a very superficial understanding of these things through a lack of doing any critical research on the topic. You only hit on a couple of their points, but I note that all the rest of them at a glance are subject to the same sort of deficiency from critical analysis and factual sources.
- lotsofpulp 3y ago
  Their premise is false, and when called out on it, they resorted to claiming the official numbers are fraudulent, with no source. Even though they chose an “official” number themselves as the premise for their argument.
  - cogman10 3y ago
    Cite where I said the numbers are fraudulent.
    - lotsofpulp 3y ago
      That is what “Hollywood accounting” would be if it were subject to regulators. https://news.ycombinator.com/item?id=37398156 https://news.ycombinator.com/item?id=37398156
      - cogman10 3y ago
        Do you think Hollywood is not subject to regulators? Does Disney file a 10-K? Has star wars made a profit? I'd suggest reading the linked wikipedia article first to understand what hollywood accounting actually is. It is neither illegal nor fraudulent. It is arguably immoral, but we aren't talking about morals in this thread. I'll assume you simply don't know what the term Hollywood accounting actually means and that's why you thought I was saying Ford committed fraud.
        lotsofpulp 3y ago
        > Does Disney file a 10-K? Yes, and they are not required to breakdown financial figures for each movie they make. > It is neither illegal nor fraudulent. Because it is not subject to regulations, it is specifically designed to screw various vendors in the movie business, without violating any business agreements (or skirting the line so that it is not worth the counterparty to file a lawsuit). If Disney did try to submit a 10-K with the same calculations they do for their “Hollywood accounting”, it would be illegal. The key point in the Hollywood accounting Wikipedia write up is: > Because of the studio's ability to place arbitrary charges along the value chain, net participation "points" (a percentage of the net income as opposed to a percentage of the gross income of a film) are sometimes referred to as "monkey points". The term is attributed to Eddie Murphy, who is said to have also stated that only a fool would accept net points in their contract. This is all irrelevant for SEC filings, since those have to include ALL ins and outs of the business. If a Disney CEO tried to screw investors by artificially lowering net income and reducing the investors’ profit, heads would roll. This is ignoring the basic fact that CEO and other company executives are compensated in shares in the first place, which means they want net income to be high so that the share price goes higher.
notdarkyet 3y ago
That Ford 23 billion number you are citing is Gross Profit, not NET This number ignores expenses that are not involved with the product and cost of goods sold. https://www.investopedia.com/terms/g/grossprofit.asp#toc-gross-profit-vs-net-income https://www.investopedia.com/terms/g/grossprofit.asp#toc-gro... https://finance.yahoo.com/quote/F/financials?p=F https://finance.yahoo.com/quote/F/financials?p=F "You should really sit down and do the math on this stuff." Before coming in hot with numbers and firing back I would check what you are saying first.
- cogman10 3y ago
  Perhaps consider Hollywood accounting [1] before being concerned with net income. Suffice it to say, it's within ford's best interest to often report negative or near negative net profits. That's how you reduce your tax burden. It's super easy for a company to make up additional overhead above and beyond gross profits to disappear everything. (including money spent on stock buybacks, dividend payments, and CEO perks). A company that has 23 billion in gross profits and -2 billion net income isn't what you think it's saying. [1] https://en.wikipedia.org/wiki/Hollywood_accounting https://en.wikipedia.org/wiki/Hollywood_accounting
  - lotsofpulp 3y ago
    If you are equating unregulated Hollywood accounting to SEC regulated 10-K filings, then either you need more education, or you distrust the system so much that conversing would be pointless. And businesses cannot reduce net income by the amount of dividends or stock buybacks, for obvious reasons.
    - cogman10 3y ago
      > If you are equating unregulated Hollywood accounting to SEC regulated 10-K filings, then either you need more education Are you saying it wouldn't be advantageous to claim an easily recoverable loss which both makes your shareholders happy and reduces your tax burdens not only for the current year but future years (because you can defer losses)? Hollywood accounting is orthogonal to the concept of a 10-k. The numbers are "real" but they are also VERY easy to manipulate (IE, doing a stock buyback). I'd suggest considering the case study of sears. Where somehow a public company went bankrupt yet the owner ended up with billions of dollars and... the company.. again.. somehow. [1] That is hollywood accounting in it's full action and all perfectly lined up for 10-ks (after all, AFAIK the SEC never stepped in here to give Lampart so much of a slap on the wrist). I'm not saying that Ford or others are anywhere near as bad as what happened to Sears/Kmart. I am saying that the same system Ford operates in, sears operates in. [1] https://www.investopedia.com/news/downfall-of-sears/ https://www.investopedia.com/news/downfall-of-sears/
motles 3y ago
Uh. 23 billion was the gross profit 12 billion operating income -1.9 billion net income Ie they lost money in 2022 when all was said and done. Also no company that has taken outside money from investors can just give their profits to employees and not share the profits back to the investors. No investor would ever give money to a company where their share of the profits - which they were duly owed because they took a risk and put money into an enterprise - is not returned to them - and instead shared to employees because it’s the righteous thing to do. No CEO or CFO would keep their jobs for long if they did this. That’s just not how capitalism works.
- PaulDavisThe1st 3y ago
  This is just such a ridiculously limited view of how investment can work and what capitalism is. Tons of investors give money to companies without any realistic expectation of ever receiving any profits - they believe that the value of the stock they own will increase in the judgement other future stock owners. That's the only reason Amazon was able to receive capital investment for more than a decade. Workers also take a risk in choosing to go work for a company, and frequently it is a bigger risk than the one taken by capital owners. The latter will rarely invest in a way that puts their lifestyle on the line, whereas that's all the former can do. There are pros and cons of the capitalist system, but it does neither capitalism nor us humans any service to present this sort of childish 10th grade view of what it is and how it works (or doesn't).
AnimalMuppet 3y ago
You need to re-do your math. In addition to what others have said, if they start paying 40 hours pay for 32 hours work, they're going to have to hire 25% more people to produce the same number of cars - that is, to reach the same income.

constantly 3y ago

Thanks for posting this. I was content to downvote and move on, but I think you did a good job here. A lot of what the post said is pretty handwavey and leaves out key details to the point of basically becoming FUD at worst, or charitably someone who has only a very superficial understanding of these things through a lack of doing any critical research on the topic. You only hit on a couple of their points, but I note that all the rest of them at a glance are subject to the same sort of deficiency from critical analysis and factual sources.

lotsofpulp 3y ago
Their premise is false, and when called out on it, they resorted to claiming the official numbers are fraudulent, with no source. Even though they chose an “official” number themselves as the premise for their argument.
- cogman10 3y ago
  Cite where I said the numbers are fraudulent.
  - lotsofpulp 3y ago
    That is what “Hollywood accounting” would be if it were subject to regulators. https://news.ycombinator.com/item?id=37398156 https://news.ycombinator.com/item?id=37398156
    - cogman10 3y ago
      Do you think Hollywood is not subject to regulators? Does Disney file a 10-K? Has star wars made a profit? I'd suggest reading the linked wikipedia article first to understand what hollywood accounting actually is. It is neither illegal nor fraudulent. It is arguably immoral, but we aren't talking about morals in this thread. I'll assume you simply don't know what the term Hollywood accounting actually means and that's why you thought I was saying Ford committed fraud.
      - lotsofpulp 3y ago
        > Does Disney file a 10-K? Yes, and they are not required to breakdown financial figures for each movie they make. > It is neither illegal nor fraudulent. Because it is not subject to regulations, it is specifically designed to screw various vendors in the movie business, without violating any business agreements (or skirting the line so that it is not worth the counterparty to file a lawsuit). If Disney did try to submit a 10-K with the same calculations they do for their “Hollywood accounting”, it would be illegal. The key point in the Hollywood accounting Wikipedia write up is: > Because of the studio's ability to place arbitrary charges along the value chain, net participation "points" (a percentage of the net income as opposed to a percentage of the gross income of a film) are sometimes referred to as "monkey points". The term is attributed to Eddie Murphy, who is said to have also stated that only a fool would accept net points in their contract. This is all irrelevant for SEC filings, since those have to include ALL ins and outs of the business. If a Disney CEO tried to screw investors by artificially lowering net income and reducing the investors’ profit, heads would roll. This is ignoring the basic fact that CEO and other company executives are compensated in shares in the first place, which means they want net income to be high so that the share price goes higher.

notdarkyet 3y ago

That Ford 23 billion number you are citing is Gross Profit, not NET This number ignores expenses that are not involved with the product and cost of goods sold. https://www.investopedia.com/terms/g/grossprofit.asp#toc-gross-profit-vs-net-income https://www.investopedia.com/terms/g/grossprofit.asp#toc-gro... https://finance.yahoo.com/quote/F/financials?p=F https://finance.yahoo.com/quote/F/financials?p=F "You should really sit down and do the math on this stuff." Before coming in hot with numbers and firing back I would check what you are saying first.

cogman10 3y ago
Perhaps consider Hollywood accounting [1] before being concerned with net income. Suffice it to say, it's within ford's best interest to often report negative or near negative net profits. That's how you reduce your tax burden. It's super easy for a company to make up additional overhead above and beyond gross profits to disappear everything. (including money spent on stock buybacks, dividend payments, and CEO perks). A company that has 23 billion in gross profits and -2 billion net income isn't what you think it's saying. [1] https://en.wikipedia.org/wiki/Hollywood_accounting https://en.wikipedia.org/wiki/Hollywood_accounting
- lotsofpulp 3y ago
  If you are equating unregulated Hollywood accounting to SEC regulated 10-K filings, then either you need more education, or you distrust the system so much that conversing would be pointless. And businesses cannot reduce net income by the amount of dividends or stock buybacks, for obvious reasons.
  - cogman10 3y ago
    > If you are equating unregulated Hollywood accounting to SEC regulated 10-K filings, then either you need more education Are you saying it wouldn't be advantageous to claim an easily recoverable loss which both makes your shareholders happy and reduces your tax burdens not only for the current year but future years (because you can defer losses)? Hollywood accounting is orthogonal to the concept of a 10-k. The numbers are "real" but they are also VERY easy to manipulate (IE, doing a stock buyback). I'd suggest considering the case study of sears. Where somehow a public company went bankrupt yet the owner ended up with billions of dollars and... the company.. again.. somehow. [1] That is hollywood accounting in it's full action and all perfectly lined up for 10-ks (after all, AFAIK the SEC never stepped in here to give Lampart so much of a slap on the wrist). I'm not saying that Ford or others are anywhere near as bad as what happened to Sears/Kmart. I am saying that the same system Ford operates in, sears operates in. [1] https://www.investopedia.com/news/downfall-of-sears/ https://www.investopedia.com/news/downfall-of-sears/

motles 3y ago

Uh. 23 billion was the gross profit 12 billion operating income -1.9 billion net income Ie they lost money in 2022 when all was said and done. Also no company that has taken outside money from investors can just give their profits to employees and not share the profits back to the investors. No investor would ever give money to a company where their share of the profits - which they were duly owed because they took a risk and put money into an enterprise - is not returned to them - and instead shared to employees because it’s the righteous thing to do. No CEO or CFO would keep their jobs for long if they did this. That’s just not how capitalism works.

PaulDavisThe1st 3y ago
This is just such a ridiculously limited view of how investment can work and what capitalism is. Tons of investors give money to companies without any realistic expectation of ever receiving any profits - they believe that the value of the stock they own will increase in the judgement other future stock owners. That's the only reason Amazon was able to receive capital investment for more than a decade. Workers also take a risk in choosing to go work for a company, and frequently it is a bigger risk than the one taken by capital owners. The latter will rarely invest in a way that puts their lifestyle on the line, whereas that's all the former can do. There are pros and cons of the capitalist system, but it does neither capitalism nor us humans any service to present this sort of childish 10th grade view of what it is and how it works (or doesn't).

AnimalMuppet 3y ago

You need to re-do your math. In addition to what others have said, if they start paying 40 hours pay for 32 hours work, they're going to have to hire 25% more people to produce the same number of cars - that is, to reach the same income.