Harold Meyerson: The Vanishing Middle

Wednesday, October 12, 2005; A17

We're leveling down.

With the bankruptcy filing Saturday of Delphi Corp., the largest American auto parts manufacturer, the downward ratcheting of living standards that has afflicted the steel and airline industries hit the auto industry big-time. As Delphi executives tell the tale, they need to reduce the hourly pay of their 34,000 unionized employees from the current $26 to $30 range to a somewhat more modest $10 to $12.

No one denies that Delphi is losing money -- about $5.5 billion over the past year and a half. Its labor costs are roughly 10 times those in Mexico and China, where an increasing number of parts that go into cars assembled in the United States are made.