Marketplace: News Archives

Thursday, November 2, 2000
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It's Thursday, November 02, 2000. I'm David Brancaccio.

It's not going to get harder to get protection from creditors, at least for now. In their rush to get out of Washington before the election, Senate supporters of a bill to toughen the bankruptcy law failed to muster enough votes to end a filibuster by opponents. While the reform effort is not quite dead for the year, Marketplace's John Dimsdale reports from Washington that its prospects are bleak.

Dimsdale: "Lenders claim bankruptcy protection is too easy to come by these days. For two years banks and credit card companies have lobbied hard for new laws to make it easier to collect debts from people who've declared bankruptcy. There are more than a million bankruptcy filings every year despite the strong economy. It's estimated that unpaid debts cost each American family about $400 a year in higher interest rates and borrowing fees. Gary Kohn is with the Credit Union National Association in Washington."

Kohn: "What we're primarily focused on are a lot of the abuses, or loopholes in the bankruptcy system where people who have enough income and wealth to pay off some of their expenses are able to file bankruptcy, hold on to big homes and boats and cars and go on vacations, but still walk away from their debts."

Dimsdale: "But consumer groups oppose the bill on grounds that it favors the industry and harshly punishes people struggling to put their finances in order. For example, they say the bill would force single mothers trying to collect child support from bankrupt former husbands to compete with credit card companies and banks. Supporters of the reform bill fell six votes short of the 60 needed to cut off debate and bring the bill up for a vote. But 17 Senators were absent and sponsors say they'll try again when Congress returns after the election. However, even if the bill passes, a threatened veto from the President would most likely kill it for this session. In Washington, I'm John Dimsdale for Marketplace."

Being a graduate student can be a real chore the classes they take, the classes they teach, the papers they write, the papers they grade. And then there's their research and or the faculty advisor's research. The schools argue it's all part of the learning process. And for more than two decades, grad students at private universities have been prevented from forming unions and negotiating working conditions. But now, a unanimous ruling by the National Labor Relations Board is clearing the way for such collective bargaining. Bob Moon reports the case involves New York University, but it could affect schools throughout the country:

Moon: "NYU is blasting the decision, saying it shows 'a serious lack of understanding of graduate education.' The university says these graduate students are first and foremost students, whose duties are part of their educational experience. But union organizer Julie Kushner says look, it's no different than others who learn on the job."

Kushner: "There are many industries in which there are trainees and apprenticeships. Pilots apprentice. Carpenters apprentice. That doesn't mean they're denied union rights. So the argument that because they're in training really doesn't carry any weight with the idea that they should still be afforded the right to organize."

Moon: "NYU Vice President Robert Berne argues it's just not the same."

Berne: "What graduate students do in terms of the learning process and the mentoring process and the scholarship process is very different than learning how to be a carpenter or putting hub caps on an automobile."

Moon: "Berne fears collective bargaining could significantly change the relationship between professors and students."

Berne: "Having assignments to various graduate assistant experiences determined by things that unions negotiate as opposed to what's in the best interest of the students. Introducing, essentially, and industrial model into an academic setting."

Moon: "But union organizer Julie Kushner says that concern doesn't excuse the inadequate compensation."

Kushner: "It's a privilege to go to grad school, it's a privilege to be a graduate student but at the same time it's a hardship. People have had to extend their studies by years because they had to work for very low wages and very long hours at the same time they were trying to complete their own studies."

Moon: "At NYU, the students' votes on whether to unionize remain uncounted in the dispute with university officials. NYU says it's considering its legal options. Yale University, where graduate students have also sought to be recognized as a bargaining unit, is urging NYU to carry the case to the federal courts. I'm Bob Moon for Marketplace."

The car sales were down in October…after being hot earlier this year….but manufactures are not throwing in the towel yet General Motors was last month's exception, ringing up sales increases of nearly seven percent. Lester Graham reports.

Graham: "Auto industry analysts say October was probably just a hiccup in what promises to be a record year for domestic auto sales. Ford and Daimler-Chrysler as well Toyota, Honda and Nissan all saw drops in overall sales with Chrysler sales dropping by 7.5. Mike Flynn is with the University of Michigan's transportation research institute. He says even with things a bit slower on the car lots in October 2000 could still break sales records for the industry."

Flynn: "They still have two full months to go. Most of the smalls were up, most of the smaller manufacturers. And, you know, GM was up 6.5 percent."

Graham: "Although most of the manufacturers offered some pretty enticing incentives, GM's offer of five-year zero-interest rate loans on several of its different models obviously appealed to buyers in October. Ford's drop in sales was due partly to the Firestone tire recall. Production dropped to make sure dealers had tire stocks to replace the recalled tires. Its explorer SUV sales dropped, however, some buyers are turning to Ford's new SUV, the escape. Industry experts say industry-wide sport utility vehicle sales remain strong and are expected to continue to increase. The University of Michigan's Mike Flynn says the auto industry is finding that models and brand names don't seem to be as important as those rebates and low-interest loans."

Flynn: "I think what really matters is that the incentives have in fact become ingrained in the shopper's mind because there's so many manufacturers that if I'm looking around for a car, I'm bound to find somebody who has something close to what I want that is under some sort of incentive program."

Graham: "The October sales slow-down was followed by some temporary shut-downs at some auto plants. Most of the closings were expected to only last a week or so to allow inventories to drop a bit. In Jerseyville, Illinois, I'm Lester Graham with the Great Lakes Radio Consortium for marketplace."

The US distributor for those aluminum Razor scooters that have taken the sidewalks by storm is suing 16 competitors for patent infringement. An estimated eight million of these will sold in the U.S. this year, five million of which are genuine Razor. In addition to the Razor-pretenders with other names, there are a significant number of cheaper forgeries out there using a fake Razor emblem that apparently scratches off easily.

The most actively traded stock on the Nasdaq market was the software giant-for stupid reasons. Some investors got it in their head that something bad had happened to Oracle's flamboyant founder and CEO Larry Ellison and they sold like crazy. Trading in the stock was halted for a time. The company says everybody's perfectly fine, nobody's dead, and that Ellison and his chief financial officer Jeff Henley have no career changes planned. Oracle shares closed down 5.75 percent on a day the Nasdaq Composite rose 2.9.

Tech stocks were cheered when the head of microchip giant Intel forecast robust in 2001. Also today, IBM cancelled plans to introduce laptop computers using a chip by rival Transmeta that could have allowed a portable to run as long as eight hours without a recharge. Sony and Fujitsu are using the chip.

And that's the top of our news for Thursday, November 02, 2000. The Dow fell less than 19 points. More details when we do the numbers.