Last week autoworkers at a Volkswagen plant in Chattanooga, Tennessee voted to block the introduction of the United Auto Workers as their labor representatives. The vote followed a long, controversial campaign involving various politicians, third party advocate groups and lots of money.

So is this a serious blow to unions and laborers in the United States with lasting ramifications or an obvious decision in an anti-union southern state?

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That all depends on whom you ask.

For VW, a German company that operates largely through the use of works councils, this might mean the end of plants in the U.S.

Bernd Osterloh, the head of the VW works council told German newspaper Sueddeutsche Zeitung: "I can imagine fairly well that another VW factory in the United States, provided that one more should still be set up there, does not necessarily have to be assigned to the south again."

This is especially significant since works councils have to approve any decisions to open or close any VW plants and VW has been publicly deciding whether to move some of its U.S. production into Mexico.

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Senator Bob Corker (R-Tenn.), however, told reporters "I've had conversations today and based on those I am assured that should the workers vote against the UAW, Volkswagen will announce in the coming weeks that it will manufacture its new mid-size SUV here in Chattanooga."

Some experts are looking into the legality of Corker’s claims seeing as how they differ vastly from VW’s public neutrality toward the union vote and support of workers councils. If Corker’s words can be considered intimidation they would be in violation of federal labor law and would nullify the most recent vote. President Obama, in a closed door meeting with Maryland lawmakers, also expressed anger with the lawmakers who opposed unionization.

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For the United Auto Workers, this vote has been an extremely low blow. UAW membership has declined by 42% over the past 10 years and anti-union sentiment is now creeping north with Michigan, one of the largest auto-building states in the U.S., which ecently voted to become a “right to work” state. UAW president Bob King has said that without an increase in union presence down south, “I don’t think there is a long-term future for the UAW.”

Steven Rattner, former lead advisor of Obama’s Presidential Task Force on the Auto Industry, joined The Daily Ticker to discuss the recent UAW defeat in Tennessee.

“I think that many of those workers down there have the view that the UAW couldn’t or wouldn’t help them and why should they pay them dues? They had jobs and they were happy with their jobs,” he says.

Rattner believes that recent criticism of the UAW is unwarranted, although he admits they were partially responsible for the recent collapse of the Detroit auto industry.

“The UAW today is a much changed organization and really does what it should be trying to do which is get workers more pay,” he says.

As for the subsidies that states like Tennessee are paying large companies (like VW) to attract business and jobs, “they’re kind of a necessary evil,” says Rattner. “We need jobs, even jobs that are not paying as much as they used to pay. The thing that’s unfortunate is that it’s not always a competition between the U.S. and some foreign country -- it’s often a competition within the U.S…This is not great policy but in the list of problems we have I’m not sure this is one people are particularly focused on.”

But when it comes to the fight in Chattanooga, “I think this is largely over,” says Rattner.

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