Blaming the Labor Unions


“The modern Little Red Riding Hood, reared on singing commercials, has no objection to being eaten by the wolf.”

—Marshall McLuhan

The Republicans’ campaign to portray themselves as “plain folks” and the Democrats as “elitists” will remind movie fans of that line from The Usual Suspects, where the guy in the police station is trying to convince the cops that a renowned villain actually exists and isn’t just a figment of the public’s imagination.  The guy says to the police: “The greatest trick the Devil ever pulled was convincing the world he didn’t exist.”

When Republicans like John McCain (who comes from an aristocratic military family, owns eight homes, and is married to an heiress worth in excess of $100 million) declare, with a straight face, that Barack Obama (a man of mixed race, raised in a humble environment by a single mother on food stamps) is an “elitist,” it makes you realize how confoundingly gullible the electorate can be.

The party that opposed desegregation, opposed abolition of the poll tax, opposed allowing people to register at the DMV, opposed allowing them to register at the polling station on the day of election—the country club party that has done everything in its power to see that the poor and ethnic minorities are discouraged from voting—is now doing similar mischief in Michigan, a “battleground state” in the upcoming election. 

According to media reports, the Macomb County (Michigan) Republican Committee is attempting to disqualify those unfortunate people whose homes have been placed in foreclosure, claiming that because they no longer have a “valid” mailing address, they should be ineligible to vote.  In other words, the Michigan Republicans are arguing that people who’ve had their homes repossessed should be deprived of their constitutional right to vote.

Yet, the Republicans continue to pass themselves off as the “party of the people.”  And therein lies the Orwellian horror.  This ideological sleight-of-hand has to be one of the greatest stunts the Party ever pulled off—right up there with touting the virtues of free market fundamentalism, while, simultaneously, asking the federal government to step in and “nationalize” the beleaguered financial industry.

There’s another weird and annoying lie being shopped around out there, and this one involves Detroit.  With all the recent bailouts making headlines, it was only a matter of time before the auto industry approached the feds, hat in hand, asking for free money.

Despite the Big Three (Chrysler, Ford and GM) being the same companies who, historically, have fiercely resisted government meddling in any aspect of their  business—e.g., safety, air pollution, fuel economy—once again these bastions of free enterprise are at Washington’s doorstep, seeking federal assistance. 

Still, from the automakers’ vantage point, there’s no irony whatsoever involved.  Petitioning the government makes eminent sense.  After all, when you’re in a financial jam, you sniff out the money; and with the banks strapped for cash, the money trail leads you straight to the feds.  If they don’t have enough, they can always print more.

However, unlike the financial institutions whose insatiable greed and woeful shortsightedness were responsible for the current Wall Street crisis, the automakers came armed with a convenient scapegoat.  They blamed the UAW (United Auto Workers) for their predicament.  The pitch worked. The automakers walked away with a $25 billion “relief package.” 

But to blame the union for Detroit’s mess is not only inaccurate, it’s absurd on its face.  If the stakes weren’t so high and the economic consequences so potentially devastating, the charge would be howlingly funny.  Since when do workers call the shots?  Since when do they control anything?  How can working people, who are excluded from the decision-making process and powerless to affect marketing decisions, take the blame for the bosses’ errors?  That’s like an incompetent carpenter blaming his tools. 

And what, specifically, were those management “errors” that led to the automakers troubles?  Well, two of them loom large.

First, even though the Big Three have complained for years that medical insurance costs were eating them alive, comprising almost 40% of their labor payroll, it was Corporate America who did everything possible to torpedo any attempt to adopt a national health care plan.  They’ve been opposing it for half a century—ever since Truman first suggested the plan, following World War II—screaming hysterically that national health care represented “socialized medicine.” 

Meanwhile, American industry continues to compete with industries in countries where medical costs are absorbed by the government.  Workers in neighboring Canada (the United States’ largest trading partner), whose automakers are unionized, have a national health care plan.  Not having to underwrite the employees’ medical insurance is a staggering advantage for companies competing with the United States, one which Detroit itself helped perpetuate.

Second, the Big Three badly misread and misrepresented the market.  Union workers will build any damn vehicle they’re told to build.  You want four-wheel barges?  They’ll build them.  You want military tanks?  They’ll build them.  You want small, safe, fuel-efficient, low-priced cars that will run for 15 years?  They’ll build those, too.

Instead, Detroit’s auto executives, spurred on by the oil companies, resisted manufacturing small, modestly priced, fuel-efficient cars, choosing to build tricked-out, high-profit SUVs, pick-up trucks, and other “novelty” vehicles, and to rely on creative marketing and saturation advertising to carve out the necessary consumer niche. 

It’s reminiscent of smog devices.  While Detroit was futilely spending tens of millions of dollars lobbying Congress not to make air pollution (or safety) equipment mandatory, Japanese manufacturers, recognizing the inevitability (and wisdom) of such devices, were quietly developing an efficient catalytic converter.  Egregiously late to the party, Detroit took years and spent enormous sums playing catch-up.

Of course, it goes without saying that the singular event that changed everything for the auto industry was Japan’s spectacular entry into the U.S. market—and that was something for which Detroit can’t be blamed for not anticipating.  The Japanese auto industry, which, seemingly, came out of nowhere, turned out to be an economic juggernaut and minor revolution.  But, as David Halberstam noted in his book, “The Reckoning,” while Japan’s eventual market dominance was earned through quality products and precision planning, part of it was also “rigged.” 

Rigged how?  In order to gain a foothold in the most lucrative market in the world, the fledgling Japanese auto industry resorted to “dumping,” which is the practice of selling cars at costs lower than are profitable.  They desperately needed entry into the U.S. market, and used any means—even an unethical one—to do it.

In the beginning, Japanese automakers were actually losing money on every sale of certain models sold in the U.S.  To keep the enterprise economically feasible, the Japanese government subsidized the car-makers.  It was a partnership.  Understandably, U.S. companies couldn’t compete with these well-designed, “artificially priced” cars, and although they made their objections known, little was done to address the “dumping” issue.

But that’s ancient history.  The part of Japan’s industrial success that was “earned” (besides the fact that, undeniably, they make an excellent product), was the forging of a healthy, balanced relationship between labor and management. 

The discrepancy between the salaries of Japanese executives and the hourly workers is, even to this day, but a fraction of what it is in the U.S.  Unlike their Japanese counterparts, American executives demand to be treated as corporate “royalty” and to be compensated accordingly.  As a result, although the Japanese auto industry is unionized, their Us vs. Them relationship is far less hostile.

In any event, with or without bailouts, things aren’t likely to improve any time soon for the average American worker—not without a dramatic shift in priorities.  While workers have no say in company policy, they continue to pay the steepest price for management decisions. 

It’s a bleak landscape.  Workers have no cushy landing pad; they have no access to “golden parachutes”; they have no headhunters dedicated to finding them new jobs, no corporate connections, no networks, no fall-back positions, very little flexibility. 

Consequently, working people have little optimism about the future.  All they have is their work.  And with the epidemic of outsourcing, restructuring and downsizing, that work is being systematically taken away from them.

DAVID MACARAY, a playwright and writer in Los Angeles, was a former labor union rep.  He can be reached at dmacaray@earthlink.net

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