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The Auto Crisis: Management, Labor and the Struggle for the Future

by DAN LaBOTZ

The crisis in the auto industry is about many things: the possible collapse of GM, Detroit gas guzzlers, auto emission standards, the environment, and the need for mass transportation, among others. But as became clear this last week, at the center of it all is the struggle between management and the workers, that is, between capital and labor. The crisis in auto is fundamentally about driving down workers’ wages, taking away their benefits, and putting management firmly in control of the workplace.

Mitt Romney, candidate for president in the Republican primaries, in his op-ed piece in the New York Times titled “Let Detroit Go Bankrupt,” wrote that the Big Three’s “huge disadvantage in costs relative to foreign brands must be eliminated.” How? By making “new labor agreements to align pay and benefits to match those of workers at competitors like BMW, Honda, Nissan and Toyota.” Second, says Romney, “retiree benefits must be reduced so that the total burden per auto for domestic makers is not higher than that of foreign producers.”

A few days later New York Times columnist Joe Nocera argued that bankruptcy would be too long and slow a process to save the industry. He suggested that President-Elect Barack Obama create an auto Czar, someone like former Secretary of the Treasury Larry Summers, to negotiate a new deal in auto. What would that deal look like? “It needs to dramatically reduce its legacy benefits, perhaps even eliminating health care benefits for union retirees. It needs to close plants. It needs to pay its workers what Toyota workers are paid in the United States—and not a penny more.”

In fact, Toyota and other transplant workers have been being paid just about the same wages as UAW members, as a way of keeping them out of the union. But, Nocera is arguing that breaking the union contract will make it possible to push wages much lower.

Nocera points back to the Chrysler Bailout of 1979 when the Federal government succeeded in pressuring the United Auto Workers union to accept concessions. President Jimmy Carter and the U.S. Congress, working with GM and the UAW, negotiated the downsizing of the company from almost 100,000 to just 57,000 jobs.  Black workers were particularly hard hit because so many Chrysler plants were in Detroit. The agreement broke the Big Three contract, leaving Chrysler workers $3.00 an hour behind workers at the other two. The Chrysler Bailout is a kind of a model for what the business class has in mind this time, only now they want to drive the workers much further back.

The Bailout: Discipline Labor

The Big Three have gone to Washington to ask the government for a bailout to save the industry. Ron Gettelfinger, President of the UAW, has gone along with the CEOs, telling Congress that, “Inaction is simply not an option. Without immediate assistance, we could see—and I stress could see—a collapse of one or more of the domestic auto companies by the end of this year.” But he must understand that when automakers talk about saving the industry they mean exactly what Romney and Nocera call for: plant closings, wage cuts, and slashing of benefits.

The U.S. government, as the highest political expression of capital’s power in this country, will come to the aid of the auto industry—meaning aiding the auto companies to break one of the last strongholds of the old industrial unionism. A U.S. government bailout of auto, given with strict conditions demanding concessions, will stiffen the backbone of the Big Three and put a club in their hand so that they can finally and once and for all get rid what remains of what was once a powerful union. To America’s rich and powerful to save the auto industry means to save its profitability. It has nothing to do with saving jobs, workers or their communities.

The Union in Retreat and Challenged

Ron Gettelfinger and other UAW leaders have during the last two decades overseen the decline of the union. Summarizing that period, Mark Brenner and Jane Slaughter wrote in Labor Notes, “In essence, the UAW’s deal with the auto makers was this: do whatever you need to do to boost profits, as long as you maintain the wages and benefits of (a steadily shrinking number of) workers at the Big Three. That ‘whatever’ included lean production, outsourcing to nonunion parts plants at home and abroad, the sale of GM’s and Ford’s parts divisions in 1999 and 2000 (lopping off 52,000 workers) and, today, buyouts. There were 466,000 GM hourly workers in 1978 and in 2006, 112,000.”

While the UAW leadership bargained away the gains of the previous thirty years they were opposed at every step by various rank-and-file opposition groups in the union: Locals Against Concession in the early 1980s, the New Directions Movement in the mid-1980s and 1990s, and most recently Soldiers of Solidarity. Both the Big Three and the UAW, and sometimes the two colluding together, opposed the grassroots movements which called for defending the union and fighting back against the bosses.

Opposition has become more difficult as the combination of plant closings and concession contracts tended to divide the UAW Big Three’s membership into three groups: retirees, first tier workers with full wages and benefits, and second tier workers receiving lower wages and fewer benefits. Then too there are the divisions between the Big Three workers and the parts plant employees and also between the unionized U.S. auto companies and the non-union foreign auto companies operating in the U.S. Achieving unity among these workers won’t be easy. Many auto workers today feel that little can be done to save the industry, the union, or even their contracts and wages.

Yes history shows that workers’ movements—industrial workers in the 1930s, African American workers in the 1960s, and women workers more recently—have been at the center of every major progressive movement in modern society. Workers do have the power to do something, but only when we act and when we have a plan. What’s needed at this point are precisely thosee two things: First, a plan that save auto workers’ jobs and communities. Second, a movement to fight for that plan.

Frank Hammer

, a retired UAW-GM Department International Representative and past president and chairperson, UAW Local 909 in Warren, Michigan, has suggested an action plan. He writes, “This is a defining moment for the UAW, and the entire labor movement.  25 years ago PATCO was crushed by the deregulators’ champion in the White House, Ronald Reagan.  Today we are faced with a much larger devastation at the hands of the outgoing George W. Bush and his Republican friends.”

Hammer calls for the organization of some sort of protest. “The leadership should organize a car caravan around the headquarters of the Detroit 3 or, with the help of the AFL-CIO, organize a caravan to Washington, D.C. or even Wall St. There’s no guarantee to what we could achieve, but we should nevertheless proclaim, ‘Not without a fight!’ We are running out of time. Wouldn’t having UAW members out in the streets be a good way to let everybody know that we re not dead?” Apparently Hammer’s suggestion has bee picked up by the media, by car dealerships, and perhaps even by the companies. Whoever organizes it, a militant crowd of autoworkers in that parade with its own demands would be a good idea.

UAW members need to go to Washington with more than their hands out; they need to put forward an alternative plan for the industry. Some longtime UAW activists have begun to put forward a various ideas which taken together represent an alternative to the notion that the bailout should be a bludgeon to be used against workers. Jerry Tucker, for example, has argued that the auto crisis demonstrates the need and the opportunity to create a national health care program such as Canada has had for some time. Retired auto worker activist Dianne Feeley argues that we could “Convert the excess plants in the auto parts sector to useful green jobs. We need to create solar, wind and geothermal energy. Axle plants, for example, can be converted to produce wind turbines, a product not currently made in the United States.” These suggestions represent the beginning of a program for the auto industry that could save workers jobs and communities.

Obama Says: “Come Back with a Plan”

President-Elect Barack Obama said in his press conference on Nov. 24 that the auto industry executive should come back to the new Congress and his administration with a plan. But shouldn’t the UAW and the auto workers—unions and workers who worked for Obama—come back with their own plan as well? What would be at the center of the auto workers’ plan? I don’t think that’s hard to guess: Saving our communities. Saving auto workers’ jobs. Rebuilding America’s auto, transportation, and energy industry—efficient autos, light rail, high-speed trains, wind turbines. Making a good job the center of a good life.

Shouldn’t the American people come back to Congress with their plan too? And if we did appear in Congress, wouldn’t we say, “Yes, of course, you can use some of my tax money to save these jobs. But if we put up the money, then we want ownership in these companies, and a voice, and a vote. If ‘We the People’ put up the money and take ownership of these companies, then we want a citizens advisory council made up of auto workers—engineers, technicians, skilled and unskilled workers—as well as consumers, and environmentalists to run the company.”

Maybe we all—auto workers and citizens—should take our plan to Washington in a big caravan as Hammer suggests.

We Need a Broader Response

Autoworkers surely shouldn’t have to do all of this by themselves. What’s happening to autoworkers today happened to steelworkers a few decades ago, and even groups as apparently secure as health and hospital workers can expect to see similar industrial challenges—and the demand that workers pay for the problems—coming in the future. Auto has gone to Washington precisely because it faces a problem that can only be solved—from the standpoint of the CEOS—on a broad basis. The auto industry needs to have business generally, and the government in particular, to help it to reorganize the industry. Similarly auto workers to defend themselves need to have the support of the labor movement generally.

If the auto companies and the government negotiate a bailout that drives the UAW and its members back into the past, we will be going back with them. Everyone’s job, everyone’s wages, everyone’s health care and pension is at state in this. We need to begin to fight back and there isn’t a moment to lose.

Dan La Botz is a Cincinnati-based writer, teacher and activist. He can be reached at DanLaBotz@gmail.com

Mitt Romney, “Let Detroit Go Bankrupt,” The New York Times, Nov. 19, 2008.

Joe Nocera, “Road Ahead is Long For G.M.,” The New York Times, Nov. 22, 2008.

AP, Nov. 20, 2008.

Mark Brenner and Jane Slaughter, “End of the Road: If the Auto Industry is Dead What does that Mean for Workers?” Labor Notes, http://labornotes.org/node/254.

New Directions Movement website: http://www.uawndm.org/;  Soldiers of Solidarity website: http://www.soldiersofsolidarity.com/.

Frank Hammer, “Don’t Let Them Destroy Our Union” Center for Labor Renewal,

Aimee Allison, “Interview with Jerry Tucker, Former UAW Official, on the US Auto Industry in Crisis,” Monthly Review, MRZine, http://mrzine.monthlyreview.org/tucker231108.html

Dianne Feeley, Autoworkers Face the Crisis” Solidarity homepage, “http://www.solidarity-us.org/autocrisis”

 

 

 

 

 

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