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The UAW at the crossroads

Part 2

Published Mar 7, 2009 6:51 AM

“I’d say you’ve got to give Ford a lot of credit. I do.” Any one of Ford’s workers would have to wonder, credit for what?

In 2008 the company had the biggest loss in its 105-year history: $14.6 billion. As of March 1 Ford stock is worth $2 a share. Vehicle sales are down 40 percent from February 2008. The company’s assets were put up as collateral in 2006 to obtain $23.4 billion needed for a “restructuring” that has cost 50,000 jobs.

The source of the quote in the Feb. 27 Automotive News, Ford CEO Alan Mulally, isn’t exactly objective. Mulally is patting himself on the back because Ford has not had to ask for federal government assistance. This means that he, unlike GM’s Rick Wagoner and Chrysler’s Bob Nardelli, will not be working for an annual salary of $1.

Mulally’s “voluntary” 30-percent pay cut leaves him making “only” $15.96 million, based on his 2007 compensation. That’s “only” $15.9 million more than a Ford production worker makes putting in a 40-hour week with no layoffs.

Mulally is also feeling perky over Ford being the first of the Detroit Three to squeeze precedent-setting concessions out of the United Auto Workers. The cost of living allowance—pioneered by the UAW in 1946 and standard since—is gone. So is the eight-hour day.

In 1938 the Fair Labor Standards Act made employers pay time-and-a-half after 40 hours worked in one week. The UAW contracts went further by mandating premium pay after eight hours in any single day. Now hourly workers will work longer days for straight-time pay.

Ford workers are voting by March 9 on whether to go along with the contract revision, which also cuts pay, break time, holidays, and Supplemental Unemployment Benefits, and further endangers retiree health benefits. As of March 1, one UAW local accepted the concessions, but with a significant 41 percent voting no.

It’s assumed that UAW members at Chrysler and General Motors will be asked to approve the same deal. They might as well be voting with a loaded gun to their heads, considering the number of bankers, politicians, and so-called “economists” and “analysts” who are demanding union-busting-by-bankruptcy.

The latest is New York Times columnist Thomas Friedman. “It is time that [GM] and Chrysler were put into bankruptcy so they can truly start over with ... new labor agreements,” Friedman argues, although he adds, “We have to shore up the banking system, which underpins everything.” Friedman isn’t just speaking his own twisted opinion. What Wall Street thinks, Friedman puts into writing and the Times prints as economic gospel.

The bankruptcy’s impact on workers and retirees is of no concern to finance capital. They probably cheered on Feb. 24 when federal bankruptcy Judge Robert D. Drain allowed Delphi, formerly GM’s parts division, to end all health-care coverage for 15,000 non-unionized retirees. Retirees’ hardships were weighed against the $70 million annual savings to the company.

Meanwhile, GM’s pension fund is reportedly under-funded by $12.4 billion. Gambling on the stock market has put workers’ deferred wages in jeopardy. Adding to the shortfall was GM’s use of almost $3 billion from the pension fund for buyout programs to entice employees to retire or quit, thereby shrinking the work force through “special attrition.”

The companies have been demanding lower prices from their parts suppliers, which have in turn sought pay and benefit cuts from their union employees. Auto suppliers have posted big losses. Lear, Visteon and others are on the verge of bankruptcy—from which Delphi has acknowledged it may never emerge, despite huge concessions. Delphi has even suspended production in Souzhou, China.

Competition versus solidarity

Everywhere they turn, auto workers are bombarded with the message that they must make sacrifices so Ford, GM and Chrysler can be “competitive.” That same capitalist competition is driving GM to consider eradicating Saturn—once hailed as a “new kind of company.” GM is dumping Saab and likely will shed part of GM Europe’s Opel division.

With whom are UAW workers supposed to be “competitive?” Nearly every auto company in the world is watching sales fall. Toyota, now the world’s biggest automaker, lost $4 billion in 2008, its first loss since 1950. All of Japan’s car companies have slashed production worldwide: 39 percent at Toyota, 33 percent at Honda, 54 percent at Nissan and Mitsubishi, and 63 percent at Mazda. GM Europe, which includes Saab, Opel and the British brand Vauxhall, has demanded $1.2 billion in “cost cutting,” while at the same time asking European governments for financial assistance. European car companies also want government help and are laying off workers.

The crisis of capitalist overproduction is worldwide. More has been produced than can be sold at a profit. No wage reduction has ever solved that crisis.

Auto workers can refuse to pay for a situation that they did not create—and some already are doing so.

“Thousands of Opel workers from around Germany took part in a mass rally today at the company’s headquarters, demanding that parent General Motors scrap plans for plant closures in Europe. Protests were also planned today at GM factories in the UK, Spain, Sweden, Poland, Russia, France, Austria and Belgium, as well as at other German plants.” (Automotive News, Feb. 26)

“Trade unions and globalization-critical protesters are planning demonstrations in Berlin and Frankfurt under the banner: ‘We’re not paying for your crisis.’” (Spiegel International, Feb. 26).

These well coordinated and quickly built simultaneous demonstrations in nine countries show not only mass anger but tremendous potential. Imagine if this movement were to spread to the U.S., Canada, Mexico, South America, Africa, and Asia. The UAW needs to see that international working-class solidarity is key to protecting workers’ rights to their jobs.

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