The UAW crisis: The Ford contract

February 18, 1982

The auto industry accounts, directly or indirectly, for one out of every six jobs in the U.S. That takes in many millions of workers.

In that sense it is scarcely comparable to any other industry. What happens in labor relations between the UAW and the auto barons, therefore, is of singular significance to millions of other workers.

For many years the UAW set the pattern for other unions, even those which don't enjoy the privileged position that auto workers have held for such a long time -- until the present crisis.

Ford settlement affects millions

The concessions made by the UAW in its current contract with the Ford Motor Co., if ratified by the membership, are bound to influence many other unions, and will directly affect millions among the unorganized workers.

Almost immediately after the ratification of the UAW-Ford contract, workers in the auto supply industries will be pressured most severely for similar, if not greater, concessions. Of course in cases where the workers are weakly or not at all organized, the corporations will press for even more far-reaching demands.

It is sometimes said that between 40% and 60% of manufacturing costs in the auto industry come from supplier products. These, of course, are the products made by other workers who are intimately linked to the fate of the UAW contract.

Did the UAW leaders give ample consideration to the fact that in reality they were negotiating not only for the Ford workers, but perhaps for millions of others as well?

It is impossible that the UAW leaders could have been unaware that reverberations from their concessions would affect millions of other workers.

UAW once won shorter work week

Aside from setting the pattern for other unions, the UAW has frequently been in the forefront in introducing innovations in its contracts that acted as spurs in the struggle to gain wider social benefits for the working class as a whole.

For instance, in the 1979 UAW contract the union was able to win a provision with respect to personal paid holidays for the workers. Such a provision, when implemented and extended, has great importance from the vantage point of widening social benefits that have historical significance.

What is involved in this apparently unimportant innovation, started by the UAW is that it tends to shorten the working time in the plant for the workers.

It should be remembered that what originally gave an impetus to the development of the trade union movement in the U.S. on a national scale, which was later taken on worldwide by the working class, was the struggle for the eight-hour day. This was begun in the U.S. as a May Day demonstration. The struggle continued for many, many years until the eight-hour day became almost universally recognized as the standard for the workers for the entire historical period.

In recent years, the demand for the 35-hour week has been raised in many unions. It was raised with particular vigor at successive UAW conventions.

It therefore can scarcely be regarded as an accident that in the 1979 contract the UAW was finally able to win a provision for 26 paid personal holidays, or about nine per year.

What social significance does this innovation have?

It not only shortened the working time for each worker, but it also created jobs for others by the very act of shortening the work time. Thus, when a worker is off, another worker fills his or her particular spot.

New contract lengthens working time

The elimination of this provision of the contract not only lengthens the working time for the employed worker, but also facilitates the displacement of others and thereby creates a job loss.

Estimates vary as to how many jobs will really be lost, but they number in the many thousands, especially if GM workers go along with the same concession.

In the light of history, the concession points to a wholly regressive trend which the working class fought to overcome decades ago. The lengthening of the work time was used as a weapon during the early phase of primitive capitalist accumulation, when the capitalist system was most oppressive.

The fact that both GM and Ford have singled out this particular provision for elimination forecasts an intention to roll back the social benefits of the working class in general to that very rudimentary stage of capitalist development -- the stage of primitive accumulation which was the Stone Age of capitalism.

It would be a mistake to view this demand by the auto barons in strictly pragmatic terms. The loss that the workers will have to endure if the Ford contract is ratified admittedly amounts to $1 billion over a period of 31 bloody months.

The loss of the personal paid holidays (PPH) in strictly financial terms appears rather insubstantial, if not minimal. What is significant, however, is the trend that it sets in motion -- the lengthening of the work time, which was abandoned decades ago by the ruling class after protracted struggle. It is now being reintroduced through the back door, so to speak.

Promoting this concession encourages the reduction of vacation time, coffee breaks, etc., which again lengthens the working time. Unquestionably, employers will find even more devious ways, basing themselves on this precedent, for still further lengthening the working day and thus setting in motion a new reactionary cycle of social development that is wholly anti-working class in its character.

Job security provisions vague

The million-fold loss in monetary compensation that the Ford workers will suffer is of course the principal point of contention, along with the cutbacks and plant closings. The company has agreed in principle to hold these off in the form of a moratorium for two years.

The tradeoff, however, is neither firm nor binding and is not really enforceable. It is all contingent, of course, on the company's "good faith" effort.

It is this contingency which really vitiates the vague legalistic language employed in the contract. Were this otherwise, the moratorium on plant closings and the language on out-sourcing would really be a breakthrough for the union.

Not even the union leadership, however, including Fraser himself, can make such a flat assertion.

The greatest failure of the UAW leadership with respect to the struggle against the auto barons lies in their tardiness in recognizing the danger that had clearly revealed itself to them as long ago as July 1980.

It was then that the auto magnates made known to the press that they were about to launch an unparalleled drive to restructure the industry and to invest unprecedented amounts of money on automation with thousands of robots and the most sophisticated technology overall.

$80 billion investment fund

An authoritative front-page article in the July 20, 1980, edition of the New York Times datelined Detroit disclosed that "the major auto manufacturers are expected to spend an astronomical $80 billion by 1985 to develop and produce cars and trucks. ... To meet that goal they are redesigning nearly every part and component of their products and retooling every plant."

It continues, "GM alone is spending at the rate of more than $1 million an hour and plans to do so for five years."

This was public notice to the UAW that the industry had $80 billion available to it and would use it in such a way as to displace hundreds of thousands of auto workers and virtually reduce the union to a shell.

This challenge by the auto monopolists had to be taken seriously and quickly. The UAW could not go on from day to day allowing the auto companies to lay off workers here, shut plants there, consolidate others, and in general create chaos among the workers in an effort to feather its own nest on the backs of the workers.

At the time of the Chrysler crisis, it was the duty of the UAW leadership to make a unified stand and not allow its units to be picked off one by one; or worse still, to allow each division to do its own bargaining, thereby weakening and dispersing the union's strength.

Each day lost since this public notice of July 1980 meant a continual, debilitating, and frustrating retreat -- unless the union girded its loins, called a special convention by virtue of the statutory provisions in the constitution, and demanded a halt to the auto magnates' efforts at piecemeal destruction of the union through unilateral attempts at layoffs, cutbacks, and plant closings.

Move to unite labor

It would seem that for a while the UAW leadership did recognize the inherent threat to the membership as a whole when the UAW decided to rejoin the AFL-CIO. It seemed this was not merely an effort to strengthen political opposition to Reagan but to form a broad united front with the entire labor movement in order to ward off the threatening nationwide anti-labor offensive of the ruling class.

The auto monopolists, after all, were merely the vanguard in a wholesale attempt to create a veritable counter-revolution in labor relations that would throw the working class back by decades. What the Reagan administration was doing politically, the ruling class as a whole was attempting to do in the private sector. This would surely be even more injurious in magnitude than the cutbacks in social services that the Reaganite budget was pushing forward.

The UAW's struggle with the auto barons cannot be fought on a traditionally narrow, single-company or single, industry basis. It must be recognized as a national effort by the ruling class which is dead earnest in its attempt to turn the clock back.

Lessons of earlier recessions

Compare the situation now to what it was in 1907-1908 when Henry Ford first brought out his Model T car. The year was one of severe recession. It culminated in a panic in the financial markets.

The contraction of the economy, that began in May 1907 and continued to June 1908, although relatively brief, was extremely severe and involved a sharp drop in industrial output, causing much unemployment.

The economic crisis of 1907-1908 is considered the most severe of the capitalist cyclical crises up to the great crash of October 1929. Important to remember by way of comparison with today's situation is that it was the innovation of mass production, with the introduction of the Model T car, which began to lift the capitalist economy out of its crisis and brought about a significant recovery.

It was the contribution of mass production and, as we said in our earlier article, the reduction in price of the Model T car from $950 in 1909 to $360 in 1916 and an astonishing $290 in 1926 which was responsible for making the U.S. auto industry the principal producer on a world scale, enabling the U.S. to achieve mastery of the world market.

The dead hand of full-blown monopoly capitalism had not yet fully enveloped the entire auto industry or fully integrated it into its worldwide network of finance capital. Of course, Ford ultimately fell victim to this inexorable process.

The Ford contribution of mass production demonstrated that it was possible to raise wages and increase employment while winning staggering markets for the sale of millions upon millions of cheap Model Ts.

What the magnates of this day and age have in mind is a totally different historic process. Instead of low-priced products, they favor keeping prices high over the years as an expression of their lust for super-profits, even at the cost of unemployment and lower wages.

Complying today with these demands of the auto barons would constitute a virtual counter-revolution in labor relations. Is this what the auto union leaders are about to inaugurate by pushing the Ford contract as the initial step on such a perilous road?

UAW should focus on $80 billion fund

Rather than being mesmerized, confused, and frightened by the seemingly enormous losses of several billion dollars claimed by the auto monopolists, the union leadership should instead focus its attention on the truly gargantuan size of the funds available to the auto barons which are in the magnitude of $80 billion, as authoritatively estimated by the New York Times.

This has been a century of the most stupendous technological developments in manufacturing; we now live in an age of electronics, computerization, and satellites, when scientific discovery and invention makes it possible to apply high technology in the production of virtually limitless wealth. Yet the auto barons can do nothing better with their $80 billion investment fund than continually raise the already extortionate prices for automobiles, while at the same time creating unprecedented unemployment! Is this not an unfailing sign of the auto barons' socially parasitic character and their economic and political bankruptcy?

The auto barons are planning to use the 80 billion investment fund destructively against the workers and against society. The UAW leadership therefore have an obligation to declare themselves the trustees of this investment fund and to utilize it under the democratic control of the workers on behalf of production for use, for full employment, and ultimately to facilitate the complete ownership by the workers of all the means of production.

The auto leaders, and the workers too, have a responsibility to the working class as a whole. What happens in auto is bound to have a domino effect in labor relations generally.

For each union to go its own separate way, at a time when the ruling class is hell-bent on pushing through a nationwide anti-labor offensive, is not only thoughtless but completely self-defeating.

The hour for rethinking the whole strategy is late indeed. But it is most urgent.

There is still time to abandon the path of surrender and defeatism and return to the heroic days when the UAW was the real vanguard in the struggle against the mighty corporations in the historic battles of the 1930s.

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