After weeks of negotiating, a walk-out and two-day strike, the United Auto Workers leadership and General Motors reached an agreement for a labor contract.
For weeks, the UAW sat at the bargaining table with GM, attempting to work out a deal where the union would make
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General Motors had agreed previously to settle with the union, but recently went back on its promise and began making further demands. The contract deadline was extended as the UAW attempted to avoid a showdown with management. As it became clear that GM’s capitalist owners would not budge, the UAW called for a strike.
On Sept. 24, UAW members at GM plants in the United States and Canada walked off the job and began forming picket lines. This act was a shift in the UAW’s recent tactics. It was the first time since the 1970s that the union had called for a nationwide strike.
Once the strike happened, the Teamsters announced that its 10,000 automotive transport members would not cross UAW picket lines to deliver GM cars and trucks.
‘Job security’
Job security concerns fueled the two-day strike.
This is one of the most vulnerable areas for unions representing manufacturing workers, especially in the auto industry. Every time unions demand better working conditions in the United States, the capitalists threaten to relocate plants to oppressed countries where labor is cheaper and regulations are less stringent.
For workers in the United States, this reality has meant less union militancy and lower wages and benefits.
For workers in the oppressed countries, it has meant more jobs, but at extremely low wages with no benefits. The vast majority of the wealth generated by workers in Asia, Latin America and Africa is extracted by and centralized in the hands of the imperialist banks and corporations.
In both cases, capitalist globalization has increased workers’ exploitation.
The big capitalist automakers are part of this global race to the bottom.
North American car manufacturers’ sales are down this year. Within the framework of the capitalist for-profit system, companies like GM, Ford and Chrysler are struggling to compete with non-union plants owned by Honda and Toyota. GM’s sales are the best of the U.S. automakers, but they are still down nearly eight percent from 2006.
These figures allow GM to plead poverty and force concessions out of unions that are frightened of plant closures.
The UAW, before the recent deal, had already made many concessions to secure jobs for autoworkers in the United States.
GM’s broken promises
GM, like a growing number of major corporations, has long sought to shift the burden of retiree health care onto the union in order to cut operation costs and increase profits. This goal came to fruition with the union’s acceptance of the Voluntary Employees’ Beneficiary Association.
The concept of VEBA is a union-run trust that shifts the responsibility for company-provided retiree healthcare away from GM and onto the backs of the workers.
The union conceded not only on retiree healthcare, but also it accepted a two-tier wage system. Under the new contract, newer hires will receive less pay than more senior workers.
The UAW accepted these enormous concessions in exchange for maintaining production at 16 U.S. plants for the life of the contract.
The UAW’s membership, like that of many other manufacturing unions, has been ravaged by neoliberal capitalist policies. Membership has declined rapidly due mainly to outsourcing and plant closures. There are 73,000 UAW members at GM today; there were 300,000 three decades ago. Overall, the union has only 520,000 current members, down from a high of 1.5 million.
Immediately following the announcement of the tentative agreement, three former UAW executive board members—Paul Schrade, Warren Davis and Jerry Tucker—circulated a statement disapproving of the agreement. They strongly condemned the pact: “We believe it irresponsible by the parties to this negotiation to shift the burden of risk to the retired workers and their families and release General Motors from its commitment to the full and perpetual coverage of healthcare for the workers who built the wealth of the corporation in the first place.”
The VEBA, the two-tier wage system and other concessions will make the deal hard for rank-and-file workers to stomach. Although the union leadership has ratified the contract unanimously, the agreement will drastically undermine the union in the long run. It provides temporary relief for a few workers, while leaving everyone else exposed to shrinking wages and benefits.
The union’s acceptance of the VEBA strategy represents a step in the wrong direction for the vast majority of the union’s members.
The trend across the United States is not only increases in the cost of healthcare, but double-digit increases. And the retiree-to-active-member ratio of the UAW membership alone shows that the UAW is knowingly assuming a dangerous risk by becoming the healthcare provider. It is taking full responsibility to provide healthcare with a greatly-reduced fund and letting GM—the one with the profit-making capacity to pay for the healthcare—off the hook.
Before the VEBA, GM’s estimated burden for retirees was $58 billion. Now, only about $30 billion will be provided by the company. The Wall Street Journal of Sept. 17 said, “it would almost assuredly open the door to benefit reductions because the trust would probably not be designed to fully absorb double-digit medical cost inflation.”
Given the objective economic conditions surrounding auto manufacturing in the United States and the UAW’s diminishing union membership, a short, last-ditch strike accompanied by numerous concessions to the bosses were not adequate tactics.
The UAW and nearly all labor unions are only addressing the fundamental challenges facing them today by gearing up for the 2008 national elections, hoping that they can help elect a president who will “address labor’s needs.”
But on the issue of healthcare, like all people’s needs, every candidate—Democrat and Republican—premises their proposals on assuring the profits of the industry, insurance corporations, pharmaceuticals, medical institutions and related manufacturers.
Instead of mobilizing millions of workers—union and non-union—to truly fight for a national health care system, paid by corporate profits, the union leadership will spend hundreds of millions in the coming year to “get out the vote.”
These challenges are a product of the capitalist system in its imperialist phase. Unions exist to negotiate on behalf of workers with the capitalists for better wages and working conditions. Like the UAW with GM, they work essentially to create “labor peace,” often at great expense to their members.
Unions should wage militant struggles against the capitalists. Workers struggle within their unions to make this happen. Real union struggles have forced major concessions from the bosses in the past and can do so in the future.
Under capitalism, workers—even unionized workers—cannot win an absolute guarantee to the basic rights they deserve. They might win them on a contract-to-contract basis, but union security is never certain when profits are on the line.
