The opposition in Congress over a proposed bailout of the U.S. auto industrywas not a principled stance against another massive giveaway of public funds to corporations. Instead, it was a calculated anti-union offensive targeting the United Auto Workers. The Republican members were more blatant in their demand that union workers “do their part” to help rescue the “Big Three” by accepting massive concessions.
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If implemented, the White House’s $17.4 billion in emergency loans to General Motors and Chrysler will come at a high cost for workers. The companies are expected to provide a restructuring plan by March 31, following a Bush administration blueprint that would force workers’ wages and benefits downward to make the companies “more competitive.”
Accompanying the Bush “rescue” plan has been an all-out media blitz to portray UAW workers as outrageously overpaid. Its message is the following: “The workers’ incessant demands and high wages broke the Big Three.”
Media pundits and Congress members are quoting from a study published by the right-wing Heritage Foundation that claims UAW workers “earn $75 an hour in wages and benefits—almost triple the earnings of the average private sector worker.” (Heritage Foundation, Nov. 19)
A closer examination, however, reveals the study to be an egregious distortion of the truth.
According to a Dec. 9 article by New York Times journalist David Leonhardt, the figure of $75 per hour is a combination of “three very different categories”—compensation, active employee benefits and retiree benefits.
An active UAW worker earns a total of roughly $55 per hour, including healthcare and pension benefits, about $10 more per hour than non-union workers. At Honda and Toyota plants in the United States, autoworkers make on average about $45 per hour.
But the media claim fails to account for the heavy concessions shoved down the throats of UAW workers in recent years, including a two-tiered wage system and deep cuts in benefits.
In 2007, for example, the UAW agreed to take over autoworkers’ healthcare costs from General Motors when it accepted the Voluntary Employee Beneficiary Association. GM’s financial obligation was thus reduced from $58 billion to only $30 billion, even as U.S. medical costs are expected to rise by double-digit figures. The UAW now is forced to cut back on workers’ health care coverage.
Of course, another fundamental question is raised: Why is health care not provided as a guaranteed right to all the people in the United States—instead of the high cost of health care being tagged to a workers’ income as a “privilege”?
Overproduction to blame, not workers’ wages
The campaign of slander and disinformation launched by the media and the politicians has been quite effective. The very fact that the UAW feels compelled to defend the wages earned by unionized autoworkers exposes its weak, defensive position.
Despite the government’s criticism of the UAW, labor costs still only account for about 10 percent of the cost of producing a vehicle. The truth is that the Big Three’s inability to compete in the global market is not related to high labor costs for U.S. auto companies versus foreign auto corporations like Toyota and Honda.
Toyota, the biggest foreign-owned auto firm in the United States, also suffered huge losses in late 2008. Sales of the Camry, its most popular model, fell 57 percent in November from a year before. From Germany to Spain to Belgium to Poland, car sales are plunging and factories are scaling back production. Capitalist overproduction worldwide is driving the crisis hitting the Big Three, not the UAW or any worker, unionized or not.
Overproduction does not mean that more goods are produced than needed, but rather that more goods are produced than can be sold at a profit. It is the result of a system in which individual capitalists compete to acquire an ever-expanding share of a finite market, creating an inevitable economic bust when markets become saturated with products.
Production is cut, workers are laid off and consumption is decreased, leading to further production stoppages and even more layoffs until “excess” production and inventories have been eliminated and an economic upswing can get underway.
What is really behind attacks on unions
The real aim behind the corporate media’s campaign against the UAW is to further erode the already declining living standards of autoworkers and the working class in general in order to increase the profit margins of the bosses.
A revealing statement by GM’s vice chairman, Robert A. Lutz, makes the motivations behind the anti-worker campaign abundantly clear: “You get these people who say, ‘I know what I’d do if I were CEO of GM, like close up all the union plants and set up plants down South with non-union labor. Well, any idiot can figure that one out. But how conceivably can you get that done?” (New York Times, Dec. 8)
The current media campaign against the living standards of UAW members is clearly an attempt to “get that done.”
Workers at Chicago’s Republic Doors and Windows, faced with unexpected layoffs and being denied their benefits and severance pay, took over their plant in early December. They refused to budge until they received what they were owed—and they won. Though that limited struggle did not save their jobs, it did show that workers can take the offensive and win. The same tactic was used by autoworkers in the 1930s, and helped fuel the upsurge in the labor movement that characterized that period.
Workers should not succumb to ruling-class attempts to pit worker against worker. Workers must take the offensive if labor is to withstand the ruling-class onslaught, which is certain to expand as the economy worsens. Broad-based working-class unity and militancy are the key to successfully defeating attempts by the bosses at rolling back the hard-won gains of the labor movement.
While UAW workers have been attacked for their excessive wages, corporate executives take home millions in pay and bonuses, living in opulence even during the deep economic crisis we are now facing. If anyone should be sacrificing “privilege” as a condition for the bailout money, it should be the fat cats atop the Big Three—not the workers who already struggle to provide for their families. According to a study by the Institute for Policy Studies and United for a Fair Economy, the chief executives of companies in the Standard & Poor’s 500 stock index received pay packages valued at an average of $10.5 million – 344 times the pay of the typical American worker. (Washington Post, Dec. 21) Ford CEO Allan Mulally’s total compensation package last year came to $21.7 million while General Motor’s CEO Rick Wagoner brought in $14.4 million. Chrysler is a private company and does not disclose executive pay. (CNN Money Dec.4) CEOs at major banking institutions rake in even more in compensation. Merrill Lynch paid its former chief executive, E. Stanley O’Neal, a total of $46 million in 2006. The company’s former co-president of Global Markets and Investment Banking Group, Dow Kim, took in $35 million the same year. (New York Times, Dec. 18) In 2007, Goldman Sachs CEO Lloyd C. Blankfein’s salary and bonus package totaled $68.5 million while the companies’ two co-presidents grossed roughly $67.5 million a-piece. (New York Times, Nov. 16) |
