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NEWS & LETTERS, December 2007 - January 2008UAW to serve Wall Street not workersDetroit--The nature of the United Auto Workers union is forever changed. Many analysts have noted that the UAW contracts signed with General Motors, Chrysler and Ford resulted in significant changes, but few, if any, have dealt with the massive impact that those changes will have on every aspect of the lives of everyone, not only on those directly involved in the auto industry, but also everyone in the nation as well as in the world. Of the many provisions in the contracts, the most transformative is the one dealing with VEBA (Voluntary Employees Benefit Association), which transfers employee pensions and health care costs from the corporations to the UAW--a transfer involving billions of dollars (nobody knows how many billions) eventually. 'HELLO, SUCKER' Wall Street financiers are salivating at the prospect of getting their hands on these billions and are developing strategies on how to get these billions to invest. With these new billions, the UAW becomes one of the biggest players in the financial market. What this means is that the UAW's focus will increasingly be on Wall Street instead of the shop floor and the welfare of the rank-and-file workers. Negotiations over the VEBA provisions, involving armies of accountants, economists, lawyers and health care and pension specialists from both the UAW and GM took nearly a month to hammer out--along with a sham two-day strike to try to convince the rank and file that the union was fighting for them. These basic VEBA provisions provided the basic formula for the Chrysler and Ford contracts. WHAT'S GOOD FOR GM... Most rank-and-file workers know instinctively, and from bitter experience, that when corporate executives speak approvingly about a contract, it is good for the corporations but bad for the workers. Every GM, Chrysler and Ford executive, as well as virtually all of the capitalist newspaper and TV commentators, heaped much praise on UAW President Ron Gettelfinger for being "visionary," "realistic," "far-sighted," "progressive," "cooperative," and "understanding." In other words, it is corporate interests that are being served to cut their costs to enable them to become more competitive with other auto manufacturers throughout the world. Cutting costs means cutting workers' benefits. Reducing or eliminating pensions and health care has been spreading slowly in the U.S. for at least a decade. But these auto contracts will open the floodgates for these reductions and will affect every future contract in every industry, as well as all private employers who now provide these benefits. The impact will be felt nationally and internationally. This is reminiscent of l979, when then-UAW President Doug Fraser agreed with then-Chrysler President Lee Iacocca to cut Chrysler workers' wages to "save" the company from bankruptcy (which never would have happened). By giving away what was not his to give, Fraser opened wide the doors to a wave of contract concessions by labor bureaucrats that has continued with a vengeance to this day. NEW HIRES TO WORK FOR HALF Major provisions in the new auto contracts, in addition to VEBA, include a divisive two-tier wage system wherein new hires in non-core jobs (whatever this turns out to be) will be paid about half of what they now make. This is a direct attack on unions and their principle of equal pay for equal work. New hires will be working at the same jobs as older workers, but will be paid half as much. GM also committed to keeping a number of plants open during the term of the contract. It did not say how many workers would remain. Automation in the factories continues at a breakneck speed that has already eliminated at least half of the auto workers in the past 15 years. More layoffs are sure to come. More company flexibility in directing the work force, also agreed to by the union bureaucrats, simply means work speed-up for those who remain in the factory. Workers know very well the many ways the company is always demanding more productivity at their expense. The relatively low margin of approval on the vote at GM frightened the union bureaucrats, who began a concerted effort to sell the contract. They became desperate over the slim approval vote at Chrysler--that approval was in doubt until the very end. Once again the union threw all of its resources to aid the companies and win contract approval at Ford. But the resistance to the contracts has never been so huge in the history of the UAW, reflecting the increasing distrust of the rank and file in their union bureaucrats. --Andy Phillips |
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