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| United Auto Workers Local 551 members rally at Chicago union hall Oct. 7. Watched by millions, UAW strikers fought to win back concessions given to Big Three bosses in 2007. (Figure & Caption Source; MILITANT/SALM KOLIS) |
James Dennis Hoff, CUNY English professor and prominent contributor to Left Voice, writes an extended think piece entitled The UAW Won Big: What Does It Mean for the U.S. Labor Movement?. (It's dated Nov. 12th, before the proposed contract was ratified.) He nicely summarizes the outcome (links in original).
Though UAW members are still debating and voting on the tentative agreements, and though they did not win everything they aimed to (in fact, as the recent no vote at the Flint Michigan plant shows, they probably could have won more if the rank and file had been in the lead), this is nonetheless a victory for the auto workers. The gains in these proposed contracts are substantial, and represent a significant restoration of the concessions on wages and benefits made to the Big Three over the last 15 years. Not only did the union manage to secure wage increases of 25 percent across the life of the contract, with 11 percent in the first year and a $5,000 signing bonus; they also took significant steps toward the elimination of wage tiers at all three automakers and managed to win back cost of living adjustments that will protect those wages against inflation going forward.
Professor Hoff is correct--the outcome is a victory for the union. The 25% pay raise is over the 4½ year life of the contract. Adding in the cost-of-living adjustments, this is probably close to the 40% that the union was originally asking for. In addition, "...the union was able to use the strike to force all three auto companies to make big investments in new manufacturing and to secure pathways toward unionizing electric vehicle (EV) and battery plants that will help protect jobs and wages as the industry transitions to EV production."
So what could go wrong? First, the contract assumes continuing inflation, absent which the companies will not be able to raise prices sufficiently to pay the new labor costs. But that doesn't seem to be panning out. While services (eg, airline fares, restaurant meals) costs are continuing to climb, goods costs are now shrinking, specifically "... appliances, furniture, used cars and other goods" are getting cheaper. Walmart reports deflation on many items in its stores:
Deflation in some items is creating a new dynamic for Walmart, [CEO Doug] McMillon said. In general merchandise, the category that includes electronics, toys and other nonfood items, prices have dropped by about 5% compared with a year ago, he said.
What happens if new car prices start going down? Are the workers gonna take a pay cut, ie, the opposite of COLA? Of course not--it will all come out of the margin. The companies will be forced to cut costs, lay off employees, and at least temporarily close factories.
Second, there is the problem of electric vehicles (EVs). While the sales of EVs are still increasing, the rate of increase is far below what was anticipated. Accordingly, "General Motors will be slowing its electric car (EV) production in North America due to lower-than-forecast demand, pushing its manufacturing targets well into 2025. The decision saves the company $1.5 billion next year..."
I think the problem with EVs is that they simply don't work. The technology is not ready for prime time. And as Trump has pointed out, most EV production will take place in China. The big cost for EVs is not in the assembly, but rather in mining the myriad raw materials (lithium, copper, nickel, rare-earth metals, etc.) China has a huge head start on that and can do that much cheaper than we can. The promises made to the union about future EV production will not happen.
The reason for the union's victory was not primarily because of militancy, but more because of an endemic labor shortage, especially for the skilled trades. Professor Hoff doesn't realize that--he somehow thinks the unionists will get paid above the market rate. I doubt that's true, and if that is true then union members will gradually be laid off and assembly plants will move to non-union states or to Mexico.
Professor Hoff has, for a Marxist, a very strange suggestion for the union. The union would be much better served if they (emphasis mine)
...insist that strikes like these be led from below by strike committees in each workplace, where decisions about where and when and how to strike are openly debated and discussed and that the negotiations be public and open to all members throughout the bargaining process.
Leaders, in his view, should do no more than organize meetings and make sure everything is transparent and open. Negotiating in good faith (which means keeping some things confidential) should not be allowed. In a word, the union should be governed by the mob--not by any elected, competent and accountable leadership.
Anarchists champion from below organizations, and they're spectacularly unsuccessful. Leninists reject that approach, advocating instead guidance from a vanguard Party with the expertise and experience necessary to lead the working class to victory. Professor Hoff weirdly sides with the anarchists here, rejecting his self-proclaimed Leninism.
The Militant posts a recent article (by Terry Evans) entitled UAW members debate, vote up contract, more fights to come. The piece makes many of the same points as Professor Hoff, albeit with a different emphasis. Mr. Evans' summary post-mortem includes this,
The fight was watched closely by millions of workers who also face falling real wages and worsening conditions from past concessions to the bosses and today’s deepening capitalist crisis.
There is no question workers won some important gains. And most came away feeling the union was stronger, better prepared to fight.
The Militant's main quibble with the outcome of the strike concerned pensions (an issue mentioned only in passing by Professor Hoff). After noting that workers hired before 2007 will still receive defined benefit pensions (albeit with only a 9.8% raise in monthly benefits), others face a supposedly bleaker future.
The situation facing workers who got jobs after 2007 is far worse. “We don’t have pensions or health care when we retire,” Randolph said. These workers get an inferior 401(k) plan, as do all new hires. “Pensions and post-retirement health care were a huge topic,” newly elected President Katie Deatherage of Local 2250 at GM’s plant in Wentzville, Missouri, told the press. She said 70% to 75% of workers there were hired after 2007. Workers voted the contract down.
It's not at all certain that the 401(k) plan is inferior--it depends on how carefully and successfully it is invested. The problem with defined benefit packages is they have an unfortunate tendency to go bankrupt--that's because both union officials and company execs are happy to promise hopelessly unrealistic benefits, knowing that the bills won't come due for decades, long after they've left office. The 401(k) may seem chintzy by comparison, but they are far less risky, and workers are much less likely to lose everything.
One last point: all my Trotskyist friends are mad at the billionaires and millionaires, with Professor Hoff commenting favorably on UAW chief Shawn Fain's sentiment:
Through a regular and concerted denouncement of the super rich, including the CEOs and executives of the Big Three, Fain and the UAW were able to call attention to the ways in which the assaults on the living standards and well being of auto workers were part of a larger assault on working people everywhere ...
Of course it's all wrong--the so-called billionaires take nothing away from either Mr. Fain or Professor Hoff. Without billionaires there would be no millionaires, and without millionaires there wouldn't be anybody who could afford a $60,000 F-150 pickup truck. Without billionaires the UAW would be out of business altogether.
My Trotskyist friends don't even like Mary Barra, CEO of GM. According to this site she earned $34.1 million in 2022. That sounds like a lot of money! OK--it is a lot of money! But divvy it up among GM's 167,000 employees it comes to $201 per employee. So that's a nice Christmas bonus, but frankly, in the grand scheme of things, it's small change.
The UAW strike was successful mainly because of the on-going labor shortage, especially of skilled workers. It's possible the union has priced themselves too high (if inflation doesn't materialize), in which case UAW membership will shrink below it's already record low enrollment.
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