Sep 30, 1980
Over the last year, the economic crisis has continued to worsen for the working class. The big monopolies have followed a policy to shield themselves from its problems. First they have raised their prices. Second they have closed down either permanently or temporarily the least profitable sectors of industry and tried to shift their capital to more lucrative sectors. And they have used the decrease in the work force simultaneously with a speed-up to raise productivity. Third, they have held down wages and benefits in recent contracts; and now they are seeking contract re-openers and in some cases demanding actual wage cuts or reductions on COLA payments. This policy has meant to protect their profits by trying to force the working class to pay the price.
For the working class this has spelled increasing hardship. For instance, by March 1980, the purchasing power for the average worker with 3 dependents had fallen 7.9 per cent compared to 1979. As of April 1980, spending power for blue collar workers was lower than it has been since 1962. New contracts negotiated in 1979 provided for the average first year wage gains of only 7.4 per cent, the lowest since 1973. Wage changes in 1979 contracts have averaged less than the increase in prices. There was a 9.1 per cent average wage increase for 9.3 million production and non-supervisory workers compared to the official government figure of 13.4 per cent rise in prices. This past year marked the second year in a row that wages have fallen below prices.
The spectacular increase in interest rates over the last year has meant that the price of many basic purchases has now become prohibitive for the workers. For example, the average car loan rate has gone up 7 per cent over what it was in 1977. The average monthly mortgage payment on a $50,000 house went up from $475 in 1977 to $700 in 1979. All of these figures mark a deep cut in the standard of living of the working class.
Coupled with the problems caused by inflation has been the growing level of unemployment. As of May of 1980, the percentage of workers applying for unemployment compensation is about equal to that during the worst point of the 1974-75 recession. And there is every indication that this will get worse in coming months. The level of unemployment in auto, steel, and construction is a lot higher than the average. At the end of this period of crisis many auto and steel workers will end up permanently out of these industries.
The response of the unions to the crises has been to aim most of their efforts at demanding help from the government. They want the government to intervene more, they say, to protect the interests of the workers. They call on the government to pass new legislation, and to give financial aid to moderate the effects of the crises. The major focus of the unions’ efforts over the last year has been on the issue of how to save jobs.
This effort has taken a very chauvinist form. The unions have campaigned actively against the so-called invasion of the American market by foreign competition. They have demanded that the government act to limit imports and they call for a “Buy American” campaign. As early as the mid-1970s, the USWA has made movies like “Where’s Joe.” In more recent years, the UAW has printed T-shirts and bumper stickers, and unions like the Amalgamated Clothing Workers have paid for TV ads. More recently they asked local unions and retirees to organize picketing of foreign car dealerships, and even tried to get auto workers’ credit unions to refuse car loans to members seeking to buy a foreign car.
The “Buy American” campaign, the lobbying for trade legislation limitations, are no solutions to the problems of unemployment, because it is not foreign imports that are causing the problem. If we look at the problems of auto, for example, this becomes obvious. As of April, the American car companies’ sales figures show that they sold 141,000 fewer new cars than in April of 1979. But imported car sales were down also raising the overall drop in sales to 158,000 fewer cars sold this year than the year before. If we look at the problem also from the viewpoint of layoffs, we see that the argument of the unions is a false one. As of April, Japanese imports’ share of the auto market was up by 3 per cent over the last year, a gain of 17 to 20 percent of the market. Given the level of unemployment in April, this would have accounted for the loss of 30,000 jobs. But in reality there were 225,000 American auto workers unemployed at the time. At least, for the other 195,000 unemployed auto workers, the responsibility can hardly lie with foreign imports.
Not only is the argument about saving jobs false, but what the unions propose, even if they were successful, would mean a lowering of the standards of living of the whole working class, because prices would go up. If the unions propose a ban on imports, it is because imports are cheaper and therefore more attractive to the consumer to buy. But who is this mysterious consumer? In many cases, it is the workers themselves. Thus banning import would mean making the working class pay even more for the American-made products which would be the only products available. Particularly since the ban on imports would remove competition and the price of all American products could go up.
Beyond this, as the bourgeoisie itself no doubt understands, and thus has hesitated to really push for such a policy, protectionism on the part of the U.S. would cause other countries to reciprocate. A barrier against foreign imports would cause comparable barriers to be set up against American products. Such a policy in the long run would lead to a slow-down and the breakdown in trade on a world scale, which can only lead to a worsening of the economic crises. Thus under the pretext of protecting workers against the crisis, the policy advocated by the unions would in fact make the crisis worse. Perhaps in the future the bourgeoisie could decide to take such a desperate step, but in no sense could it be held up as an advance for the workers.
The unions, which began their argument by telling the workers that it is in their interests to protect the American economy against foreign imports by the trade restriction, soon logically progress to argue that it is in the interests of the workers to also ease restrictions against the bosses at home. All of this is proposed in the name of making domestic-made products more competitive. The unions have tended to go along more in the recent years with attempts by the big concerns to relax health, safety and pollution standards. The USWA has opposed anti-pollution requirements in steel production. The UAW has opposed emission control and mandatory safety installations. There has also been an open acquiescence on the part of the unions in relaxing work standards on the job, in the form of increased speed-up and reduction in safety precautions, provisions of safety equipment, proper maintenance of machinery and general factory maintenance. Again, all of this has been agreed to on the grounds of cutting the costs of production as a necessity to keep jobs. In fact, all of these things have been done in the past and they have not prevented the unemployment. And in fact, with the speed-up, more jobs are lost. And worse, these measures have endangered the health and maimed and killed millions of workers and their families on and off the job.
But the road of sacrifices by no means stops here. The unions tell each group of workers not to be greedy and to expect wage gains and benefit increases that could make it impossible for their boss to compete. Of course, they can’t say to the workers that the workers alone must sacrifice, so the unions hide what they are really asking under the guise of the so called “equality of sacrifice” by workers, consumers and the bosses. Or they use the argument that giving up wages and benefits, while it hurts, will save jobs. The rationale is that it is better to have a job paying less rather than to be unemployed.
They also use the same argument which they used on the general level and apply it to a particular industry or company. They say that the steel industry is hit hard by the crisis so steel workers must be prepared to give up more than other workers. Or they say that Chrysler is the weakest of the auto companies so Chrysler workers must be prepared to take less in a contract than GM workers. A side effect of this policy is to encourage the workers to believe that they might benefit from the misfortune of other workers. So, in a period when the working class needs to be stronger by being united, the union bureaucrats instead divide it. For example, GM workers could believe that if Chrysler goes under, their jobs might be more secure because GM will be better off without competition. This is simply a continuation of the corporatist reasoning that has always colored the unions’ policies.
To propose to the workers the kind of sacrifices that the unions are proposing solves nothing for the workers. It doesn’t save jobs – the hundreds of thousands of steel workers who have lost their jobs in the last decade can testify to that, as can the tens of thousands of Detroit Chrysler workers who have seen their plants close down in the last year. It is simply a way to allow the bosses to take back the gains that the workers won previously in a better economic period when the bosses thought they could afford more crumbs.
Behind the talk of “equality of sacrifice” is the proposal in fact that the workers pay the whole cost of the crisis by themselves. Not only do the bureaucrats propose that the workers accept such sacrifices but they try to convince the workers that such sacrifices will save their jobs, will slow inflation, and pull the economy out of its slump.
And what has been the results for the workers of these union policies? It has meant that the Chrysler workers were forced to give up 480 million dollars in wages and benefits. It meant that the steel workers got a 3 per cent wage increase with inflation running at 18 per cent. It meant that the rubber workers took a pay cut that will mean an average loss for them of $5,148 in 1½ years. It means that in the coming month the Teamster reopener could mean more cutbacks for them. And it meant that the Communication Workers, in spite of record 1.4 billion dollar profits in the last quarter for the phone company, still proposed a contract for its workers that failed to keep up with inflation, in the name of the economic crisis.
This is the situation for the workers in major industry and for the workers of the biggest companies with the strongest unions. The situation for workers in small shops and for government and service workers is even worse.
They talk about “equality of sacrifice.” In the meantime, the increase in the after-tax profits of the big corporations from 1978 to 1979 was almost 19 per cent. This is the true meaning of the bosses’ equality.
And the response of the unions to this reality is simply to accept it, and even to warn the workers that they should be prepared to give up in the future.
Another aspect of the policy of the unions has been to call on the government to aid the corporations in trouble, in the form of tax breaks and more recently direct aid as in the case of the billion and some dollars given to bail out Chrysler. They have done this on the grounds that government aid is needed to keep the plants open and thus save jobs.
But if there is no market for a product, then government aid doesn’t change very much. The government can help a monopoly such as Chrysler to stay alive for awhile and not go under. But it can’t force people to buy their cars, or force investors to put money into the company. If auto sales are down, government aid to Chrysler won’t solve the problem. It can simply mean a stay of execution, not a recovery.
The success of Chrysler in receiving government aid is less due to the forceful and effective campaign by the unions, anyway, than to a big monopoly’s ability to get its friends in the government to help it out. In fact, it was not the UAW that used the government but the other way around. Fraser and the UAW’s campaign on behalf of Chrysler provided a good cover for the bosses and the government to justify giving the workers’ money to the bosses. How clever to be able to give a nice juicy welfare check to the bosses while the workers accept wages and benefit cuts, and pretend all the while that you are doing it because the workers’ own representatives have demanded this.
Further it allowed Fraser to trick the workers into believing that the government could be counted on to help out, without UAW members themselves being mobilized to do anything for themselves. In fact, such a maneuver served to convince workers that is was better not to do anything because if they made a fight it might hurt Chrysler’s chances with the government. So the workers were persuaded to count on Fraser which suited the government, the Chrysler bosses, and Fraser himself, no doubt, just fine.
The money that Chrysler received has by no means saved jobs. Since the money came through, Chrysler has closed down one plant after another in Detroit, and drastically reduced its work force. So all the Chrysler bail-out did was give money to the bosses to use as they please.
If the unions wanted to demand one and a half billion dollars from the government to really help the Chrysler workers, they could have demanded that the government pay this money directly to the workers themselves. Of course such a course of action would not have changed anything in the crisis. But it would provide them with temporary help and be better than giving the money to the bosses, which for the workers has been no help at all.
The unions have called for some government aid directly to the workers in the form of extended unemployment benefits and TRA money, but only a very small proportion of the workers affected by the crisis qualify for this aid. It is limited to one year. It is hardly a drop in the bucket compared to the unemployment.
The policy of the unions today has nothing in common with fighting for the workers’ interests. The solutions the unions put forward are not real or efficient ones even within the framework the union officials themselves propose. The proposals of the unions are simply an acceptance of the reality that the bosses have decided to impose on the workers anyway. Henry Ford I once described an economic depression as a “wholesome thing in general.” He made this comment in the 1930s. No doubt the same sentiments are echoed today by the big monopolies as they watch some of their competition go under and as they watch the union officials do their dirty work for them.
The policy of the bureaucrats consists of getting the workers to passively lay their heads on the block so it is easier for the bosses to chop them off.
The policies of the unions in the period of crises are by no means a change from their usual policies. It is a policy of class collaboration: to bind the workers to accept bourgeois legality; to accept the contracts, arbitrations, injunctions, and other restrictions as a normal state of affairs. It is a policy that tries to keep the workers within a legal framework created by the ruling class to maintain the exploitation and oppression of the working class. It is the policy of the “social contract.”
Today, it is a bargain struck with the aid of the government to make the working class accept the need for all to sacrifice to make the U.S. economy get well. This harmonious relationship between labor and management was extolled recently in an interview in the Detroit News with George B. Morris, a retiring GM vice-president for industrial relations. Morris says:
“There will always be critics who think that management and labor must be in constant battle. We don’t agree and we think the record will show that all concerned have benefitted from the GM-UAW collective bargaining system. I sincerely believe the UAW and GM have more in common than in conflict.”
No doubt there are many rank and file auto workers who would find this statement to be only too painfully true though they do not find it to their liking.
Such a harmonious relationship even in the best of economic times always accepts that the capitalists have the right to share with the workers the benefits of what the workers produce, and moreover that it is the capitalists who decide what their share should be. Obviously, they take the bigger share.
The logic of this policy when carried over into bad times has had a much more serious impact on the workers. The unions’ policy today consists not in opposing the workers’ interests to those of the bourgeoisie, but in imposing the bosses’ solutions on the working class. The discussion by the unions today is not how to force the bosses to pay for the crisis but instead how to get the workers to pay for them. The logic of the unions’ policy today means disarming the workers just at the time when the bosses are on the attack. It means, even worse, to give the bosses more weapons and to collaborate in planning strategy to make war on the working class.
Of course the policy of the unions today is by no means the only possible policy for the working class. In response to the unemployment, the workers could put forth the demand for the sliding scale of wages and hours. In response to the inflation the working class could demand an equal increase in wages for every increase in the cost of living. The working class has the possibility of mobilizing itself around its own program – one that offers a series of proposals that correspond to the workers’ real interests. This would mean that the workers were refusing to sacrifice their standard of living and instead were trying to force the bosses to pay the cost of the crisis. It is in this way that the working class could defend itself against the effects of the crisis.
Such a policy could not be imposed on the bourgeoisie without a fight, without a real mobilization of the working class acting in its own interests. But there is no other way for the working class to avoid paying the cost of the crisis. Such a policy and mobilization of the workers is not in the sights of the unions today. Their policy is not a defense of the working class. Certainly, we cannot reproach the union officials today for not organizing a struggle when the workers themselves are not ready to struggle. But it is possible for these officials at least to hold out to the workers the necessity for their own mobilization and struggle. And this they don’t do.
Instead, at every turn the union officials tie the hands of the workers, demoralize them, undercut the workers’ confidence in themselves and their ability to act. They counterpose themselves to the workers’ own activity and tell the workers that the solution to the workers’ problems depends on the union officials, on the government and on negotiations with the bosses.
These union officials are not the representatives of the workers at all. They are, as De Leon put it, the “labor lieutenants of capital.” For them, there is a reward: for example, Fraser’s seat on the Chrysler Board of Directors. They try to make the workers believe that the workers’ interests and the bosses’ interests are one and the same, because they see their own interests as the same as the capitalists.
Despite the acceptance by the workers of the sacrifices imposed on them today by these bureaucrats, we could see the working class begin to mobilize itself. And if it does, we could also see these same bureaucrats, despite their stance today, try to strike a more militant pose, the better to put themselves at the head of such a mobilization. But we can be sure, if they do it, it will be in order to divert the movement, to try to tie the workers one more time within the framework of the legalities, contracts and negotiations. For the workers, the best chance of continuing their mobilization and fighting for their own demands will be if they can free themselves from the influence of these bureaucrats.